下载掌阅APP，畅读海量书库
立即打开
Protectionism refers to government policies that restrict international trade to help domestic industries. Protectionist policies are usually implemented to improve economic activity within a domestic economy but can also be implemented for safety or quality concerns.
An economy usually adopts protectionist policies to encourage domestic investment in a specific industry. For instance, tariffs on the import of shoes would encourage domestic producers to invest more resources in shoe production.
In addition, nascent domestic shoe producers would not be at risk from established foreign shoe producers. Although domestic producers are better off, domestic consumers are worse off as a result of protectionism policies, as they may have to pay higher prices for somewhat inferior goods or services. Protectionist policies, therefore, tend to be very popular with businesses and very unpopular with consumers.
1）Advantages of Protectionism
•More Growth Opportunities
Protectionism provides local industries with growth opportunities until they can compete against more experienced firms in the international market.
•Lower Level of Imports
Protectionist policies help reduce import levels and allow the country to increase its trade balance.
•More Jobs
Higher employment rates result when domestic firms boost their workforce.
•Higher GDP
Protectionism policies tend to boost the economy's GDP due to a rise in domestic production.
2）Disadvantages of Protectionism
•Stagnation of Technological Advancements
As domestic producers don't need to worry about foreign competition, they have no incentive to innovate or spend resources on research and development（R＆D）of new products.
•Limited Choices for Consumers
Consumers have access to fewer goods in the market as a result of limitations on foreign goods.
•Increase in Prices（due to the lack of the competition）
Consumers will need to pay more without seeing any significant improvement in the product.
•Economic Isolation
It often leads to political and cultural isolation, which, in turn, leads to even more economic isolation.
1）Tariffs
Import tariffs are one of the top tools a government uses when seeking to enact protectionist policies.Three main import tariff concepts can be theorized for protective measures. In general, all forms of import tariffs are charged to the importing country and documented at government customs.Import tariffs raise the price of imports for a country.
Scientific tariffs are import tariffs imposed on an item-by-item basis, raising the price of goods for the importer and passing on higher prices to the end buyer. Peril point import tariffs are focused on a specific industry. These tariffs involve the calculation of levels at which import tariff decreases or increases would cause significant harm to an industry overall, potentially leading to the jeopardy of closure due to an inability to compete. Retaliatory tariffs are tariffs enacted primarily as a response to excessive duties being charged by trading partners.
2）Import Quotas
Import quotas are non-tariff barriers that are put in place to limit the number of products that can be imported over a set period of time. The purpose of quotas is to limit the supply of specified products provided by an exporter to an importer. This is typically a less drastic action that has a marginal effect on prices and leads to higher demand for domestic businesses to cover the shortfall.Quotas may also be put in place to prevent dumping, which occurs when foreign producers export products at prices lower than production costs. An embargo, in which the importation of designated products is completely prohibited, is the most severe type of quota.
3）Product Standards
Product safety and high volumes of low-quality products or materials are typically top concerns when enacting product standards. Product standard protectionism can be a barrier that limits imports based on a country's internal controls. Some countries may have lower regulatory standards in the areas of food preparation, intellectual property enforcement, or materials production. This can lead to a product standard requirement or a blockage of certain imports due to regulatory enforcement. Overall, restricting imports through the implementation of product standards can often lead to a higher volume of commodities production domestically.
4）Government Subsidies
Government subsidies can come in various forms. Generally, they may be direct or indirect.Direct subsidies provide business with cash payments. Indirect subsidies come in the form of special savings such as interest-free loans and tax breaks. When exploring subsidies, government officials may choose to provide direct or indirect subsidies in the areas of production, employment, tax, property, and more.
When seeking to boost a country's balance of trade, a country might also choose to offer subsidies to business for exports. Export subsidies provide an incentive for domestic businesses to expand globally by increasing their export internationally.
5）Currency Manipulation
It is a deliberate attempt by a country to lower its currency value. This currency manipulation would make its exports cheaper and more competitive. This method can result in retaliation and start a currency war. One way countries can lower their currency's value is through a fixed exchange rate. Another way is by creating so much national debt that it has the same effect. Some countries criticize the U. S. government for doing that, creating a U. S. dollar decline.