Free Trade in the World Today

    Outsourcing is when companies manufacture products or have work done in other countries to decrease the cost of production.  Most major corporations and companies outsource to countries that have no child labor and minimum wage laws.  This decrease in cost of production allows companies to sell their product for more of a profit.  This ties into free trade because outsourcing is a good/service and many people believe that labor is part of the comparative advantage.  Corporations, companies, and cheap-labor workers believe that there should be free trade when it comes to outsourcing.  Although corporations agree there should be free trade with outsourcing, they vary in their opinion when they sell their products.  Outsourcing is a major part of free trade and it seems to be a great advantage of free trade.

    When it comes to free trade, there are many advantages and disadvantages to it.  Some advantages to free trade include: outsourcing and the comparative advantage.  Outsourcing is an advantage to free trade since it allows for companies to produce their goods for less giving them a comparative advantage.  The comparative advantage is an advantage to free trade since that is what free trade is based on.  You make the goods you can and import the ones you can not make.  This makes sure that free trade balances out all of the products imported and exported.  Outsourcing and the comparative advantage make free trade a very viable option for the global economy, but there are disadvantages to free trade.

    Free trade, although in theory sounds flawless (as do most plans), has its disadvantage.  The disadvantage to free trade is the imbalance of the comparative advantage.  Some countries will have the comparative advantage of many products, while one country could have a comparative advantage over no products.  This imbalance could cause countries to become extremely poor, since they have nothing to export, while other countries become rich since they can export many different things.

    While weighing all the advantages and disadvantages of free trade, it has come to the conclusion that free trade would greatly benefit the global economy, and it should be suggested.  Free trade would allow countries to produce what they are good at and import the things they can not make.  This would  allow everyone to have the things they need, without all the tariffs and restrictions that end up bankrupting countries.  Although it has one flaw, it would only affect a handful of small, insignificant countries.  Free trade would help the global economy immensely.  Free trade is a very plausible plan for the global economy.

    All in all, free trade is a great thing for the global things.  There are countries and organizations against it, but slowly they will realize that the organizations supporting it were right.  Free trade is uncommon, but it is spreading, even though slowly.  Free trade is the way nature meant for international trade to be done.  Free trade is the natural way for things to be done, and nature has done a good job with everything else, so it should do the same with free trade.

Bibliography

1. “Free Trade.”  Grolier Multimedia Encyclopedia. 2005. Grolier Encyclopedia. Retrieved 14 February 2005.

2. “North American Free Trade Agreement.”  Encyclopedia Americana. 2005. Grolier Encyclopedia Americana . Retrieved 14 February 2005.

3. “The ins and outs of Outsourcing.” eLibrary. 2005. Business Communicates Review.  Retrieved 14 February 2005.

4. “World Trade Organization.” Encylopedia Americana. 2005. Grolier Encyclopedia Americana . Retrieved 14 February 2005.