Chapter 6: Trade Regulations and Industrial Policies Flashcards Preview

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Flashcards in Chapter 6: Trade Regulations and Industrial Policies Deck (21)
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Countervailing duty

A levy imposed by importing countries to counteract foreign export subsidies; the size of the duty is limited to the amount of the export subsidy.


Doha Round

The most recent round of multilateral trade negotiations under the World Trade Organization.


Economic sanctions

Government mandated limitations placed on customary trade or financial relations among nations.


Escape clause

Allows the president to temporarily terminate or make modifications in trade concessions granted foreign nations and to temporarily levy restrictions on surging imports.


Export-Import Bank

An independent agency of the U.S. government established to encourage the exports of U.S. businesses.


Fast track authority

Devised in 1974, this provision commits the U.S. Congress to consider trade agreements without amendment; in return, the president must adhere to a specified timetable and several other procedure


General Agreement on Tariffs and Trade (GATT)

Signed in 1947, GATT was crafted as an agreement among contracting parties, the member nations, to decrease trade barriers and place all nations on an equal footing in trading relations; GATT was never intended to become an organization; instead it was a set of bilateral agreements among countries around the world to reduce trade barriers.


Intellectual property rights (IPRs)

The exclusive rights to use an invention, idea, product, or process for a given time awarded to the inventor (or author) through registration with the government of that invention, idea, product, or process.


Kennedy Round

Round of trade negotiations named after U.S. President John F. Kennedy between GATT members during the period 1964–1967.


Most favored nation (MFN) clause

An agreement between two nations to apply tariffs to each other at rates as low as those applied to any other nation.


Normal trade relations

The U.S. government's replacement for the term most favored nation.


Reciprocal Trade Agreements Act

An act passed in Congress in 1934 that set the stage for a wave of trade liberalization through negotiating authority and generalized reductions.



Relief provided by the escape clause to U.S. firms and workers who are substantially injured from surges in imports that are fairly traded.


Section 301

Section of the Trade Act of 1974 that gives the U.S. trade representative (USTR) authority, subject to the approval of the president, and means to respond to unfair trading practices by foreign nations.


Smoot–Hawley Act

Act passed in 1930 under which U.S. average tariffs were raised to 53 percent on protected imports.


Strategic trade policy

The policy that government can assist domestic companies in capturing economic profits from foreign competitors.


Tokyo Round

Round of talks between GATT members from 1973–1979, in which signatory nations agreed to tariff cuts that took the across-the-board form initiated in the Kennedy Round.


Trade adjustment assistance

Government assistance granted to domestic workers displaced by increased imports.


Trade remedy laws

Laws designed to produce a fair trading environment for all parties engaging in international business; these laws include the escape clause, countervailing duties, antidumping duties, and unfair trading practices.


Uruguay Round

Round of talks between GATT members from 1986–1993 in which across-the-board tariff cuts for industrial countries averaged 40 percent.


World Trade Organization (WTO)

Organization that embodies the main provisions of GATT, but its role was expanded to include a mechanism intended to improve GATT's process for resolving trade disputes among member nations.