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 ?
His "America first" slogan is nothing less than a beggar-thy-neighbor policy.
These would result in a beggar-thy-neighbor policy and a virtuous cycle of thin rice trade that can contribute significantly to a poverty trap.
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.
Longer-term, the pure fiat money system exposed the rest of the world to what Steil and Hinds (2009: 200) term a monetary conflict of interest within the Fed: "The money it creates is both a domestic currency and international one, and the objectives of each of the aspects of the dual role can and frequently do clash." 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.
It is useful to recall the state of the world economy during the great depression and the destructive trading situation, often referred to as the beggar-thy-neighbor policy. This policy of then mostly developed countries consisted of imposing protective tariffs in hope that this would stimulate the depressed internal conditions.
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.