C. Based on the text, make a list of disadvantages of free trade

ü job losses from offshore outsourcing

ü the destruction of middle class jobs and the dismantling of the ladders of upward mobility

ü the flow of resources to where they have absolute advantage does not result in mutual benefit

ü

ü

Assignment 8. Watch the program on free trade, summarize the participants’ views on trade policies and fill in the blanks in the following utterances.

1. According to a recent study, over the last half century, nations that were open to free trade experienced _______________________that was double that of those that were not. So why would anybody oppose free trade? And yet many, particularly in the developing world, do oppose free trade, believing that the rules of global trade are rigged in favor of the rich, developed north and against the poor, developing south.

2. The Nobel Prize winning economist Joseph Stiglitz: "The _________________ has been set by the north (that is by the rich countries) or more accurately by special interests in the north. Consequently a disproportionate part of the gains has ______to the advanced industrial nations. And in some cases the less developed countries have actually been worse off."

3. “What's so special about free trade? <…> Why should nations open their borders to trade?”

“Fundamentally it's a question of ____________. If I have _____toothpaste and you have _____ toothbrushes and if we exchange one of each, teeth are going to get whiter, provided we remember to brush our teeth”.

4.So it's the same argument that you'd make for the development of a nation's own economy. We should all simply specialize in the tasks that we tend to do best in which we have ____________. And the argument is the same among nations as it is among individuals or among firms?

5.Over the last half century, this OECD (Organization for Economic Cooperation and Development) report says, "Nations that have been more open to trade have experienced ____________ of those that have been closed." The OECD report goes on to draw a very sharp contrast between two regions of the world.

6.If you look at the East Asian economies, these were not free trade economies, these were hard hitting protectionist mercantilist economies with a great deal of ________, _________, _________, that in fact made them blockbusters on the world markets.

7. But essentially what the Far Eastern economies did, for instance, was to have a lot of _________. It was not a libertarian hands-off government, but the question was: what the nature of that intervention? They consistently routinely made it clear to their people that _________was the important way to go. And open economy in the sense that you are not fearful of world markets, not fearful of ___________, you use the external world to learn from it, to profit from it.

8. That the history of East Asia shows, you know, is that interventions, even protectionist interventions, in fact, __________ so that at a future time these countries like Korea, were able to become efficient, effective, economies. So what I'm saying here is that we really, really need to be ____________. There are times when you're a protectionist and that's the rational thing to do, there are times when you __________. But the important thing is ___________that guides you in terms of developing your economy.

(Source: Trading Places: Is Free Trade Faltering? Uncommon Knowledge, June 14, 2002)

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