The theory of comparative advantage shows how countries can benefit from specialization and international division of labor. Notwithstanding this established economic finding, legislatures are continuously besieged by groups lobbying for protective measures in the form of tariffs or import quotas. In the United States, congress and the President struggle every year over whether to enact measures to protect domestic industries from inexpensive imports.
Is protectionism sound economic policy? Economists generally agree that it is not. They believe that free trade promotes a mutually beneficial division of labor among nations and that free and open trade allows each nation to expand its production and consumption possibilities, raising the world's living standard.
But many people disagree with its assessment. Just s Alexander Hamilton wanted to build tariff walls around our manufacturing industries in 1789, so today people argue that we need to protect our industries against foreign competition. This theory reviews the economic impact of protectionism. I think this explanation will satisfy your question that what is the role of protectionism in comparative advantage theory, which can be beneficial for country.
Is protectionism sound economic policy? Economists generally agree that it is not. They believe that free trade promotes a mutually beneficial division of labor among nations and that free and open trade allows each nation to expand its production and consumption possibilities, raising the world's living standard.
But many people disagree with its assessment. Just s Alexander Hamilton wanted to build tariff walls around our manufacturing industries in 1789, so today people argue that we need to protect our industries against foreign competition. This theory reviews the economic impact of protectionism. I think this explanation will satisfy your question that what is the role of protectionism in comparative advantage theory, which can be beneficial for country.
