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Explore why the Trump Administration imposed tariffs on foreign steel and aluminum, who is helped and hurt by these tariffs, and the essential questions surrounding trade barriers. Discover arguments for protectionism, government actions to protect domestic companies, and various types of trade barriers such as tariffs, quotas, standards, subsidies, and embargoes.
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Video Clip Why did the Trump Administration impose tariffs on foreign steel and aluminum? Who is helped by theses tariffs? Who is hurt by these tariffs?
Trade Barriers Essential Questions: Why do some people advocate for protectionist measures? (What are the arguments in favor of protectionism?) What actions can the government take to protect domestic companies?
Trade Barriers • Tariffs, or customs duties, are the most common type of barrier to trade. A tariff is a tax that must be paid to the U.S. government when imports arrive in the U.S. This tax raises the price of imports and helps domestic producers of similar products.
Trade Barriers • Tariffs, or customs duties, are the most common type of barrier to trade. A tariff is a tax that must be paid to the U.S. government when imports arrive in the U.S. This tax raises the price of imports and helps domestic producers of similar products. • Quotas limit the amount of a product that can legally be imported. The reduction in the supply of the import available will create a shortage and cause the price of the good to rise. This allows domestic producers of the good to expand their production.
Trade Barriers • Tariffs, or customs duties, are the most common type of barrier to trade. A tariff is a tax that must be paid to the U.S. government when imports arrive in the U.S. This tax raises the price of imports and helps domestic producers of similar products. • Quotas limit the amount of a product that can legally be imported. The reduction in the supply of the import available will create a shortage and cause the price of the good to rise. This allows domestic producers of the good to expand their production. • Standards can also be used to limit foreign imports. For example, a country could require that agricultural products be closely inspected upon arrival, or that imported automobiles meet stiff mileage and pollution requirements. If such requirements are imposed in a discriminatory manner on imports, the cost of imports will rise in comparison to the cost of domestic products.
Trade Barriers • Tariffs, or customs duties, are the most common type of barrier to trade. A tariff is a tax that must be paid to the U.S. government when imports arrive in the U.S. This tax raises the price of imports and helps domestic producers of similar products. • Quotas limit the amount of a product that can legally be imported. The reduction in the supply of the import available will create a shortage and cause the price of the good to rise. This allows domestic producers of the good to expand their production. • Standards can also be used to limit foreign imports. For example, a country could require that agricultural products be closely inspected upon arrival, or that imported automobiles meet stiff mileage and pollution requirements. If such requirements are imposed in a discriminatory manner on imports, the cost of imports will rise in comparison to the cost of domestic products. • Subsidies lower costs for domestic producers. Although the creation of subsidies would appear to decrease prices and make domestic consumers better off, subsidies must be paid for by someone (taxes levied on all taxpayers). Everyone pays for the benefit given to producers of subsidized goods, whereas, tariffs only require those who buy the imported products to pay the costs of the tariff.
Trade Barriers • Tariffs, or customs duties, are the most common type of barrier to trade. A tariff is a tax that must be paid to the U.S. government when imports arrive in the U.S. This tax raises the price of imports and helps domestic producers of similar products. • Quotas limit the amount of a product that can legally be imported. The reduction in the supply of the import available will create a shortage and cause the price of the good to rise. This allows domestic producers of the good to expand their production. • Standards can also be used to limit foreign imports. For example, a country could require that agricultural products be closely inspected upon arrival, or that imported automobiles meet stiff mileage and pollution requirements. If such requirements are imposed in a discriminatory manner on imports, the cost of imports will rise in comparison to the cost of domestic products. • Subsidies lower costs for domestic producers. Although the creation of subsidies would appear to decrease prices and make domestic consumers better off, subsidies must be paid for by someone (taxes levied on all taxpayers). Everyone pays for the benefit given to producers of subsidized goods, whereas, tariffs only require those who buy the imported products to pay the costs of the tariff. • An embargo can be imposed to prohibit trade with a foreign country. This is usually used as a diplomatic punishment rather than as a way to protect domestic producers.
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