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Free Trade, Globalized Production and Post-Fordism.docx

3 Pages

Political Science
Course Code
Political Science 2211E
Adam Harmes

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Feb 13, 2012- Free trade, Globalized Production and Post-Fordism Today’s Topics 1. Postwar Protectionism 2. The Shift to Free Trade 3. The Globalization of Production and the Shift to Post-Fordism Protectionism  Opposite of free trade  Government intervention to protect domestic industries  Tariffs: tax on imports  Non-Tariff Barriers:  Quotas  Subsidies  “Buy Canadian” Post-WW2 Era  Absence of free trade  1947 General Agreement on Tariffs and Trade (GATT)  Slowly lowering tariffs through successive negotiating rounds  Many countries had tariffs and attracted branch plants  Led to the growth of Multi-National Corporations (MNC’s)  Set up factories to get around tariffs and sell into local market Post-WW2 Era in Canada  Trade still guided by National Policy of 1878: high tariffs and open investment policy  Protect infant industries  Attract branch plants The Shift to Free Trade  Firms moved to developing countries in response to stagflation and high wages, taxes and regulations  Debt crisis, IMF and creation of export processing zones  Increased demands for free trade Global Free Trade  Uruguay Round of GATT  1986-1994  Finalized the shift from protectionism to free trade Uruguay Round  Expanded tariff reductions for textiles and agriculture for developing countries  General Agreement on Trade in Services (GATS) ****KNOW DIFFERENCE BETWEEN GATS AND GATT FOR EXAM*****  Reduced tariffs in the service sector  Mainly desired by developed countries  Knowledge-based industries?  Software  Pharmaceuticals  Cultural products  GMOs (Genetically Modified Organism)  Making tomatoes last longer, use part of pig and splice it together with tomato  High Research and Development costs  Cheap and easy to copy  Intellectual property rights  Copyrights, patents, and trademarks  Copyright was mainly national (restricted to US for say)  Uruguay round tried to bring in intellectual properties at the International level TRIPS  Trade Related Intellectual Property Rights  International recognition of property rights and patents  Notion for an idea to have mutual recognition worldwide  Investor property rights  Designed to prevent nationalization of private assets  Allowed firms to sue government Uruguay Round  Created WTO  Single undertaking, either in or out  Created permanent institutional structure  Oversee negotiations  Monitor compliance  Dispute resolution court Branch Plants  Protectionism  Branch plants to get inside tariff wall to sell to local markets  Usually plants outside a country have to pay high tariff taxes, but if Canada for example says to a US plant that if they build a plant on Canadian soil they do not have to pay these tariffs. In turn, gives more employment to Canadian economy while also receiving a corporate tax from the branch plants Plant under Free-Trade  Free trade  Tariffs removed  Countries make products and sell them to each other Glo
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