Political Science

Most people although will suggest that we are living in a globalised world but per me we are living in what can be deemed as a semi-globalised world and certainly not a truly globalised one. A truly globalised world can only be a one in which there is absolutely zero trade barrier in between any two nations of the world. This could be termed as a complete unification at the global level and smaller free trade agreements like NAFTA, SAFTA, ASEAN, GATT are just a few of stepping stones that could eventually lead us to our final milestone of a completely free economy.

There have always been concerns and doubts about the effectiveness and significance of free economy and a divide of people for and against it. Economists from the for side suggest that it is prudent not to create differences between the residents of various parts of the world by protectionist policies, thus treating the entire world as a common global hub which in turn is beneficial to every member of this common hub.

Adam Smith (The Wealth of Nations, 1776) suggested that if the quantity of any commodity brought to the market is short of the actual demand, and all the potential consumers for the commodity cannot be supplied with the commodity, then there will be a competition emerging in between various consumers and thereby the market price for the commodity will rise. He has argued that the interest of consumer be given the priority over the interest of producer and if the interest of producer has to be attended, that interest should be helping to work for the interest of consumer in some way or the other.  He proposed the concept of invisible hand which says that there should be no interference from the government or any other authority in the smooth functioning of the market and the market would correct itself automatically with the help of a pure demand and supply logic.  Any artificial curbs or restrictions on the market hamper the smooth functioning thereby a delay in the realization of correct prices of the goods or commodities. He analyzed that different individual although may appear working for their interest, but, at the end of the day are contributing for the welfare of the society.

One of the major reasons that countries seek to curb globalization is to get a favourable balance of trade and reducing the fiscal deficit.

Fiscal Deficit Imports - Exports
Countries try to reduce their fiscal deficit as far as possible.  In their attempt to reduce import they try to minimize the imports into their country by introducing entry barriers on goods and commodities which are getting imported from other countries in the form of import duties.

What so ever may be the case, the economists across the globe agree that free trade is the only manner in which we could develop a world which has every part of it growing because countries will develop niche skills in a particular sector thus reducing the cost and improving the quality and the whole world will prosper.  So lets try and make this world barrier free