Answer to Question #47016 in Microeconomics for Yoyo
Opening an economy to trade makes everyone in the economy better off.Please explain in detail why this statement is true/false.
Opening an economy to trade can make a lot of firms and companies in the economy better off, but not all of them, because some national producers may be better off without free trade. Arguments for protectionism fall into the economic category (trade hurts the economy) or the moral category (the effects of trade might help the economy, but have ill effects in other areas); a general argument against free trade is that it is colonialism or imperialism in disguise. The moral category is wide, including concerns of destroying infant industries and undermining long-run economic development, income inequality, environmental degradation, supporting child labor and sweatshops, race to the bottom, wage slavery, accentuating poverty in poor countries, harming national defense, and forcing cultural change. So, this statement is false.