Management and Organizational Studies 2285 Lecture Notes - Lecture 5: North American Free Trade Agreement, Environmental Protection, Purchasing Power Parity

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2285
• Professor: Trevor Hunter

Document Summary

Trade policies: free trade no governmental restrictions on what its citizens can buy from or sell to another country, an ideal based on theory and ideology but rarely practiced in reality (despite the wto) Instruments of trade policies: tariffs tax levied on imports. Ad velorum proportion of imported value: subsidies government payment to domestic producers. Bombardier has been subsided for a long time. Dairy farmers have been subsidized for a looong time as well. Go(cid:448)e(cid:396)(cid:374)(cid:373)e(cid:374)ts ge(cid:374)e(cid:396)all(cid:455) su(cid:271)sidize i(cid:374)dust(cid:396)ies that a(cid:396)e (cid:862)(cid:272)(cid:396)o(cid:449)(cid:374) je(cid:449)els(cid:863) i(cid:374) the country. Import quotas direct restriction on how much of a certain good can be imported. Protects domestic producers by limiting the amount of potentially lower cost competing goods. Local content requirements some specific fraction of a good be made domestically. Limits foreign imports by forcing them to use locally made parts or raw materials: administrative trade policies red tape making it difficult to fulfill requirements and therefore difficult to import.