This article discusses the decision of the United States to take protectionist measures first against tire imports and after coated paper from both China and India. This decision comes after The Steelworkers trade union together with NewPage Corp paper manufacturers complained that they are having a very hard time given the cheap products that China and India import to the U.S. The U.S. International Trade Comission is going to analyze two important factors in order to make a decision. One argument for protectionism is China and India are dumping their products into the Unites States. Dumping means selling a large amount of products to a country at a lower price than in the country where the products are being dumped. This is a factor that affects the domestic production in that country as people prefer buying cheaper products which are the imported ones, not the domestic ones.
Economics 12 @ AISB
All Econ All the Time
3 comments
November 9, 2009 at 11:58 am
Sean Maley
Perfecto!
November 10, 2009 at 6:05 pm
marcomarco1
In general, your commentary is clearly set out and structured, so that it makes sense and appears logical. You touch upon various important issues including subsidies and tariffs and you do a good job at explaining and elaborating. However, especially in your first paragraph, you are quite descriptive – You could use that space to analyze more or be more specific concerning tariffs or subsidies. You could go into further detail for both protectionist measures and explain the effects on all stakeholders. Also, if you define economic terms it may be better to use to make in order to have a proper definition. Lastly, I realized that you did not evaluate much other than in your last, small paragraph. You could evaluate for both tariffs and subsidies by considering the long-term and shor-term as well as the order of importance of the effects of each on Chinese and Indian industries.
November 18, 2009 at 9:47 am
marcomarco1
More specifically, for tariffs and subsidies, consider foreign producers, domestic producers, changes in consumption due to prices, efficiency losses and the benefits or costs for the government. In the interest of doing this effectively you may want to include letters for the specific areas of your subsidy graph, so that you can more easily refer to them and explain the aftermath of the implemention of a subsidy. In order to enhance your evaluation section you could consider these effects in the long- and short-run. Also, it is important that you rank the consequences of the tariff/subsidy in order of importance, with regard to your specific case, as this will also strengthen your evaluation section. Additionally, to be more analytical you could consider arguments for protectionism, such as the protection of domestic employment, and arguments against, such as limited freedom of choice for consumers, so that you can value the arguments for protectionism against the ones which oppose it (regardless of the fact that you have already touched upon arguments against protectionism). Finally, you may want to look at potential solutions, such as consulting the WTO, and if you have sufficient space, the limitations and benefits of the WTO in order to evaluate to what extent such a solution may be advisable.
P.S.: In the above comment I meant to say that you should use the textbook for your definitions, as your definitions are not very precise.