Book contents
- Frontmatter
- Contents
- List of boxes
- List of tables
- List of symbols, abbreviations and acronyms
- Preface
- 1 Introduction
- Part I The market, efficiency and equity
- Part II Normative and positive theory of economic policy
- Part III Microeconomic policies
- Part IV Macroeconomic policies
- 10 Macroeconomic schemes of analysis in an open economy
- 11 Macroeconomic objectives and monetary policy
- 12 Macroeconomic objectives and fiscal policy
- 13 Incomes and price policies
- 14 Balance-of-payments policies
- 15 Trade policies: free trade and protectionism
- Part V Public institutions in an international setting
- Part VI Globalisation and the quest for a new institutional setting
- Bibliography
- Author index
- Subject index
15 - Trade policies: free trade and protectionism
Published online by Cambridge University Press: 14 May 2010
- Frontmatter
- Contents
- List of boxes
- List of tables
- List of symbols, abbreviations and acronyms
- Preface
- 1 Introduction
- Part I The market, efficiency and equity
- Part II Normative and positive theory of economic policy
- Part III Microeconomic policies
- Part IV Macroeconomic policies
- 10 Macroeconomic schemes of analysis in an open economy
- 11 Macroeconomic objectives and monetary policy
- 12 Macroeconomic objectives and fiscal policy
- 13 Incomes and price policies
- 14 Balance-of-payments policies
- 15 Trade policies: free trade and protectionism
- Part V Public institutions in an international setting
- Part VI Globalisation and the quest for a new institutional setting
- Bibliography
- Author index
- Subject index
Summary
Trade policies and the foundation of free trade
Trade policy can be defined as the attitude of a country's economic policymakers towards foreign trade. Putting it very briefly, they can take a liberal attitude, meaning that they do not raise barriers to exports and, above all, imports, or they can assume a protectionist stance, meaning that they attempt to safeguard domestic firms against foreign competition. A third position is autarky, which seeks to close the domestic economy to the rest of the world.
Liberal policies consist simply in the elimination of all barriers to foreign trade. In this section we give a brief sketch of the fortunes of protectionism and free trade in the modern era and lay out the foundation of free trade; in section 15.2 we discuss protectionist instruments and in section 15.3 we examine their effects. Sections 15.4–15.8 analyse the various justifications of protectionism. Section 15.8 discusses the relationships between trade policy and industrial policies. We do not examine autarkic policies.
As a trade policy alternative to free trade, protectionism has been both the subject of an extensive theoretical debate that marked the very birth of economic science and the focus of a variety of government actions over the ages.
To limit ourselves to the modern era, examples of such policy measures include the Navigation Act of 1651, with which Oliver Cromwell made use of vessels of the English merchant marine mandatory for all the country's imports and exports.
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- Information
- Economic Policy in the Age of Globalisation , pp. 343 - 356Publisher: Cambridge University PressPrint publication year: 2005