ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -protectionism, policy of protecting domestic industries against foreign competition by means of tariffs, subsidies, import quotas, or other restrictions or handicaps placed on the imports of foreign competitors.

Detailed explanation-2: -Protectionism is the practice of following protectionist trade policies. A protectionist trade policy allows the government of a country to promote domestic producers, and thereby boost the domestic production of goods and services by imposing tariffs or otherwise limiting foreign goods and services in the marketplace.

Detailed explanation-3: -Protectionism takes three main forms: tariffs, import quotas, and nontariff barriers. Tariffs are taxes that a government imposes on imported goods and services. This makes imports more expensive for consumers, discouraging purchases of imports in favor or domestic substitutes.

Detailed explanation-4: -The arguments for protectionism include national defense, trade deficit, employment, infant industries, and fair trade.

Detailed explanation-5: -Definition of free trade: The unobstructed trade of goods and services between two countries with no restrictions on imports and exports. Definition of protectionism: where a country erects barriers to trade in order to protect the domestic economy from the disadvantages of international trade.