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Protectionism - Coggle Diagram
Protectionism
Tariffs
Definition
A tariff is one form of protectionism employed around the world by governments to shelter domestic firms from cheap imports.
Example
EU Common Agricultural Policy (CAP). Despite reforms and some reduction in tariff rates, the EU still impose substantial tariff rates on many agricultural markets. The aim is to increase prices for domestic European farmers in order to increase their income
Embargo
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Example
The OPEC oil embargo also spurred ongoing oil conservation efforts and development of alternative energy sources. Today, the U.S. and its Western allies continue to support Israel in the Middle East conflict.
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Sunsides
Definition
A final tool available to government for promoting domestic production over imports is the protectionist subsidy.
Example
Subsidy of European airlines. For example, European airlines have been criticised for receiving ‘unfair’ support from their government. Though European governments respond they were just preventing the airline from going bust. This article from the Economist, suggests that the practice of subsidising European airlines has been declining.
Quotas*
Definition
Quotas are non-tariff barriers that are put in place to limit the number of products that can be imported over a set period of time.
Example
This is typically a less drastic action which has a marginal effect on prices and leads to higher demand for domestic businesses to cover the shortfall