ADMINISTRATIVE BARRIERS AS PROTECTIONISM
How it reduces
imports/promotes exports
Real-world Example
Is this barrier easy or hard to do?
Why? HINT: think about countries
PRODUCT
STANDARDS
A country may create product
standards, laws, or regulations
to protect the quality of a
product and the health and
safety of consumers in the
domestic market. Product
standards can therefore
protect domestic firms as it
reduces imports that may be
cheaper than domestic goods.
Many countries regulate the
automobile manufacturing
industry by setting safety
standards for cars, such as
airbags, seat belts, and
bumpers.
In Switzerland, all cars must
have a stop light in the back
window
It’s relatively easy to set standards
on imports because safety standard
is a good excuse to not anger other
countries, however, the prices may
go up domestically.
VOLUNTARY EXPORT
RESTRAINTS (VER)
When the exporting country
voluntarily agrees to reduce
the volume of exports. Make
an arrangement to protect its
industry. Such as negotiating a
limit to exports.
US government approached
Japan to try to come to an
arrangement to protect its
industry. They managed to
negotiate a limit to Japanese
exports of cars to the USA
It’s quite hard to negotiate
voluntary export restraints because
if another country reduces export
then they’re missing out on income
thus they would be reluctant to do
it. Thus, only countries with power
could do.
BUY NATIONAL
CAMPAIGNS
Encouraging domestic
producers to buy domestic
goods by promoting the
national campaign; playing on
the people's sense of national
pride.
OTOP (one tambon one
product)
Kumamon - Kumamoto
It’s relatively easy to set up national
campaigns, however, it’s hard to
attract consumers and create a
uniqueness.