INTERNATIONAL TRADE Essay

1. Who benefits from the political science policies to (a) push production of fermentation alcohol and (b) place tax barriers on seconds of earnings evicte? Who suffers as a result of these policies? ANS Benefiters in promoting production of ethanol-Corn producers. They get subsidies from the government and get a free means of marketing from the government. The government promotes consumption of ethanol, ethanol is produced out of lemon yellow, so indirect marketing for corn farmers that will get much demand out of policies that promote ethanol. -Ethanol sellers.-People all around the world. As to be seen in the direction of orbiculate warming, you can say that using ethanol is better. But using ethanol leads to increase food prices. So there is a negative and a positive side. -Businesses. If farmers get subsidies from the government they can lower their price. If farmers lower their price, the production to produce ethanol becomes cheaper thus making ethanol cheaper. Busin esses that use ethanol will have a cheaper price, reducing costs and increasing profits. -The Government. In a democratic corporation we argon seeing right now that a lot of people go green. When going green the government is trying to let you know that he cares about the world and he wants to make it better. It is a win win situation because there are no people in our opinion that are opposed in going green, but they are a lot of followers and possible followers that support an environmental friendly world. Benefiters in placing tariff barriers on imports of sugar cane -The Government. They get all the money out of these tariffs. Sufferers as a result of these policies-Countries that produce sugar for a living. Profit goes dramatically down when talking about a 25 to 50% import tariff. -Countries that set import tariffs for sugar. Countries that produce sugar can have put import tariffs themselves as protection against the country that has an import tariff on them. And countries t hat produce sugar can consider different possibilities when exporting their product to another country. They can acknowledge that it is not in their best interest to produce products to a land where import tariffs are so ridiculously high. They can see other possible solutions. 2.One estimate suggests that if food prices prink by one third, they will reduce living standards in rich countries by about 3 percent, but in actually poor ones by about 20 percent. According to the International Food Policy Research Institute, unless policies change, cereal prices will rise by 10 to 20 percent by 2015, and the expansion of bio-fuel production could reduce calorie intake by 2 to 8 percent by 2020 in many of the worlds poorest nations. Should rich countries do anything about this potential problem? If so,what? ANS Rich countries should not give any subsidies to the bio-fuel corn farmers.They should decrease import tariffs so that it can be cheaper for countries that produce sugar (and so t hey can make bio-fuel out of sugar) thus increasing the amount of sugar that countries can export. They should develop new ideas in how they can attack environmental changes through cost-effective ways. 3. The argument for giving subsidies to ethanol producers rests upon the assumption that ethanol results in lower CO2 emissions than gasoline and therefore benefits the environment. If we accept that global warming is a serious problem in itself, should we not be encouraging government to increase such subsidies? What are the arguments for and against doing so? On balance, what do you see is the best policy? ANS When the government started to subsidies farmers who grow crops. So they could turn them into bio fuels ( primarily corn and soy beans ). More farmers where now planting crops, because then they got subsidies from the government. Its also very good for the environment. But it also has a negative side. When more farmers where planting crops.There was an dramatic effect on th e demand for corn and soy beans. It increased very fast that in 2007 the U.S was responsible for half the global increase for the demand on crops. But when this happened the high tariffs where shutting out producers of the product sugar cane. So they could compete with the other products because the prices were so high. And thats very unfortunately because sugar cane is an more friendly environment material than crops and soy beans. I think the best policy is to reduce the high tariffs on the other products. Because the sugar cane is even more environment friendly. And isnt that what its all about, reducing the global warming effect. So I think they should drop the high tariffs and introduce the sugar cane.