International Trade Flashcards
What is the significance of mercantilism on international trade?
Mercantilists emphasize relative power and the importance of economic transactions lying in the implications for the military.
What is mercantilism?
Shares with realism the belief that each state must protect its own interests at the expense of others.
What does WTO stand for and what is it?
World Trade Organization. A global, multilateral IGO that promotes, monitors, and adjudicates international trade.
What does the WTO do?
The WTO shapes the overall expectations and practices of states regarding international trade.
What is the comparative advantage?
Substantial gains can be realized through trade
Why is comparative advantage important?
Each state should specialize in producing the goods for which it has a comparative advantage and then trade for goods that another state produces best.
What are non-tariff barriers?
A way of discouraging imports.
Why are non-tariff barriers important in trade?
Their use has risen sharply after the WTO rules led to a very significant reduction in tariff use. Some non-tariff trade barriers are expressly permitted in very limited circumstances, when they are deemed necessary to protect health, safety, sanitation, or depletable natural resources
What is the most favored nation (MFN)?
The trade restrictions imposed by a WTO member on its most-favored trading partner must be applied equally to all WTO members.
What is the generalized system of preferences?
Rich states give trade concessions to poor ones to help their economic development.
Why does the generalized system of preferences matter?
Preferences amount to a promise by rich states to allow imports from poor ones under lower tariffs than those imposed under MFN.
