00:01
All right, so today we're going to be talking about international trade and the effect it has on jobs, right? so let's break it down.
00:08
So international trade we know is the exchange of goods and services across international border, right? and the main concept behind international trade is protectionism, right? so let me write this down.
00:23
Protectionism.
00:24
You may have read it in your textbook, but it basically means that the government, protect certain industries from foreign competitors or outside competition that may harm companies within their home country, right? they add protectionism through barriers, right? tariff barriers, non -tariff barriers, you know, quotas, and a bunch of other restrictions to international trade, right? and we know that the protected industry from the government will save more jobs than the unprotected, right, due to all the funding they get and the help they get from the government to compete with foreign multinational companies.
01:14
Right.
01:14
So there are two reasons why this happens.
01:16
One, the first reason is that consumers will pay higher price to the protected industry.
01:27
Consumers pay higher price.
01:36
So when consumers pay higher prices to the unprotected, sorry, sorry, when consumers pay higher prices to the protected industry, they will have less money to spend on other industries.
01:47
Right.
01:48
So the dollar can only be stretched out so much, right? if to spend more of it in one area, then they'll have less to spend in the other area.
01:56
And therefore, the other area, which is the unprotected industry, here, right? they will get less of the money and therefore have to lay off, lay off their employees to maintain a steady profit margin.
02:13
Right.
02:14
So protectionism will help this industry, the protected one, and in turn lose jobs in the unprotected...