Trade liberalization
A) reduces poverty wherever it increases real GDP per capita
B) increases inequality in theory but not in practice
C) reduces inequality and poverty if the poor work in expanding sectors
D) has no effect on the distribution of income within a country
E) redistributes income from the rich to the poor even as overall GDP declines

Question

Quizplus · Accepted Answer

Trade liberalization can lead to a reduction in inequality and poverty if the poor work in the expanding sectors. However, it is important to note that this is not a guarantee and there can be winners and losers in any trade liberalization policy. Additionally, trade liberalization may have other impacts on the economy, such as increasing competitiveness and overall economic growth.

Trade Liberalization