PO102 Lecture Notes - Lecture 14: Friedrich List, Mercantilism, Comparative Advantage
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Benefits/Positive Effects of trade:
The range of consumer choices is widened
Helps diffuse technology
Creates jobs
- Stimulates economic growth
Negative Effects of Trade:
It can destroy national industries
Can displace workers or lead to job flight
Can threaten culture and identity of a country
1995 Trade states Proportion of GDP
US: Just over 20%
France: 47%
UK: 60%
Sweden: 80%
Trade is less important to the US and China due to the size of the economies
Trade is always in the news and is controversial
Difference of opinion:
Is it a source of peace:
- Interdependence creates positive bonds
Or
Trade and interdependence make countries dependent and vulnerable
Adam Smith (Liberal):
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