NAFTA has its positives and it’s negatives for all three countries. One effect would be the US and Canada moving production to Mexico because it is far cheaper. Moving production from the US to Mexico is moving from wages if $42-58 and hour to $8-10 an hour. Some may argue that this is taking advantage of Mexico. This allows for Mexico to the positive if inward investment and increases the employment. The US and Canada would benefit from the fact the citizens of Mexico now have more money to import goods from the US and Canada. Mexico, Canada, and China are now the three biggest countries the US does business with. Mexicos labor productivity increase by 50%. Within the first ten years all three countries have seen firm productivity growth. I think NAFTA is great for Canada, Mexico, and the US. Free trade, no tariffs on 99% of goods, removal of barriers, and protection of intellectual property rights. The only part I view as a red flag is the amount of jobs that are lost to Mexico. The cheap labor steals jobs from the US each year. The movement of jobs from the US to Mexico means someone here in the US doesn’t have a job or the means to provide for themselves or their families. Also the lack of environmental laws in Mexico leaves tons of pollution in Mexico like the smog in Mexico City or the sludge in the Rio Grande. There are something’s that need to be worked on in NAFTA, however I think all three countries definitely benefit in their own ways.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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NAFTA has its positives and it’s negatives for all three countries. One effect would be the US and Canada moving production to Mexico because it is far cheaper. Moving production from the US to Mexico is moving from wages if $42-58 and hour to $8-10 an hour. Some may argue that this is taking advantage of Mexico. This allows for Mexico to the positive if inward investment and increases the employment. The US and Canada would benefit from the fact the citizens of Mexico now have more money to import goods from the US and Canada. Mexico, Canada, and China are now the three biggest countries the US does business with. Mexicos labor productivity increase by 50%. Within the first ten years all three countries have seen firm productivity growth. I think NAFTA is great for Canada, Mexico, and the US. Free trade, no tariffs on 99% of goods, removal of barriers, and protection of intellectual property rights. The only part I view as a red flag is the amount of jobs that are lost to Mexico. The cheap labor steals jobs from the US each year. The movement of jobs from the US to Mexico means someone here in the US doesn’t have a job or the means to provide for themselves or their families. Also the lack of environmental laws in Mexico leaves tons of pollution in Mexico like the smog in Mexico City or the sludge in the Rio Grande. There are something’s that need to be worked on in NAFTA, however I think all three countries definitely benefit in their own ways.

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