-
Finished your HSC? Check out our University Discussion, Non-School forums or help out next year's HSC students! -
YOU can help the next generation of students in the community! Share your trial papers and notes on our Notes & Resources page
reducing protectoin? (1 Viewer)
- Thread starter k150764
- Start date
LordPc
Active Member
reducing protection is great 
it exposes local businesses to international competition, which forces these local suppliers to become more efficient or risk losing customers
so this means that prices will go down
and all of this means that demand and supply will determine market price so there is a better allocation of resources
it might cause structural change, so if a country sucks at agriculture (like, I dunno, America or the EU, who suck pretty bad at agriculture) then reducing protection will force all these farmers who are very unproductive to get a job in an industry which America has an advantage over the rest of the world
there is probably more, check the textbooks, but basically protection is great
it exposes local businesses to international competition, which forces these local suppliers to become more efficient or risk losing customers
so this means that prices will go down
and all of this means that demand and supply will determine market price so there is a better allocation of resources
it might cause structural change, so if a country sucks at agriculture (like, I dunno, America or the EU, who suck pretty bad at agriculture) then reducing protection will force all these farmers who are very unproductive to get a job in an industry which America has an advantage over the rest of the world
there is probably more, check the textbooks, but basically protection is great