The aim of this paper is to analyze and discuss the advantages and disadvantages of unrestricted international trade, thus arriving to a comprehensive conclusion concerning the nature of this phenomenon. Globalization itself being a controversial phenomenon, the advocates of the idea of free trade believe that the development of business is intrinsically linked to enhancement of social well-being (Moon, 2000). It makes goods available to the majority of world population, and specialization of labor improve the efficiency of businesses and create grounds for innovation and better human resources management.
In addition, some countries have few natural resources, and trade helps them earn the foreign exchange needed to purchase raw materials for its economy, Japan being the prime example. However, the opponents of unrestricted international trade argue that important national industries aren’t competitive on the global level. For instance, cultural industries are essential for the maintenance of national identity, yet they are often unable to compete with the omnipresence of American mass culture.
Thus, governments need to offer protection to such industries. Yet such arguments lack credibility for the reason that consumers have the right to have preferences concerning products to purchase. Consumer’s rights include the ability to choose products of the highest usability, irrespective of the country of origin. Another argument employed in the debate on international trade is that unrestricted trade harms developing countries.
One of the perceived flaws of the current system is that developed countries pressure the third world into striking unfair trade deals. Yet there are international institutions that are fairly successful in overseeing free trade. For example, WTO adopts rules on market access, technical barriers to trade, sanitary and phytosanitary measures, customs and trade administration, anti-dumping, subsidies and countervailing measures, safeguards, and other measures to ensure equal participation of all states in international trade.
In fact, international trade may result in short-term losses for developing countries, yet it makes them better off in the longer run. Free trade inevitably results in greater international exposure, which in turns leads to liberalization and democratization of developing countries. Thus, giving a tough-but-fair evaluation of the phenomenon of unrestricted international trade, it is evident that it benefits both developed and developing countries.
Moon, Bruce Edward. (2000). Dilemmas of International Trade, 2nd ed. Boulder, CO. : Westview Press.