Applied Theory of Economics Essay Example | Topics and Well Written Essays - 1000 words

Applied Theory of Economics - Essay Example China and India have progressed exponentially, with current estimates clearly showing how they would be the worlds biggest economies in sheer volume by 2050.Countries like South Korea, Taiwan & Singapore, once minor shipping ports are now among the economic elites of the world, on par with any developed nation today. These spectacular developments have been due to the great flexibility the capitalist system has demonstrated in granting everyone a stake in this brave new world. But with all that being said it also has a dark side attached to it as well. Poor nations with poor legislation on labor rights, wages, health & safety, poor government monitoring and manipulation by many rogue corporations over the ages have put into question the humanitarian aspect of trade. Arguing that corporations shifting production capacities elsewhere are susceptible to exploit the labor and other available resources of their host countries. In my humble opinion ,with the exception of a few highly publi cized cases, the net result of free trade for the developing world has been beneficial .It has alleviated poverty on national levels, led to transfer of modes of technology & made the world more cosmopolitan and integrated . Below are some of the arguments that in my opinion reflect very favorably on the effect of free trade on the developing world. Free trade is not just an economic practice it's a way of life, a political philosophy. "A major source of objection to a free economy is precisely that it [...] gives people what they want instead of what a particular group thinks they ought to want." (Friedman, n.p.) Below are in my opinion some points that argue favorably in the case of free trade for the developing world. Free Trades Alleviates Poverty More cannot be said of free trades vitality in increasing the fortunes of developing world. With the every specific shift of a production capacity in that particular or municipality a steady stream of labor is required. By gaining employments workers get means for their livelihoods and purchasing power. The cumulative effect is on a national scale. One can look no further than the birth of middle class in China & India. They alone have been a major factor in stimulating their local economies with their spending patterns. Free Trade Removes Likeliness of War it's no secret that all commerce flourishes in peaceful times. Especially in this integrated world when there are vested interests in another countries well being. Although the incidence of war hasn't been totally eliminated, by and large majority of the world the developing world has enjoyed prosperity over the decades. In fact, so many nations have entered into regional pacts to gain access to each others markets, to remove import quotas & for freer flow of resources in between their borders. All of these points which are the cornerstone of the Free Trade phenomenon. And in turn Organizations geared towards the free market ideal such as NAFTA (North American Free Trade Organization), EU (European Union) & WTO (World Trade Organization) have shown resounding success since the time of their