Somehow, free trade on an international level is the same with the trade between towns, states, and neighbors. The difference lies in the part that it allows business in each country to leverage on producing and selling goods. Then, the resources could be at best, while maintaining imported goods that are unavailable or scarce in the country. The goal of this trade is to combine local production and foreign trade to get faster growth while meeting the consumer standard. An economist David Ricardo wrote a book entitled “On the Principles of Political Economy and Taxation.”
This book popularized the economic principle in free trade in 1871. Ricardo believed that free trade expands the diversity and lowers the prices of goods in a nation. It could help the country to understand domestic resources, knowledge, as well as skills. Somehow, it is different from public opinion on free trade. Economists and the general public have seen differently. Based on research done by economists at American universities, they support free-trade policies more than public opinion. Milton Friedman, an economist for instance argued that the economics profession has almost been unanimous on the free trade subject.
The policies are less popular compared to the general public. The driving issue relates to the unfair competition from countries. Countries with lower labor costs sometimes price-cut as well as good-paying jobs loss in order to manufacture overseas. In practice, there are calls on the public to buy domestic products depending on the political winds. In financial markets, free trade is a chance to involve another part of the domestic producers. In addition, free trade is actually an integral part of the financial system and investing world.
