International_Trade_Debt

International Trade Debate International Trade Debate By the United States placing high tariffs and using quotas consumer surplus is decreased and deadweight loss is introduced. Moreover, tariffs allow domestic suppliers the opportunity to compete with the global economy. The strength of the dollar fluctuates depending on the price of goods in the domestic and global economy. Tariffs are used in the international trade market to control the strength of the dollar in the global and domestic economy; consequently there are benefits and losses for consumers and producers from tariffs. First, if the price of goods determines revenue and international trade affects the economy by introducing comparative advantage; the strength of the dollar will fluctuate when international trade is introduced. Benefits from international trade are that consumers can import and export goods. Consequently, producers can not charge more then the world price of a good. If the producer charges more than the world price the consumer will import the good for the lower cost. With the presence of expansions and contractions in any business cycle the need for government interference is necessary to regulate such components through policies. In fact, tariffs are a lot like any policy introduced by the government. Tariffs regulate the expansion and contraction of producer’s surplus. Additionally the cost of the raw material and labor determine the cost, which also affects the strength of the dollar. However, the open market is much more economically efficient and the strength of the dollar will constantly fluctuate as long as international trade is present. The tariffs create obstacles in the open market that also affect the strength of the dollar. Moreover, the consumer loss from tariff is transferred back to the producer and the producer also losses the opportunity to produce another good. In conclusion, tariffs help regulate the strength of the dollar in the global and domestic economy. However there are always benefits and losses to any business cycle such as the economy. International trade gives the economy much more efficiency then a closed market even though the tariffs are fluctuating the strength of the dollar.