Impact of Commercial Openness on GDP and economic Growth (Term Paper Sample)

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Impact of Commercial Openness on GDP and economic Growth
Since the rise of globalization, the world’s economies have increasingly become dependent on each other. However, the debate between the choosing to impose protectionism policies or embracing free trade between countries doesn’t seem to be conclusive. Since the establishment of the General Agreement on Tariffs and Trade (GATT), several trading blocks have been formed to enhance free trade agreements and common favorable terms among their members. Economic openness is the removal of all direct and indirect restrictions that could restrict foreign trade in a country including tariff and non-tariff restrictions. Different countries perceive the idea of free trade differently depending on its impact on their economy. For this case, some countries have put various non-tariff measures to restrict open trade across their borders hence affecting their internal commercial intensity. Trade openness is, in most cases, linked to a country’s growth rate, poverty level, social stratification, among other factors. This paper will review available literature evaluating the impacts of commercial openness to different countries and regions in the world.