International Trade and Multiculturalism

Question One 

The continuous importation and acceptance of foreign goods in the U.S markets creates a pathway for international trade. The merits and demerits is faced by both the workers and the consumers. As advantages, the consumers gets to enjoy variety of goods not available in the country at the moment. It also allows the maximum usage of available natural resources. Specialization in production is encouraged. Moreover, goods can be produced at a comparatively low cost by taking advantage of division of labor. Surplus goods can be as well exported to other countries where demand is high. International competition as well creates a platform for quality goods at a minimum cost which benefits the consumers. Commercial interaction encourages exchange of ideas and culture which consequently results to cooperation, understanding, cordial relations and business expansion. The disadvantages of international trade include the adverse effect it has on local industries. Due to foreign competition and unrestricted imports, the upcoming industries may collapse. The economic dependence of developing countries on developed countries leads to economic exploitation of the developing countries. This can be boosted by the fact that these countries are sometime subjected to slavery and subjugation. These kind of interactions may lead to foreigners settling in America or vice versa endangering international peace which in the long run might result to war (McKenzie, 1954). 

Question Two 

Once a local industry feels threatened, it calls upon the congress to impose tariffs or outright ban on foreign competitors’ imports. This move always causes a tradeoff between workers and consumers due to the fact that it results to an increase in import prices. Another disadvantage is the fact that the affected countries retaliate by increasing their tariffs on similar products in their countries leading to an economic spiral such as the 1929 Great Depression. The act of protectionism leads to reduce trade between countries. Tariffs also reduce trade and increase price therefore robbing the consumer the pleasure of purchasing from a variety. As an advantage, it helps increase government revenue. According to research, as of 2008, approximately two percent of government revenue was accounted for by customs and imports duties. Tariffs lead to the promotion of American products since they tend to increase the price of foreign merchandises (Jones, 1961). 

Question Three 

Free trade agreements have the task of regulating tariffs, taxes and duties that are imposed on imports and exports by different countries. In the U.S, there exist several which include North American Free Americas Agreement (NAFTA), Transatlantic Free Trade Area (TAFTA), Free Trade Area of the Americans (FTAA) and the Transpacific Partnership. The advantages of these unions include the expansion of economic growth and the increase in dynamic business climate due to the motivation of local industries. The government spending has similarly been reduced due to the removal of local industry segments subsidies. There is likewise an increase in foreign direct investment including the syphoning of global expertise in local companies. Multiculturalism as well as diversity therefore grows in the local industries. The disadvantages come in handy with the increase in job outsourcing, one of the major criticism of NAFTA. Lower-priced domestic knockoffs always steal the intellectual properties of corporations. The crowding in the domestic markets lead to unemployment, crime, poverty and grueling jobs in sub-standard conditions especially for women and children. Ultimately, there will be erosion of indigenous cultures especially with the uprooting of the local people due to trade expansions (Jones, 1961). 

Question Four 

Foreign trade between Americans and other countries has led to cultural interaction. It has been easier to increase standards of living amidst employment competition. Through creativity and innovation, Americans have been able to exchange their cultures for foreign ones in the context of globalization. Global diversity has been threatened with the loss of distinctive features. As an entrepreneur, the best way to increase cross cultural businesses is learning how to communicate both verbally and nonverbally in different cultures. Taking time to observe their norms and ethics will expand knowledge as well as build understanding. Being sensitive to the unique features of their culture would also expand rapport. Flexibility and self-awareness in such areas is important so as not to lose focus. With these qualities, appreciating different cultures and being gentle to them as well as inquiring when need for clarification arises are recommendation for the acceptance and the understanding of different cultures. 

References 

Jones, Ronald. (1961). “Comparative Advantage and the Theory of Tariffs”. The Review of Economic Studies. 28 (3): 161-175. 

McKenzie, Lionel. (1954). “Specialization and Efficiency in World Production”. The Review of Economic Studies. 21 (3): 165-180.