Unit 4 → Subtopic 4.4
How Would You Respond to Protectionism?
In an era of globalization, free trade has helped economies grow, businesses expand, and consumers access a wider variety of goods at lower prices. However, not all countries embrace free trade fully—some implement protectionist policies such as tariffs, import quotas, and subsidies to shield domestic industries from foreign competition. While protectionism can safeguard jobs and national industries, it can also lead to trade wars, higher consumer prices, and economic inefficiencies. This project challenges students to analyze how countries and businesses respond to protectionist measures and whether these policies are beneficial or harmful in the long run.
Students will begin by researching what protectionism is and why governments implement it. They should examine different types of protectionist policies, such as tariffs on imported goods, subsidies for local industries, and restrictions on foreign investments. They should also explore why some countries—such as the United States, China, and India—use protectionist policies to boost national economies, while others advocate for free trade.
A key focus of this project is investigating the impact of protectionism on businesses and consumers. Students should examine whether trade barriers help domestic industries grow or if they cause retaliation from other countries, leading to economic losses. Case studies on U.S.-China trade tensions, Brexit-related trade restrictions, and protectionist policies in developing economies will provide insight into the consequences of protectionism.
Another major component is analyzing how governments, multinational corporations, and trade organizations respond to protectionist measures. Some countries challenge tariffs and quotas through the World Trade Organization (WTO), while businesses may adapt by shifting supply chains, lobbying for trade agreements, or relocating production to different countries.
The final report should assess whether protectionist policies help or hurt economies in the long term and explore how businesses and governments can respond to trade restrictions effectively. The goal of this project is to help students understand the complexities of international trade, the risks of economic nationalism, and the strategies used to manage trade conflicts.
Recommended Procedure:
Research the Concept of Protectionism in Global Trade – Study how tariffs, quotas, trade barriers, and government subsidies are used to protect domestic industries from foreign competition and their economic consequences.
Analyze Case Studies of Countries Implementing Protectionist Policies – Investigate examples such as U.S. tariffs on China, Brexit-related trade restrictions, and historical cases like the Smoot-Hawley Tariff Act.
Examine the Economic Impact of Protectionism on Different Sectors – Assess how industries such as manufacturing, agriculture, and technology are affected by trade restrictions and whether protectionist policies create long-term benefits or harm economic growth.
Develop a Response Plan as a Business or Government Official – Take on the role of a policymaker or corporate strategist and propose measures to navigate or counteract the effects of protectionism, including trade negotiations, business relocation, and lobbying efforts.
Write an Analysis on the Effectiveness of Protectionism – Discuss whether protectionism strengthens domestic economies or leads to retaliatory trade wars, and suggest whether free trade or managed trade is a better long-term strategy.
Suggested Sources:
Understanding Protectionism and Its Effects on Trade:
Investopedia: What Is Protectionism? – https://www.investopedia.com
Khan Academy: Tariffs and Their Impact on Trade – https://www.khanacademy.org
2. Case Studies on Protectionist Policies:
The Balance: How Tariffs and Trade Wars Impact Economies – https://www.thebalancemoney.com
Harvard Business Review: The Rise of Protectionism and Its Consequences – https://hbr.org
3. Economic and Political Considerations in Trade Policy:
World Bank: The Pros and Cons of Protectionism in Modern Economies – https://www.worldbank.org
OECD: The Global Effects of Trade Barriers – https://www.oecd.org
4. Future of Protectionism and International Trade:
IMF: The Future of Free Trade vs. Protectionist Policies – https://www.imf.org
United Nations: Global Trade Agreements and the Fight Against Protectionism – https://www.un.org
Grading Rubric:
Total Points: __ /20
