The paper "Australia Economics - Protectionism" is a perfect example of a micro and macroeconomic case study. The Great Depression of the 1930s and the global economic crisis of 2008 marked some of the instances that prompted the emergence of the protectionist trade policies (Erixon & Sally 2010). Governments across the world import quotas, exchange controls and enforced tariffs to restrict the purchase of foreign products. These trade restrictions contributed to shrinking in world trade in the early 1930s and 2009 away from the economic crumple itself, and to a dull bounce back in trade after those years, in spite of the global economic improvement (Erixon & Sally 2010).
The emergence in protectionism is recognized, but the majority of accounts in that period, whether gathered from modern reports or past histories, demonstrate that trade policy was turned into chaos all over, with every country scrambling similarly to enforce a high level of trade barriers. Actually, there is a considerable difference in the level to which nations enforced protectionist measures. Whilst some nations increased their tariffs sharply and enforced draconian controls on the transactions regarding foreign exchange, others raised they're restricted on trade and exchange marginally (Tcha & Kuriyama 2002, p. 2).
This was exactly the case with the Australian automotive industry. Based on the information, this report identifies major impacts resulted from protectionists in the Australian automotive industry, associated industries, consumers, communities and the labor force. 2.0 Definitions According to Fouda (2012, p. 351), protectionism is defined as an economic policy of controlling trade between countries by means of modes like tariffs, restrictive quotas, and other government legislation on imported goods. Tariffs are taxes enforced on products imported in a country from foreign countries, resulting in high prices (Anderson & Neary 2005).
An alternative to controlling is to subsidize local producers. In simple terms subsidizing implies paying local producers to produce more products. 3.0 Impacts of Trade Protectionism in Australian In spite of the international trend moving towards free trade, a few favored industries in every nation have protected from the import competition (Anderson & Neary 2005).
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