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LIBERALIZATION OF CROSS-BORDER
TRADE AND RESOURCE MOVEMENTS
To protect its own industries, every country restricts the movement across its
borders of not only goods and services but also the resources—workers, capital,
tools, and so on—needed to produce them. Such restrictions, of course, set
limits on international business activities and, because regulations can change
at any time, contribute to a climate of uncertainty. Over time, however, most
governments have reduced such restrictions, primarily for three reasons:
I. Their citizens want a greater variety of goods and services at lower prices.
II. Competition spurs domestic producers to become more efficient.
III. They hope to induce other countries to lower their barriers in turn.
EXPANSION OF CROSS-
NATIONAL COOPERATION
Governments have come to realize that their own interests can be
addressed through international cooperation by means of treaties,
agreements, and consultation. The willingness to pursue such policies is
due largely to these three needs: