Beggar-thy-neighbor

(redirected from Beggar-Thy-Neighbor Policy)

Beggar-thy-neighbor

An international trade policy of competitive devaluations and increased protective barriers that one country institutes to gain at the expense of its trading partners.

Beggar-Thy-Neighbor

A protectionist policy involving the devaluation of one's currency and the construction of tariffs barriers on other countries. The goal of a beggar-thy-neighbor policy is to increase demand for a country's exports (by devaluing the currency and making a country's goods less expensive in other countries) while also reducing demand for the countries imports (by making them more expensive through the tariff barriers). A form of this policy, notably the tariff barrier, was implemented at the beginning of the Great Depression with almost no success. A beggar-thy-neighbor policy in the United States caused other countries to follow suit, resulting in a massive decrease in international trade. This made the Depression worse. See also: Smoot-Hawley Act.
References in periodicals archive ?
Abe's beggar-thy-neighbor policy is leading Japan up a blind alley, where it will be a pariah in the international community.
This is the strongest proof that currency undervaluation, especially for a large country, is a beggar-thy-neighbor policy," he says.
The legacy today is a Fed policy that is increasingly viewed as a beggar-thy-neighbor policy to gain competitive advantage for its exporters.
Using the renminbi to settle China's international trade accounts would help China escape America's beggar-thy-neighbor policy of allowing the dollar's value to fall dramatically against trade rivals.
Because foreign producers lose out under this import tariff, it is sometimes called a beggar-thy-neighbor policy.
Countries employed another, seemingly only slightly less pernicious beggar-thy-neighbor policy during the Great Depression.
If this target were implemented, the yen might weaken, but this would not be evidence of a beggar-thy-neighbor policy but rather--as emphasized by Lars Svensson (2003) at Princeton--as part of an effort to anchor expectations in a way consistent with reflation.
The temptation in this type of recession, however, is to use the beggar-thy-neighbor policy by devaluing the currency.