Theme 4.1.4 protectionism

Protectionism

When a government protects domestic businesses and jobs from forge in competition

Trariff

A tax that has to be paid when certain prodcuts are imported into a country

Import quotas

Trade restrictions set by the government that put limits on the volume of particular products that can be imported into a country in a certain time period

Benefits of tariffs 

Protects infant industries so they can build up and face less competition

Increase government tax revenue 

Reduces dumping by forgiven businesses as they cant sell below market price 

Disadvantages of tariffs

Increase cost of imported raw materials, which may affect businesses that use these goods for production leading to high prices for consumers

Reduces competition for domestic firms as they may become more ineffective and produce poor quality products for their customers 

Reduces consumer choice as imports are now more expensive and some customers will be unable to afford them