Trade barrier

  • trade barriers are government-induced restrictions on international trade.[1]

    economists generally agree that trade barriers are detrimental and decrease overall economic efficiency; this can be explained by the theory of comparative advantage.

    most trade barriers work on the same principle: the imposition of some sort of cost (money, time, bureaucracy, quota) on trade that raises the price or availability of the traded products. if two or more nations repeatedly use trade barriers against each other, then a trade war results. barriers take the form of tariffs (which impose a financial burden on imports) and non-tariff barriers to trade (which uses other overt and covert means to restrict imports and occasionally exports).

    in theory, free trade involves the removal of all such barriers, except perhaps those considered necessary for health or national security. in practice, however, even those countries promoting free trade heavily subsidize certain industries, such as agriculture and steel.

  • overview
  • impacts of trade barriers on business
  • examples of free trade areas
  • see also
  • useful databases on trade barriers
  • references

Trade barriers are government-induced restrictions on international trade.[1]

Economists generally agree that trade barriers are detrimental and decrease overall economic efficiency; this can be explained by the theory of comparative advantage.

Most trade barriers work on the same principle: the imposition of some sort of cost (money, time, bureaucracy, quota) on trade that raises the price or availability of the traded products. If two or more nations repeatedly use trade barriers against each other, then a trade war results. Barriers take the form of tariffs (which impose a financial burden on imports) and non-tariff barriers to trade (which uses other overt and covert means to restrict imports and occasionally exports).

In theory, free trade involves the removal of all such barriers, except perhaps those considered necessary for health or national security. In practice, however, even those countries promoting free trade heavily subsidize certain industries, such as agriculture and steel.