Protectionism

Protectionism is an economic policy that limits foreign competition to benefit domestic producers, typically through tariffs, quotas, or import restrictions.

Tariff: A tax imposed on imported or exported goods, usually collected at the border. Tariffs raise the domestic price of imports and can give local producers a price advantage.
Deadweight loss: A loss of total economic surplus caused by a market distortion that prevents mutually beneficial exchanges. Higher prices and reduced trade can create losses that are not captured by protected producers.
Free trade: International exchange of goods and services with few government-imposed barriers. It is the principal policy alternative to restricting imports.
Corn Laws: British laws that restricted grain imports from 1815 until their repeal in 1846. Their repeal became a defining nineteenth-century contest over food prices and free trade.
Import quota: A government limit on the quantity or value of a good that may be imported. Quotas restrict foreign supply directly rather than taxing it.
Consumer surplus: The difference between what consumers are willing to pay and what they actually pay. Protection commonly reduces consumer surplus by raising prices or limiting choices.
Comparative advantage: The ability to produce a good at a lower opportunity cost than another producer. Its logic explains how specialization and trade can benefit countries despite unequal productivity.
Smoot–Hawley Tariff Act: A 1930 United States law that sharply raised tariffs on many imported goods. It is a prominent case of tariff escalation during the Great Depression.
Non-tariff barrier: A trade restriction other than a tariff, including licensing rules, standards, and administrative requirements. Many protective restrictions operate through rules rather than import taxes.
Retaliatory tariff: A tariff imposed in response to another country's trade restriction or tariff. Trading partners may answer protection with barriers against the original country's exports.

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