A Primer: Why Economists Favor Free-Trade Agreement

Economic Analysis of “A Primer: Why Economists Favor Free-Trade Agreement”

       With the development of globalization, various countries and areas on this globe tend to communicate and exchange with each other more, which results in the rapid advancement of the economy. Trade is one of the essential parts of the economy and it can never be separated from the progress in the economy. One of the treaties which promote the advancement of trade as well as the economy is the North American Free Trade Agreement (NAFTA). NAFTA was signed by America, Mexico, and Canada in 1992, and it came into effect officially in the year of 1994 (Sylvia). Honestly speaking, this agreement does really make a difference for it promotes the trade communications among the North America.  As a matter of fact, there are many articles which are for or against the agreement, and “A Primer: Why Economists Favor Free-Trade Agreement” is one of them. “A Primer: Why Economists Favor Free-Trade Agreement” mainly tells the readers the reasons why so many economists support NAFTA, and its objective is well explained from the point of view of microeconomics.

       “A Primer: Why Economists Favor Free-Trade Agreement” not only illustrates the fact that a number of economists sign to encourage the execution of the North America Free Trade Agreement, but also explains the reasons why these economists are for this agreement. On the one hand, the agreement is designed to promote the import and export among the countries in the North America. There is no doubt that the trade pressure can be relieved considerably if the business barriers among different countries can be broken down (Sylvia). The agreement that has definite items to deal with the tariff and commerce barriers will surely solve the problems which hinder the business development. On the other hand, the agreement is supposed to create more jobs in the market. The free trade agreement will promote the exchanges of both labor and investment in the North America, which will create more jobs in the market. In addition, this agreement will surely do good to the further development of Mexico. In that case, the signing and successful conduct of this agreement will surely set a good example for the European countries. To sum up, this article aims at collecting more support for the NAFTA.

       From the point of view of microeconomics, the objective of “A Primer: Why Economists Favor Free-Trade Agreement” is supported by the benefits the agreement bring to consumer, investor, worker, manufacturer, the market and so on.  Microeconomics is a branch of economics, and it mainly studies the economic actions of the micro and minor commercial units including customer, investor, employee and so on. For the consumers, the agreement is beneficial, because the tariff is reduced or even eliminated, which increases the possibility for them to buy the imported products; For the investor, they are given more chances to invest in more potential project due to the reduction of the limitation of investment; For the worker, they can have more opportunities and choices for relatively more jobs are created and provided; for the manufacturer, they can not only establish more factories without too many limitations of areas but also cut cost of labor by employing more cheap employees; for the market, the market economy will receive promotion due to the driven by the free trade. Above all, various micro and minor economic units will receive potential development if the agreement can be supported and come into effect effectively.

       Personally speaking, the article’s objective should be supported in that it is a unanimous decision. For one thing, it can promote the regional economic integration. Union is, in fact, high strength. To be specific, the power of one individual is limited, but the power of a group of individual is out of imagination. In other words, the agreement will unite the three countries together and form the integrated regional economy, which will bring the three countries remarkable advancement. Besides, the regional economic integration will improve the economic connection of different countries and areas in the world. For another, the free trade agreement will undoubtedly drive the economic development of the developing countries. Mexico may be the country which will surely get a lot of opportunities to better develop its trade and economy. There is no doubt that the tariff items in the agreement will promote both the export and import in Mexico. Consequently, the deal is helpful for the future progress of Mexico’s improvement in the economy. Furthermore, this agreement sets a good example for the European as well as other developed countries and encourages them to engage in more cooperation with some developing countries. As a result, the countries and areas in the world can grow at the same pace. Therefore, I agree with the objective of the article.

       Based on the above illustrations, it is quite apparent that “A Primer: Why Economists Favor Free-Trade Agreement” is an article which aims at collecting more support for the agreement. Moreover, the article uses some reasons to explain the actions of the economists supporting the NAFTA. To be concrete, the treaty will promote the export and import in the North America, and at the same time increase the job opportunities. As far as I am concerned, the agreement should get the broad support in that it promotes the regional economic integration. In that case, the regional economy will step to a new level of development, which will also improve the global financial connection. In addition, this agreement will make progress the economy of Mexico. Meanwhile, the cooperation among the three countries sets a good example for the other countries. As a result, I agree with the objective of this article.