MGMT 450 Final - Chapter 9

Total Flash Cards » 24
 
1. 

Free Trade

 

Implies that the national government exerts minimal influence on the exporting and importing decisions of private firms and individuals

 
2. 

Fair Trade/Managed Trade

 

Suggests that the national government should actively intervene to ensure that domestic firms' exports receive an equitable share of foreign markets and that imports are controlled to minimize losses of domestic jobs and market share in specific industries

 
3. 

National Defense Argument

 

A country must be self-sufficient in critical raw materials, machinery, and technology or else be vulnerable to foreign threats

 
4. 

Infant Industry Argument

 

Argument in favor of governmental intervention in trade: a nation should protect fledgling industries for which the national will ultimately possess a comparative advantage

 
5. 

Strategic Trade Theory

 

Suggests that a national government can make its country better off if it adopts trade policies that improve the competitiveness of its domestic firms in certain oligopolistic industries

 
6. 

Export Promotion Strategy

 

A country encourages firms to compete in foreign markets by harnessing some advantage the country possesses, such as low labor costs. Also encourages the diversification of exports.

 
7. 

Import Substitution Strategy

 

Encourages the growth of domestic manufacturing industries by erecting high barriers to imported goods

 
8. 

Industrial Policy

 

The national government identifies key domestic industries critical to the country's future economic growth and then formulates programs that promote their competitiveness

 
9. 

Public Choice Analysis

 

A branch of economics that analyzes public decision making. The special interest will often dominate the general interest on any given issue for a simple reason: special-interest groups are willing to work harder for the passage of laws favorable to their interests than the general public is willing to work for the defeat of laws unfavorable to its interests,

 
10. 

Tariffs

 

A tax placed on a good that is traded internationally

 
11. 

Non-tariff Barriers

 

Any government regulation, policy, or procedure other than a tariff that has the effect of impeding international trade

 
12. 

Export tariff

 

Levied as the goods leave the country

 
13. 

Transit tariff

 

Levied as the goods pass through one country bound for another

 
14. 

Import tariff

 

Collected on imported goods

 
15. 

Ad valorem tariff

 

Assessed as a percentage of market value of the imported goods

 
16. 

Specific tariff

 

Assessed as a specific dollar amount per unit of weight or other standard

 
17. 

Compound tariff

 

Has both an ad valorem and specific tariff component

 
18. 

Quota

 

A numerical limit on the quantity of a good that may be imported into a country during some time period, such as a year

 
19. 

Tariff Rate Quota (TRQ)

 

Imposes a low tariff rate on a limited amount of imports of a specific good; above that threshold, imposes a prohibitively high tariff rate on the good

 
20. 

Voluntary Export Restraint (VER)

 

A promise by a country to limit its exports of a good to another country to a pre-specified amount or percentage of the affected market

 
21. 

Embargo

 

An absolute ban on the exporting (and/or importing) of goods to a particular destination

 
22. 

Foreign Trade Zone (FTZ)

 

A geographic area where imported or exported goods receive preferential tariff treatment

 
23. 

Countervailing duties

 

Ad valorem tariff on an imported good to counter the impact of foreign subsidies

 
24. 

Anti-dumping regulations

 

Two types of dumping: (1) international price discrimination, (2) predatory pricing