free trade

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Free Trade

The state in which there are few or no tariffs or other trade barriers discouraging international trade. For example, a country with a free trade policy does not subsidize favored industries in order to make them less expensive compared to international competitors. Proponents of free trade argue that it is more economically efficient and helps consumers by promoting competition to keep prices low. Critics contend that free trade is detrimental to local jobs, especially in the developed world.

free trade

the EXPORT and IMPORT of goods and services between countries totally unhindered by restrictions such as TARIFFS and QUOTAS. In general, free trade leads to a higher level of economic welfare in so far as it favours the location of economic activities in those countries best suited to their production, resulting, through the trade mechanism, in worldwide consumption gains in the form of lower prices and greater product availability. See INTERNATIONAL TRADE, TRADE INTEGRATION, WORLD TRADE ORGANIZATION.

free trade

the INTERNATIONAL TRADE that takes place without barriers, such as TARIFFS, QUOTAS and FOREIGN EXCHANGE CONTROLS, being placed on the free movement of goods and services between countries. The aim of free trade is to secure the benefits of international SPECIALIZATION. Free trade as a policy objective of the international community has been fostered both generally by the WORLD TRADE ORGANIZATION and on a more limited regional basis by the establishment of various FREE TRADE AREAS, CUSTOM UNIONS and COMMON MARKETS.

See GAINS FROM TRADE, EUROPEAN UNION, EUROPEAN FREE TRADE ASSOCIATION, TRADE INTEGRATION.

References in periodicals archive ?
Nonetheless, and compared with the climate change only scenario, there is little change in terms of technical efficiency effects as the latter mainly captures the impacts of climate-induced productivity shocks, which do not change under the different trade liberalization scenarios.
First, we suggest that it is useful to integrate the theoretical predictions from the I-P literature of EM MNEs with those from the macro-economics literature on trade liberalization of MNEs.
The positive examples, as cited by Mike Pullen, are also often misrepresented as success stories of trade liberalization, whereas they actually represent the proof of strong government involvement, a wide range of targeted policies, subsidies, tariff protection and non-compliance with intellectual property rules, to ensure competitiveness before trade liberalization is embarked upon.
Hence, trade liberalization in other sectors as well as in forest products sectors is likely to affect forest products industries and trade.
To fully implement the Shanghai accords, Fox stressed the need to strengthen monitoring instruments to ensure APEC members are in line with the trade liberalization and facilitation process.
Trade liberalization may, for instance, reduce market failures, which are responsible for inefficient allocation of scarce resources and, therefore, for wasting environmental resources.
Trade liberalization, by making faster growth possible, can increase environmental damages through this "scale effect.
If the WTO is to facilitate trade liberalization rather than complicate it, an overhaul in political strategy is needed.
12 Kyodo Russia does not plan to join an APEC initiative that will speed up trade liberalization in nine sectors, immediately after it joins the regional grouping later this week, a senior Russian official said Thursday.
The bad news is that some displaced workers will experience unemployment and lower wages as a result of trade liberalization.
Consequently, "A capital market liberalization undertaken before trade liberalization, and the adjustment to it, are well advanced is thus likely to make trade liberalization unsustainable.
Previously, Uranga was Deputy Chief of Staff and then Chief of Staff for Mexican Commerce and Trade Secretary Herminio Blanco, where he actively participated in implementing NAFTA and in negotiating key agreements with the Mexican government as part of the country's trade liberalization.