In the recent past many countries have adopted trade liberalization as the way forward to development. Highlight any four adverse effects that such nations may experience due to liberalization

  • Encourages single sided development since industries with comparative advantage  develops to the neglect of others
  • Substandard and harmful products may be produced and traded leading to dilution of social welfare
  • Dumping is encouraged which discourages development of local industries
  • May lead to exploitation and colonisation
  • Promotes unproductive competition which leads to closure of infant industries
  • Presupposes the existence of leissez faire and working of price mechanism  under perfect market which are unrealistic

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