Posted by Jason on .
The establishemnt of regional trading blocs may lead to a decline in global trade follwoing these reason. Explain why.
1. Sufficent trade diversion occurs
2. Government increase tariffs to nonmember nations to offset lost tariff revenus from coutntries participating in regional blocs.
3. Countries protect industries in which they do not have a comparative advantage.
Do some research, then take a shot. What do you think?