Sample Essay on Effects of Trade Barriers on Consumers
Trade barriers help serve economic and at times, political objectives though they can also lead to significant costs. These barriers are supposed to limit international trade, protect workers and domestic workers from competition by increasing the price of goods imported.
In this regard, there are those who argue import restrictions serve as tax on domestic workers. Other experts argue that the cost of protecting workers jobs in these vulnerable industries are ultimately borne by consumers or taxpayers and that they far exceed the cost of finding and retraining new jobs for workers.
The effects trade barriers have on consumers are far reaching and they vary from one country to another. While this is the case, the most important effect is that of increased costs. The cost of goods in any given country goes up as a result of trade barriers because the cost of imported products is artificially raised as well.
The Institute for International Economics indicates that American consumers, as a result of trade barriers spend $ 80 billion per year or over $1,200 per family as a result of increase product prices for instance sugar and other goods that are made from sugar as well as appliances crafted from steel.
The most apparent effect of these barriers is prevention of job loss to any foreign competition. This is an argument often used by a large section of the groups with special interest in different kinds of trade barriers. In the end though, they prove to be a great inconvenience for consumers because they force them to pay high prices for products that they could otherwise purchase at affordable costs. In the long run, consumers also end up buying products that are of substandard quality because they are forced to settle for the cheapest option.
Trade barriers make purchase of imported goods very costly as such consumers are not able to purchase the same. While this might work well for the domestic industry, it lessens competition from international markets and leaves consumers with few alternatives on the type of products to buy. It helps save jobs in the short time but producers in domestic markets don’t have the incentive to create products that are of high quality for the consumers.
Domestic producers are also more likely to use substandard materials when manufacturing their goods because they don’t have any competition. Despite the benefits associated with trade barriers, there is no question that consumers are worst affected by such barriers in the long run.
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