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Chapter 34: Q. 26RQ (page 832)

Is international trade likely to have about the same effect on everyone's wages?

Short Answer

Expert verified

No, international trade does not have the same effect on everyone's wages.

Step by step solution

01

Definition

When the exchange of goods is done from one country to another it is called international trade.

02

Explanation

When the international trade increases it provides an opportunity to increase output produce due to which the employees can earn higher wages whereas some employees fail to meet the productivity target due to which their wages decrease. Thus, international trade increases wages for some employees and decreases wages for some employees.

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Most popular questions from this chapter

Show graphically that for any tariff, there is an equivalent quota that would give the same result. What would be the difference, then, between the two types of trade barriers? Hint: It is not something you can see from the graph.

If opening up to free trade would benefit a nation, then why do nations not just eliminate their trade barriers, and not bother with international trade negotiations?

What is dumping? Why does prohibiting it often work better in theory than in practice?

Name several of the international treaties where countries negotiate with each other over trade policy.

Why might a tax on domestic consumption of resources critical for national security be a more efficient approach than barriers to imports?
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