International Trade Theory of NAFTA Research Paper by Master Researcher

International Trade Theory of NAFTA
An examination of NAFTA and its merits and drawbacks regarding international trade and the environment.
# 44002 | 3,056 words | 7 sources | MLA | 2002 | US


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Description:

This paper looks at the positions of opponents and supporters of NAFTA and explains the basis of NAFTA using international trade theories. The paper looks at how North American economic integration combined with expanded trade regulation internationalizes an increasing number of political and social issues that previously were addressed through purely domestic legal and social processes. The paper explores NAFTA and the environment and argues that it will never be possible to achieve complete agreement on most issues, but a more transparent and inclusive one must replace today's exclusive and secretive approach to international trade matters.

Outline:
Introduction
Need for NAFTA and Theories
The Opponents and Proponents of NAFTA
Creation of NAFTA
The Environment and NAFTA
The International Trade and Theories

From the Paper:

"Ricardo's Theory of Comparative Advantage predicts we would be better off with free trade as participants specialize in their areas of greater factor productivity's. The Heckscher Ohlin (HO) Theory agrees with this, and elaborates on it. The HO theory argued countries with different factor endowments could benefit from free trade. The theory shows that if one nation is capital abundant and another is labor abundant, each nation will specialize in producing goods that uses its most abundant resource.
"The U.S. is capital abundant, and Mexico is labor abundant. While greater output is predicted with free trade, it is also predicted that in the U.S., owners of capital will benefit while laborers will loose. However, the gains are large enough that if the winners would compensate the losers, all would still be better off. So, while gains from trade are predicted, there is still a valid argument for trade adjustment assistance in the U.S. In Mexico, it is predicted that laborers will gain at the expense of capitalists. The HO Theory model makes several assumptions, which are summarized below."

Cite this Research Paper:

APA Format

International Trade Theory of NAFTA (2003, October 26) Retrieved May 24, 2022, from https://www.academon.com/research-paper/international-trade-theory-of-nafta-44002/

MLA Format

"International Trade Theory of NAFTA" 26 October 2003. Web. 24 May. 2022. <https://www.academon.com/research-paper/international-trade-theory-of-nafta-44002/>

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