As A Result Of Trade Agreements Many Countries Have Replaced Quotas With

In economic theory, the cost of all factors of production that could cross borders would have an equal cost in all commercial countries if the factors of production are entirely mobile. This would mean that the basis of the comparative advantage for trade between countries would decrease and that there would ultimately be less international trade. Knowledge of the market and technology can result in future economic benefits if it is protected by legal rights such as copyright, a restriction of the trade agreement or a legal obligation on workers to respect confidentiality. Fourth, Western economic theory assumes that trade will be reasonably balanced over time. If this is not the case, it indicates that the deficit country will introduce products for which it would normally have a comparative advantage; If these products operate in sectors where production costs are falling, the sector could lose its competitiveness in global markets over time. Finally, there is some irony when the U.S. government or U.S. citizens question labour standards in low-income countries, because the United States is not the world leader in government legislation to protect employees. In Western European countries and Canada, the government guarantees all citizens some kind of national health care; the United States does not offer such a guarantee, but has moved to general health insurance coverage under the recent Affordable Care Act. Many European workers receive six weeks or more of paid leave per year; in the United States, vacation is often one to three weeks a year. If European countries accused the United States of using unfair labor standards to make American products cheap and announced that they excluded all U.S. imports until the United States adopted guaranteed national health care, added more national holidays and doubled the vacation time, Americans would be outraged.

But when American protectionists start talking about restricting imports from poor countries because of low wages and poor working conditions, they make a very similar argument. This is not to say that working conditions in income countries are not an important issue.

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