Major drawbacks or disadvantages of trade protectionism can be expressed as follows:
1. High Price For Low Quality
Because of trade protectionism, domestic producers can raise the price of their products and services without maintaining the quality. Due to the lack of competition, produces focus only on profit rather than quality.
2. Limited Choice To The Consumers
Barrier in trade restricts foreign products which limits the range of goods and services in the market. So, consumers have to be satisfied with with limited number products and services.
In the absence of free competition, domestic industries may become idle. They may not try to improve quality, technology and management as per the requirement and consumers' choice.
Also Read:
Also Read:
4. Situation Of Monopoly
There will be a high chance of monopoly in the market because of protectionism.
5. Inefficient Resource Allocation
Trade protectionism discourages specialization and innovation. It results in inefficient allocation of resources.
