What are the arguments against International trade?

 

This article covers the following:

1. Introduction

2. Arguments against International Trade

3. Conclusion

4. Difference between international trade and inter-regional trade.

1. Introduction of the arguments against international trade:

It is true that international trade has some merits but it is also the important to look some of the problems created by it. The major arguments against international trade from the point of view of less developed countries like India are as follows- 

2. Arguments against International Trade:

10 main arguments in favor of restricting International trade:

(i) Exploitation of resources and markets: The advanced countries have continued to exploit the natural resources of the poor countries for their expansion of industries. 

(ii) Balance of payment deficits: Poor countries are export less but import more essential goods and services, it has involved them into burden of balance of payment deficit. 

(iii) International debt problem: The international trade has created an acute problem of repayment of international trade. 

(iv) Adverse terms of trade: Less developed countries are produce and export of primary products, but price of these product is less than manufactured goods produced by developed countries. 

(v) Lack of industrial diversification: The international trade tends to cause specialisation of production which militates against diversification of industries and create a balanced in the process of growth. 

(vi) No exchange stability: The different countries continue to adopt international trade foreign and other policies which have created obstacles in the international stability of exchange rates. 

(vii) Political interference: The advanced countries has employed trade and economic assistance as the pretexts for their political interference in the poor countries. 

(viii) International transaction of fluctuation: The increased economic inter-dependence of the countries through international trade transaction cycle fluctuations from one county to another. 

(ix) Shortage of development finance: It is believed that the international trade can encourage the flow of development finance from the advanced countries to the poor. This type of expectation has not be realized. 

(x) Cause of war: The advanced countries have fought two world wars just for sources of raw materials and dumping places for their manufactured goods. 

3. Conclusion of the arguments against international trade:

International trade may be an engine of growth but it exploit the poor countries of the third world in many ways.

4. What are the difference between international trade and inter-regional trade?

The difference between international trade and inter-regional trade are point out below-

(i) The factors of production are freely mobile with in each region as between places and occupations and immobile between countries into international trade. 

(ii) There is a relatively more free mobility of products with in the different regions of a country but there are several man-made barriers in case of international trade. 

(iii) The international markets lack homogeneity on account of different in language, tastes, fashions, customs and system of weights and measure but such differences may not exist in the case of markets with in the same country. 

(iv) In case of inter-regional trade there use only one type of currency but in case of international trade there are use different types of currencies. 

(v) The costs of transporting goods to the are generally higher than those in the inter-regional trade because of vast geographical distance between the different countries. 

(vi) All the residents of a country share a common political system but in case of international trade there are different types of political system. 

(vii) In case of inter-regional trade, there is a single uniform national policy, but in case of international trade there are use different types of national policies. 

(viii) It is not possible for a given country to produce domestically every type of product. The geographically and climate conditions which differ from country to country influence their specialisation in production and export. 

(ix) The problem of balance of payment is occurred in international trade while regions with in a country have no such problem. 

(x) Inter-regional trade is occurred with in the country but international trade occurred between countries.