Trade Liberalisation

The video discusses market-oriented strategies and trade liberalization, contrasting them with interventionist strategies. It highlights the Washington Consensus as a framework for policy reforms in developing countries. The benefits of trade liberalization, such as increased competition and innovation, are explored alongside challenges like structural industry decline and environmental impact. The concept of export-led growth is examined, emphasizing the importance of removing trade barriers and the role of floating exchange rates. The video concludes with a discussion on the future prospects of trade liberalization.

What is the primary focus of market-oriented strategies?

• Maximizing government intervention

• Increasing subsidies for inefficient producers

• Minimizing government intervention and maximizing market forces

• Minimizing the role of supply and demand

Which international example is used to illustrate market-oriented strategies?

• The Bretton Woods System

• The Paris Agreement

• The Washington Consensus

• The Kyoto Protocol

What is the main goal of trade liberalization?

• To increase trade barriers

• To restrict international trade

• To promote government subsidies

• To open domestic markets to foreign competition

Which of the following is NOT a type of trade barrier?

• Subsidies

• Quotas

• Regulations

• Tariffs

How does trade liberalization benefit developing countries?

• By limiting access to foreign markets

• By decreasing aggregate demand

• By reducing export opportunities

• By increasing domestic consumption

What is a potential challenge of trade liberalization for developing countries?

• Increased environmental damage

• Decreased specialization

• Lower living standards

• Reduced global competition

What role do floating exchange rates play in trade liberalization?

• They fix exchange rates to prevent fluctuations

• They allow currency depreciation to boost exports

• They stabilize currency values

• They are determined by government intervention

What is a benefit of countries engaging in trade liberalization?

• Increased specialization in efficient production

• Higher tariffs on imports

• Reduced global competition

• Decreased innovation incentives

Which organization is often involved in promoting trade liberalization?

• United Nations

• International Monetary Fund

• World Trade Organization

• World Health Organization

What is a potential downside of opening up to foreign competition?

• Increased domestic market growth

• Enhanced environmental protection

• Structural decline in certain industries

• Higher global prices