Essays on Government Intervention in Trade Coursework

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Generally speaking, the paper "Government Intervention in Trade " is a good example of business coursework.   The essay gives an explanation of why there is the interaction of governments and businesses. It is through different motives that governments intervene in any activity taking place in trade. Among the political motives, there is the issue of imports and exports and at the same time the obligation of governments to protect domestic jobs with the aim of providing national security. In the economic motives, it is the responsibility of the government to act as a watchman over small industries until they realize the full growth where they can be exposed to other companies internationally.

Lastly, it is the task of the government to have cultural motives in order to maintain a national uniqueness and identity. There are therefore three motives that make a government be involved in a trade. In an international context, the government has to protect the domestic market where they come in to help when a trade is being faced with harsh economic conditions. To a greater extent, governments protect trade due to political motives where many trade decisions are based on political policies and some of them may include protection of jobs.

Among the political motives mentioned is the assurance of protection from harsh environments in the imports and exports sector. In a situation of imports, it is the work of the government to protect their industries. In the economic motive, it is the aim of the government to ensure the protection of infant industries against international competition. Finally, in the cultural motive, there will be a discussion of the protection of national culture. Political motives Taking the example of a country like China, they have Lucky film which competes against Kodak.

As a result of protecting the business that belongs to their country; they offered low-interest loans which eliminated joint ventures that would have seen Lucky film belonging to another country. Many goods have to be available in any country and this serves as a way of ensuring that there is employment all year round. It is also a political motive when the government wants to preserve security nationally(Menza, 2000). The development of industries indicates the level of national security there is in a country.

Governments, therefore, have to come up with subsidies and incentives to boost companies and this is the only way a country will generate more in terms of income hence a secured monetary future. With governments coming in to sponsor companies, there is an assurance of protection from harsh environments in the imports and exports sector. In a situation of imports, it is the work of the government to protect their industries(Bhanot and Kadapakkam, 2006). Taking the example of the agricultural sector, many countries will do anything to ensure that they are protected as this may be the only source of income being gotten internationally.

In the case of exports, it is the duty of the government to ensure that there is a restriction of goods that may harm a country and its citizens. Many governments restrict the export of defence-related goods as they can be used for the wrong purposes. It is also a political motive for the government to make it their responsibility to respond to other country's unfair trading practices.

This comes in when a country practices free trade; it may encounter unfair practices where a country can be taken advantage of in terms of exports and imports.

References

Bhanot, K. & Kadapakkam, P. (2006). Anatomy of a government intervention in index stocks: Price pressure or information effects?. Journal of Business 79 (2): 963–986

Dennis, P. & Strickland, D (2002). Who blinks in volatile markets, individuals or institutions?. Journal of Finance, 57, 1923–1949.

Kindleberger, C. P. (1978). Government and international trade. Princeton, N.J.: International Finance Section, Dept. of Economics, Princeton University.

Lehne, R. (2006). Government and Business: American political economy incomparative perspective.Washington, DC: CQPress.

Medema, S. G., & Boettke, P. J. (2005). The role of government in the history of economic thought. Durham: Duke University Press.

Menza, J. (2000).”Political sociological models of the U.S. new deal”.Annual Review of Sociology, 26, 297-322.

Peltzman, S. (1976). "Toward a more general theory of regulation". Journal of Law and Economics 19 (2): 211-240.

Reimer, J. & Stiegert, K. (2006). Imperfect competition and strategic trade theory: Evidence for international food and agricultural markets. Journal of Agricultural and Food Industrial Organization, 4 (6).

Su, Y. & Wong, R. (2002). “The impact of government intervention on stock returns: Evidence from Hong Kong”. International Review of Economics and Finance ,11, 277–297.

Teske, P.,Best, S.& Mintrom, M. (1994). "The economic theory of regulation and trucking deregulation: shifting to the state level" Public Choice 79: 247-256.

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