Lecture 8 - Robert Peel: The Free Trade Architect Flashcards
Define free trade and its features
Free trade includes:
- Minimal barriers like tariffs or quotas
- It promotes international competition and efficiency
Define Protectionism and its features
- Protectionism includes tools such as tariffs, quotas, subsidies and regulatory restrictions
- Protectionism aims to shield domestic industries from foreign competition
Does an import tariff hurt domestic consumers or domestic producers more?
An import tariff hurts domestic consumers more than domestic producers
In which country did Robert Peel act in?
The UK
What is mercantilism?
Mercantilism was based on the idea that a nation’s wealth and power were best served by increasing exports and reducing imports
When was mercantilism dominant in the UK?
It was dominant in the 16th -18th centuries
How did the UK favour mercantilism during the 16th-18th centuries?
Nations prioritized export surpluses to amass gold/silver
Example: Navigation Acts (UK, 1651-1849) restricted foreign ships’ trade to favour British merchants
How did the UK economy change from mercantilism?
The UK changed from mercantilism to free trade
How did the UK economy shift to free trade from mercantilism?
Shift to free trade: Adam Smith: Wealth of Nations advocated specialisation and competition
David Ricardo: Introduced comparative advantage, emphasising mutual gains from trade
What were the corn laws and when were they in place?
Corn Laws (1815-1846):
- Imposed tariffs on imported grain to protect British agriculture
- Resulted in high food prices and urban discontent
Explain Robert Peel’s reforms against the Corn Laws
Peel’s Reforms:
- Repealed the Corn Laws in 1846, despite opposition from his own Conservative Party
- Partly driven by the Irish potato famine (1845-1852), which caused mass starvation
What were the impacts of Robert Peel’s reforms on the UK economy?
Impact:
- Lowered food prices, benefitting working class consumers
- Positioned Britain as a leader in global free trade
