Introduction What reasons are there for governments not to interfere with trade? There are three arguments in favor of free trade Free trade and efficiency Economies of scale in production Political argument Copyright C 2003 Pearson Education, Inc Slide 9-4Copyright © 2003 Pearson Education, Inc. Slide 9-4 Introduction ▪ What reasons are there for governments not to interfere with trade? • There are three arguments in favor of free trade: – Free trade and efficiency – Economies of scale in production – Political argument