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I'd guess that they're saying is, the point of trade, from a country's perspective, is to get imports. Exports are what you give up to obtain them (comparative
by neom 25d ago
I'd guess that they're saying is, the point of trade, from a country's perspective, is to get imports. Exports are what you give up to obtain them (comparative advantage). So, when the US puts tariffs on Canadian goods, the main people who eat that cost are American consumers and firms buying those goods...basically, it's a tax Americans pay to Americans. Canada loses some export markets, however, the US isn't "extracting" anything...both sides just get less of a mutually beneficial thing.... So, In that faming, "one side gets free trade, the other gets protectionism" is in theory, a situation where the protectionist country is mostly shooting itself in the foot, not beating its partner. By the same theory, retaliating by taxing your own citizens purchases of American goods doesn't undo the damage... it adds to it. Also fwiw, a trade deal isn't a swap of comparative advantages, it's a bundling where each side concedes in sectors it can politically afford to lose in, inorder to win in sectors it cares more about. For example Canada protects dairy and gives ground on autos.
- bawolff 24d ago> I'd guess that they're saying is, the point of trade, from a country's perspective, is to get imports. I'm not sure why you would think that. It is not what I said and not what i believe.
- neom 24d agoI'm saying: that is what the person you responded to, savanaly, is using as the basis of their reply. I'm not saying that is what you said or believe.