Question

In terms of economics, is the U.S. economy overall better off with free trade or with protections that shelter local workers and businesses?

Answer 1

Free trade helps to increase the social welfare of the country. The consumers are able to get the goods and services at the lower price and similarly, producers tend to get the cheaper inputs.

But free trade might lead to a fall in domestic production if the cheaper import is available. it will cost the domestic employments. The right restrictions on import will increase the demand for domestic goods. it would increase employment and balance of payments problem is addressed.

But these are short-run benefits of trade restrictions. over the long run, the cost of production would rise and the economy will suffer the fall in the growth rate.

Thus, trade restriction or protectionism would not be beneficial in the long run.