Pestle Analysis - Marketing Plan
SCHOOL OF BUSINESS
Course Name : International Business
Course Code : CSAD 471
Student Name : Francis K. Adu-Boahen
Index No : 10135024
Mid-Semester Assignment
ANSWER 1
International trade allows a country to specialize in the manufacture and export of products or services that it can produce or services efficiently, and import products that can be produced more efficiently in other countries
The various theories have differing prescriptions for government policy on trade. Mercantilism makes a crude case for government involvement in promoting exports and limiting imports. Smith, Ricardo, and Heckscher-Ohlin promote unrestricted free trade.
Mercantilism is a bankrupt theory that has no place in the modern world. Discuss.
In its purest sense, mercantilism is a bankrupt theory that has no place in the modern world. The principle tenant of mercantilism is that a country should maintain a trade surplus, even if that means that imports are limited by government intervention. This policy is bankrupt for at least two reasons. First, it is inconsistent with the general notion of globalization, which is becoming more and more prevalent in the world. A policy of mercantilism will anger potential trade partners because it will exclude their goods from free access to the mercantilist country’s markets. Eventually, a country will find it difficult to export if it imposes oppressive quotas and tariffs on its imports. Second, mercantilism is bankrupt because it hurts the consumers in the mercantilist country. By denying its consumers access to either “cheaper” goods from other countries or more “sophisticated” goods from other countries, the mercantilist country’s ordinary consumers suffer.
The theory of comparative advantage suggests that a country should specialize in producing those goods that it can produce most efficiently, while buying goods that it can produce relatively less efficiently from other countries. Furthermore, the
Course Name : International Business
Course Code : CSAD 471
Student Name : Francis K. Adu-Boahen
Index No : 10135024
Mid-Semester Assignment
ANSWER 1
International trade allows a country to specialize in the manufacture and export of products or services that it can produce or services efficiently, and import products that can be produced more efficiently in other countries
The various theories have differing prescriptions for government policy on trade. Mercantilism makes a crude case for government involvement in promoting exports and limiting imports. Smith, Ricardo, and Heckscher-Ohlin promote unrestricted free trade.
Mercantilism is a bankrupt theory that has no place in the modern world. Discuss.
In its purest sense, mercantilism is a bankrupt theory that has no place in the modern world. The principle tenant of mercantilism is that a country should maintain a trade surplus, even if that means that imports are limited by government intervention. This policy is bankrupt for at least two reasons. First, it is inconsistent with the general notion of globalization, which is becoming more and more prevalent in the world. A policy of mercantilism will anger potential trade partners because it will exclude their goods from free access to the mercantilist country’s markets. Eventually, a country will find it difficult to export if it imposes oppressive quotas and tariffs on its imports. Second, mercantilism is bankrupt because it hurts the consumers in the mercantilist country. By denying its consumers access to either “cheaper” goods from other countries or more “sophisticated” goods from other countries, the mercantilist country’s ordinary consumers suffer.
The theory of comparative advantage suggests that a country should specialize in producing those goods that it can produce most efficiently, while buying goods that it can produce relatively less efficiently from other countries. Furthermore, the