Government Intervention on Trade Flow Management Essay

Government Intervention on Trade Flow
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Government Intervention on Trade Flow
The government intervention on the flow of trade within the country is significant. In particular, the state does it with the best interest of its citizens at heart. That is the reason why it intervenes to protect local industries and other stakeholders from suppression by international corporations (Daniels, Radebaugh, & Sullivan, 2018). Besides, no country can grow without creating an equal platform where citizens can establish businesses and compete among themselves equally. The other primary reason why the government intervenes in trading activities is to reduce the rate of unemployment, which hurts the nation’s economic growth. The paper contrasts and compares how the American and Chinese governments intervene in the flow of trade in their respective countries.
In the last few decades, the economy of China has been growing at a faster pace. Some of the successes of the Chinese economy have been caused by government intervention in trading activities. First, the Chinese government implemented policies to safeguard domestic industries. Second, it has created a competitive environment where new firms can start and grow. For example, in the past few decades, China has supported the establishment of many technology companies. Due to their expertise, global corporations, such as Apple Inc., outsource its assembling services to the country. Third, the government prioritize reducing the rate of unemployment by ensuring that all the deals it makes create jobs for Chinese citizens regardless of whether it involves local or international trading activities. Fourth, the government of China is seeking to join multiple regional organizations, such as the World Trade Organization (WTO) so that it can enjoy the benefits offered, which will further extend their global reach (Morrison, 2019). Consequently, its intervention on trade flow has significantly fostered the country’s economic growth.
On the contrary, the USA government has been known for many years to promote the protectionism of domestic industries by altering the business operating environment. Christina Davis, Kristina Johnson, and Andreas Fuchs (2019) claim that the state influence on organizations enables the flow of trade to be responsive to international markets (Davis, Fuchs, & Johnson, 2019). That ...