Many rich developed countries (like countries of the EU or the US have suffered

Question

Many rich developed countries (like countries of the EU or the US have suffered from inexpensive imports coming from Asia and other emerging countries. As a result, many industries and parts of sectors of our economies have disappeard since the onset of globalisation. Selected politicians in the rich countries are calling for tough measures to support local industries and protect employment in the West. Provide an educated explanation and opinion on these issues. What could or should be done in your view?

Explanation / Answer

In the current free global internationalization of trade , there is nothing wrong if the US and Europe are getting cheaper goods from Asian countries because it is the base of comparative advantage theory. Now asian countries comes with cheap labor and huge scale , so its better to import goods from them. It does not mean that there is no benefit for US and Europe, they can captalize on their technology capabilities and come up with better quality and work on other key techlogy driven processes.

Yes, if there is Dumping from China, in that case Dumping as it is bad for any global trade, then it makes sense to use import subsituation or tarriff measures to discourge trade from China

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