Free Trade – Why Is Regulation a Good Thing? Essay Example

Free trade, by definition, is the ability for countries to accept imports from all other nations and to send exports to other nations without restriction. In this manner, countries are able to exchange their natural resources in a manner that creates clear benefits for business across the world due to the availability of finished or unfinished goods. However, free trade is not without global trade regulation. In a majority of cases, there are tariffs, or taxes, on imports into foreign countries in an attempt for the government to make income as a consequence of trade. In this manner, both the country and its merchants can benefit from the business deals that are made. In spite of these apparent benefits, many people believe that regulation is not a good thing because it limits the ability of businesspeople to trade as freely as they would want to.

Despite some of the criticisms issued against free trade, it is important to consider that government regulation is a major component of what makes trade truly possible. One positive outcome of regulation is the subsidies that governments are able to provide to businesses to help them become more successful. Subsidies can help provide weakened economies with a necessary boost to jumpstart their businesses and engage in trade practices, thereby acquiring an income of their own. In the real world setting, such strategies can be used to help the economies of countries such as Greece and Argentina. Having strong businesses has the potential to build and maintain strong economies.

It is also important to consider that governments place a lot of regulations not just on trade, but practices within their companies. In particular, governments typically establish minimum wages, workers’ rights, and more. These initiatives arguably impact businesses because it becomes slightly more challenging for them to raise profits when their employees benefit as well, but it is important to demonstrate that the quality of life in countries with these regulations in place are immensely greater than places in which workers have no protections. If the government did not have the ability to impose such regulations, then it is plausible that workers would get sick and regularly lose their lives due to dangerous working conditions. Fortunately, free trade regulations have made jobs safer, which is ultimately more beneficial for the company because happy workers tend to produce better products.

Overall, free trade isn’t technically free because it is not only subject to local trade regulation, but the culmination of policies implemented by countries around the world in addition to international agreements. However, it is important to consider that these regulations make it more possible for countries with distinct policies and ideas to come to terms about what their trade deals should entail. Thus, these regulations make trades more accessible, contributing to economic growth for a majority of trade partners involved. Individuals that argue that free trade doesn’t currently exist due to these stringent regulations are not correct. Countries still have the ability to choose their trade partners independently of many of the laws that are produced. Arguably there is some legislation, such as trade embargos, that do hinder free trade. However, to keep the system working properly, it would be beneficial to continue allowing countries to trade freely with whomever they choose in order to obtain the most reasonable trade deal.