Yes free trade is fair. The term free trade refers to a policy that is followed in the international market; in this the countries and the government do not take into consideration the restrictions on exports to other countries. It was established in the open markets. There are many advantages that are seen by taking into consideration free trade. One is the absolute advantage in which Smith suggested that it was not at all possible for all the nations to become rich by following mercantilism. This is because if export is done then it is import for other nation, so if all the nations take into consideration free trade then it will be beneficial for them to sustain the market. The second advantage of the free trade is comparative advantage in which one can easily compare the opportunity cost of producing goods in many countries. The law and principles that are closely related comes under comparative advantage and in this the agent will produce more and the consumption will be low (Bieler, 2016).
It is seen that free trade is globally beneficial. There are many unrealistic assumptions seen by taking into consideration simple model. The assumptions that are assumed in the simple world can be that there are only two countries but in the real world there are many countries and goods. The next assumption that is assumed is the income effect which is based on the income distribution within a country. There are many assumptions which are considered under simple model. So by these assumptions it is seen that free trade is beneficial in the real world in which many countries, goods, resources and rates are involved (Yarbrough and Yarbrough, 2014).
There are many benefits that are seen by taking into consideration free trade fair. The advantages of benefits that are analyzed are that the business climate has become more dynamic. The businesses have the motivation now to become the global competitors in the market. The second advantage that is seen is increased economic growth. In this the economic growth has taken rise and is increased in effective manner. The spending is also reduced by considering the government. There are many other subsidiaries that are removed and funds are put for the use. Also there are many markets that rely on farming for the employment. So by this enhancement is seen in the income level of the farmers. Business can easily expand and achieve their goals and objective by considering free trade (Raynolds, 2014).
Free trade fair also increased the product variety and reduced the cost. In this the goods are available in the global market. It has also enhanced the working pattern of the employees. Free trade means anyone can easily trade with each other in effective manner. The fairness of the trade depends upon the competition in the market between the buyers and the sellers. So by this we can easily say that free trade is fair and provide benefits in many ways.
References
Bieler, A., 2016. From ‘Free Trade’to ‘Fair Trade’: Proposals for Joint Labour Demands towards an Alternative Trade Regime. Challenging Corporate Capital: Creating an Alternative to Neo-liberalism, pp.31-41.
Raynolds, L.T., 2014. Fairtrade, certification, and labor: global and local tensions in improving conditions for agricultural workers. Agriculture and human values, 31(3), pp.499-511.
Yarbrough, B.V. and Yarbrough, R.M., 2014. Cooperation and governance in international trade: The strategic organizational approach. Princeton University Press.
