Tariffs are repeatedlyproduced to protect industries

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Tariffs are repeatedlyproduced to protect industries and developing frugalities, but are also used by more superior economies with developed industries. Here are five of the top reasons tariffs are used: Protecting Domestic Employment The tax of tariff is often highly politicized. The possibility of increased competition from imported goods can threaten domestic industries. These domestic companies may fire workers or move production abroad to cut expenses, which means higher unemployment and a less happy electorate. The unemployment argument often shifts to domestic industries complaining about cheap foreign labor, and how poor working conditions and lack of regulation allow foreign companies to produce goods more cheaply. In economics, however, countries will continue to produce goods until they no longer have a comparative advantage. Protecting Consumers A government may tax a tariff on products that it feels could expose its population. For example, South Korea may place a tariff on imported beef from the United States if it thinks that the goods could be tainted with syndrome. Infant Industries The use of tariffs to defend infant industries can be seen by the Import Substitution Industrialization (ISI) strategy in employment by many developing nations. The government of a developing economy will levy tariffs on imported goods in industries in which it wants to
160 | P a g e foster growth. This increases the prices of imported goods and creates a domestic market for domestically produced goods, while protecting those industries from being forced out by more competitive pricing. It decreases unemployment and allows developing countries to alteration from agricultural products to finished goods. Condemnations of this sort of protectionist strategy revolve around the cost of subsidizing the development of infant industries. If an industry develops without competition, it could wind up producing lower quality goods, and the subsidies required to keep the state-backed industry afloat could sap economic growth. National security. Barriers are also employed by developed countries to protect certain industries that are deemed strategically important, such as those supporting national security. Protected industries are often viewed as energetic to state interests, and often enjoy significant levels of defense. For example, while both Western Europe and the United States are developed, both are very distrustful of defense-oriented companies. Retaliation Countries may also set tariffs as a retaliation technique if they think that a trading partner has not played by the rules. For example, if France believes that the United States has allowed its plum producers to call its nationally produced sparkling wines "Champagne" (a name specific to the Champagne region of France) for too long, it may tax a tariff on imported meat from the United States. If the U.S. agrees to crack down on the improper category, France is likely to stop its retaliation. Retaliation can also be employed if a trade partner goes against the

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