![]() ![]() Regional trade blocs cut into global economic growth by promoting one region over the rest.If native industries can't compete with foreign ones, they go under, leaving lots of people jobless.Small companies may find themselves crushed by lower-priced goods coming in from out of the country. Trade blocs are great for major corporations that have the resources to adapt to an international playing field.Trade blocs may retaliate against each other by raising tariffs or imposing regulatory roadblocks on imports.That reduces the pressure on them to become more efficient and productive. Inefficient companies or industries within the trading bloc have protection against competitors in other nations.Countries outside NAFTA, for instance, are at a disadvantage selling to the U.S. Many of them stem from the way other countries are shut out of the benefits members of the trade bloc enjoy. One study found that trade agreements don't actually reduce costs, but the quality of the goods for sale goes up.Īlong with the advantages of trade blocs, economists say they have multiple harmful effects. The growth in trade and sales can lead to a growth in jobs.Įconomists debate whether these results actually come true in practice, rather than just in theory. ![]()
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