Podcast
Questions and Answers
What is a common tool used in industrial policies?
What is a common tool used in industrial policies?
Import restrictions are not part of industrial policies.
Import restrictions are not part of industrial policies.
False
Name one challenge faced by governments in implementing industrial policies.
Name one challenge faced by governments in implementing industrial policies.
Balancing protectionism with free trade principles
The ________ is responsible for resolving trade disputes between member countries.
The ________ is responsible for resolving trade disputes between member countries.
Signup and view all the answers
Match the following terms with their definitions:
Match the following terms with their definitions:
Signup and view all the answers
What was one of the major consequences of the Smoot-Hawley Act in 1930?
What was one of the major consequences of the Smoot-Hawley Act in 1930?
Signup and view all the answers
The Most-Favored-Nation (MFN) clause allows for unequal tariff treatment among trading partners.
The Most-Favored-Nation (MFN) clause allows for unequal tariff treatment among trading partners.
Signup and view all the answers
What year was the World Trade Organization (WTO) established?
What year was the World Trade Organization (WTO) established?
Signup and view all the answers
The U.S. shifted from protectionism to __________ after World War II.
The U.S. shifted from protectionism to __________ after World War II.
Signup and view all the answers
Which of the following is a key function of the WTO?
Which of the following is a key function of the WTO?
Signup and view all the answers
Match the trade terms with their correct definitions:
Match the trade terms with their correct definitions:
Signup and view all the answers
Which measure can be taken if a foreign government subsidizes its exports?
Which measure can be taken if a foreign government subsidizes its exports?
Signup and view all the answers
Transparency in trade policies is essential for avoiding arbitrary changes in tariffs.
Transparency in trade policies is essential for avoiding arbitrary changes in tariffs.
Signup and view all the answers
Study Notes
Trade Regulations and Industrial Policies
- Trade Regulations: Laws & policies governing international trade (tariffs, quotas, restrictions).
- Industrial Policies: Government strategies promoting specific industries (growth & protection from foreign competition).
Historical Context of US Trade Policy
- Pre-1930s: High tariffs protected US industries (e.g., Smoot-Hawley Act, worsened Great Depression).
- Post-WWII: Shift toward freer trade via agreements like GATT.
Principles of GATT
- Nondiscrimination: Most-Favored-Nation (MFN) clause—equal tariff treatment for all trading partners.
- Freer Trade: Reduction of tariffs & non-tariff barriers, permissible restrictions for specific reasons (health, safety).
- Predictability: Binding tariffs, transparent policies for stability.
- Multilateral Negotiations: Among members to reduce barriers (e.g., Uruguay Round).
World Trade Organization (WTO)
- Successor to GATT, established in 1995.
- Key Functions: Administers trade agreements, facilitates negotiations, settles disputes via the Dispute Settlement Body.
- Membership: 164 member countries.
Trade Remedies and Protection Measures
- Safeguards: Temporary measures (quotas) protecting from import surges causing significant harm (e.g., Chinese textile imports).
-
Countervailing Duties (CVDs): Imposed on subsidized imports, compensating domestic industries, a 3-stage process.
- Petition filed alleging subsidies and injury.
- Commerce Department calculates subsidy amounts.
- ITC determines if subsidies caused harm to domestic market.
Anti-Dumping Policies
- Dumping: Foreign producers sell below cost or domestic price to gain market share.
- Anti-dumping duties: Counteracts dumping, protecting domestic industries from unfair competition.
Industrial Policies
- Purpose: Support strategic industries with future potential (e.g., technology, renewable energy).
- Tools: Subsidies (R&D, production), tax incentives, import restrictions (infant industry protection).
Challenges of Trade Regulations & Industrial Policies
- Balancing protectionism vs. free trade principles.
- Potential for trade wars (retaliation from trading partners).
- Ensuring WTO compliance whilst prioritizing national interests
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
Explore the complexities of trade regulations and industrial policies, focusing on their historical context in US trade policy. Learn about significant events like the Smoot-Hawley Act and the evolution toward the World Trade Organization (WTO), including principles established under GATT.
