Question

Discuss the positive and negative effects of the North American Free Trade Agreement on the United States. Support your conclusions with examples and evidence?

Answer 1

Following are the Positive and negative effects of the North American Free Trade Agreement:

Positives:

• It has increased the level of output. it is projected that if the agreement is implemented in its full form, it would lead to a rise in growth which would be as high as 0.5 %.
• Decrease in inflation: it has led to a fall in the price of goods and services as new products enter the market.
• The rise in FDI is the result of such agreements.
• it increases the revenue of the government and the government is able to make inflated expenditure on social programs.

Negatives:

• it increases the competition among the workers so it leads to depressed wages and conflict arises among the workers.
• Unemployment is likely to rises due to such agreements.
• Security threat would rise.