... production to be very much higher than if there were no international trade. However not everyone benefits from free trade. Arguments used to justify tariffs: The infant industry argument - Industries just starting up may face much higher costs than foreign competitors. There may be large economies of scale in the industry. A new low volume producer will find it impossible to compete on price against an established foreign high volume producer. Once sufficiently large, tariff barriers can be removed and the industry exposed to the full heat of foreign competition. Cheaper labour - Countries which have plentiful sources of cheap labour are often accused of 'unfair competition'. High labour cost countries find it difficult if not impossible to compete against products from these countries. Job protection - Protectionism can create or at least preserve jobs. Arguments used against tariffs: The infant industry argument - Infant industries in general have not grown successfully ...

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