Discussion 6

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Purdue Global University *

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540

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Economics

Date

Nov 24, 2024

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Uploaded by SharkGirl97

Initial Post: October 27, 2023 Hello Everyone, I cannot believe we are already at the end of the term. It feels like we have covered such a vast amount of content in such a short period. I feel that I have strengthened my understanding of both macro and microeconomics and am eager to begin this discussion post. As I have done before, I have included the prompt questions below in bold and then outlined my answers to them below in regular typeface. Does free trade contribute to the improvement of economic well-being? How does trade stimulate long-term economic growth? Explain. In terms of economics, fair trade can be a contributor to economic growth because it enables imported and exported goods to and from different countries. It is commonly referred to as a treaty that dictates tariffs, duties, and taxes within the countries by regulating which of these and how much of these are imposed on the country's imported and exported goods. In this manner, free trade can generate jobs in new areas and increase the GDP when countries are trading goods with one another via importing and exporting methods. This is beneficial to the country because it is hoth brings funds and generates revenue in locations that may have had limited access to funding without the ability to execute trades. Who gains and losses from free trade among countries, and how do the gains compare to the losses? Explain using examples. While free trade is often referred to as positive, it can have a downside. One negative impact of free trade is it encourages the outsourcing of jobs. Many times, in the United States, it can be more cost-effective to outsource production to other countries, rather than keeping them internally. This cost-effectiveness only feeds the outsourcing which can harm the country's economy. A secondary disadvantage that I would like to identify is that free trade is only compatible with countries that do not have active patent laws. If a country has not protected itself against intellectual property theft, it can be negatively impacted by the free trade market. On the contrary, there are many notable advantages and positive effects of free trade. This includes an increase in technological developments, a decreased rate of government spending, and a larger group of industry experts. It is also worth noting that companies can save money when these same jobs are outsourced to other countries even though there are disadvantages to this tactic as well. Technological advancements happen when new technology is created and can help additional markets. Industry experts and knowledge can be utilized globally in efforts to help others achieve their business aspirations. Do you think the U.S. export and import of goods and services are based on the principle of comparative advantage of trade? Explain. The concept of comparative advantage in economics refers to when a country is capable of producing a good/ service at a lower opportunity cost when compared to other countries. Restrictions on imports and exports can be beneficial to a country’s comparative advantage because it gives them an advantage compared to other countries that do not have this.

Why do countries impose trade restrictions on goods and services they import from other countries? What are the pros and cons of trade protectionism? Restrictions and regulations on imported and exported goods for the United States. One restriction observed by the United States is the restriction on trade enforced through the United States Department of Commerce’s Bureau of Industry and Security commonly referred to as BIS. The BIS is the administrator of the United State’s regulatory laws and policies. They specifically govern the exportation and reexportation of goods and the selling of goods in certain categories. These goods include technology and software. Goods that fall into these two categories have additional requirements when being sold and exported. One downside of having these restrictions (of this type) is that it can limit the companies and harm profits, Despite this there is one big advantage of this. The upside is keeping the trade market protected for customers and companies to utilize for conducting business. What is the impact of free trade on domestic job creation policy? Elaborate with examples. Despite its benefits, the existence of free trade can hurt the jobs within a country. These jobs could potentially be outsourced to other countries and thus open opportunities for external countries to prosper. Though the other country would benefit from the new jobs, the home country (then the United States) would suffer an increased unemployment rate. As mentioned before however, despite the home country's suffering, other countries can benefit from the jobs created by the home country outsourcing jobs. In the United States, many clothing objects state that they are made in different countries, such as China or Vietnam. This means that while the United States is losing the opportunity to employ workers to produce this clothing, other countries are gaining the opportunity to employ a worker in these positions. Many companies participate in this type of outsourcing because the labor is much more cost-effective in these countries. For many companies, this rings true even when factoring in the cost of transporting such goods overseas. Thank you for reading my Unit Six initial post. I have had a great time in this class and am eager to read the discussions that this final post may spark. I wish you all luck in your future academic endeavors! Sincerely, Michayla Abrahams References McConnell, C., Brue, S., & Flynn, S. (2024). Economics (23rd ed.). McGraw-Hill Education. Response 1: October 28, 2023 Hello Adena,

Thank you for your well-developed post this week! I enjoyed reading it and decided to reply as it seems we have many similar ideas when addressing this week’s topics. One part of your post that I found particularly interesting is that you mentioned how common it is to find the words “made in China” written on different products in the United States. I notice this more on clothing than any other product due to the cost of sewing, textiles, and seamstress work in the United States. I wanted to ask if you noticed this as well, or if you notice it more on a different type of goods? I was also curious how you go about purposely seeking out merchandise made in the United States. Though I do not intentionally check before purchasing items, I have checked a few clothing tags in my closet and it seems nearly everything I own was made in a different country clothing-wise. If you have a different experience, how are you navigating shopping in a way that avoids this? Perhaps we shop in different locations and that is a contributing factor. What stores have you found that sell items made in the United States more frequently than in other countries? Essentially, I was just curious if you had any tips or tricks! I mainly buy my clothing from Costco, so that could be the issue as well. I am eager to see your feedback and wanted to thank you one last time for your initial post! I hope you are having a great weekend! Sincerely, Michayla Abrahams References McConnell, C., Brue, S., & Flynn, S. (2024). Economics (23rd ed.). McGraw-Hill Education. Response 2: October 29 th 2023 Hello Lauren, I enjoyed reading your post and felt that your responses were well constructed. I agree with many of your thoughts and feel you have a strong understanding of the course materials presented within Unit Six. I decided to reply to your post specifically because I noted that you mentioned the outsourcing of customer service. My first job out of college was at a customer

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service desk at a retail store so I am familiar with the set-up of being a customer service representative I can understand the incentive and ease companies experience when outsourcing this work as it can be much cheaper to operate in other countries. While my retail establishment did not opt to outsource this type of work to another country, they did eventually opt to outsource the service to remote workers to save money. This shift felt like it was made by similar motives that companies experience when opting to outsource to different countries. I can understand the lure of more cost-effective work but feel establishments never properly consider the cost vs level of service they may be getting for that money. When work is handled non-remotely and within the same country that they operate from they can have a more intentional impact on the customer experience and satisfaction being offered to the customer. If the employer can have a more active presence and conscious role in training their customer service providers they will have an easier time ensuring a higher performance from their customer service employees. I wanted to reply to your post to provide you with this insight I had on the outsourcing of customer service workers and inquire about your own relevant experiences. Do you feel the quality of service can be negatively impacted by outsourcing in a way that negates the potential savings? While the work may be cheaper in these areas, what happens if the lackluster workers turn off potential customers and negatively impact the company financially instead? What do you think? If you have the time this week to reply I am eager to see what you think and if your opinions align with my own or not. If you agree with me why and if you do not, why not? I hope you have a great week! Sincerely, Michayla Abrahams References McConnell, C., Brue, S., & Flynn, S. (2024). Economics (23rd ed.). McGraw-Hill Education.

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