Free Trade


Advantages and Disadvantages of Free Trade

One of the most general arguments that is in favor of this type of trade is that free trade allows the company to effectively deal with the price of the different products and services in the market on the large scale. As government has put a lot of barriers to free trade – i.e.

taxes, duties and rules – that are lifted, according to experts the amount required to effectively provide the services or manufacturing of goods will reduce, and this decrease in price is an additional benefit for the entire society.

In common, production that is done on a large-scale is more advantageous as compared to production done on small-scale and provides more profits that drive more efficiency, plus more advanced expertise.

According to some political experts free trade by making the country so economically inter-reliant enhances national security threat due to which conflict develops into the more remote option.

Disadvantages of free trade:

Where there are advantages, there are also some disadvantages of free trade. According to some challengers of free trade, economic advantages of this trade are predominated by the costs that are hidden.

For instance, free trade is used to advertise the development of large businesses such as international business that gather their revenue at the operating cost of locals, smaller ventures.

Other than this, foreign capital is used to cut down young industries so that they will not bloom in developing countries, fostering a reliance on overseas companies and potentially destroy the competitiveness of many local firms.