Beggar-thy-neighbor(redirected from Beggar Thy Neighbor Devaluations)
An international trade policy of competitive devaluations and increased protective barriers that one country institutes to gain at the expense of its trading partners.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
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.
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