A multilateral approach to free trade has more potential to increase the gains from trade than a unilateral approach because the multilateral approach can reduce trade restrictions abroad as well as at home.

Question

Quizplus · Accepted Answer

A multilateral approach involves multiple countries negotiating and agreeing to reduce trade barriers and increase free trade. This not only reduces trade restrictions in one's own country but also in other participating countries, leading to increased gains from trade for all parties involved. In contrast, a unilateral approach only involves one country reducing its own trade barriers, which may not necessarily lead to reciprocal reductions in trade barriers abroad.

A Multilateral Approach to Free Trade Has More Potential to Increase