Policymakers are faced with several problems when trying to administer import controls. First, most of the time such controls exact a huge price from domestic consumers. Import controls may mean that the most efficient sources of supply are not available. The result is either second- best product or higher costs for restricted supplies, which in turn cause customer service standards to drop and consumers to pay significantly higher prices. Even though these costs may be widely distributed among many consumers and are les obvious, the social cost of the controls may be damaging to the economy and subject to severe attack from individuals. However, these attacks are countries by pressure from protected groups that benefit from import restriction.
For example, while citizens of the European Union may be forced by import controls to pay an elevated price for all the agricultural products they consume agriculture producers in the region benefit from higher incomes. Achieving a proper trade off is often difficult, if not impossible, for the policymaker. A second major problem resulting from import controls is the downstream change in the composition of the import that may result. For the importation of copper ore is restricted, through either voluntary restraints or quotas, producing countries may opt to shift theirs production systems and produce copper wire instead, which they can export.
As result, initially narrowly defined protectionist measures may snowball in order to protect one downstream industry after another. Another major problem that the policy maker is that of efficiency. Import controls designed to provide breathing room to a domestic industry so it can either grow or recapture its competitive position often do not work. Rather than improve the productivity of an industry, such con troll may provide it with a level of safety and a cushion of increased income, subsequently causing it to lag behind in technological advancement.
One must also be aware of the corporate response to improve restrictions. Corporations faced with such restrictions can encourage their governments to erect similar barriers to protect them at home. The result is a gradually escalating set of trades' obstacles. In addition, corporations can make strategic use of such barriers by incorporating them in to their plans and exploiting them in order to gain market share. For example, some multinational corporations have pressed governments to initiate antidumping actions against their competitors when faced with low priced import. In such instances, corporations may substituted adroit handling of government relation for innovation and competitiveness.
Finally, corporations also can circumvent import restrictions by shifting their activities. For example, instead of conducting trade, corporation can shift to foreign direct investment. The result may be a drop in trade inflow, yet the domestic industry may still be under strong pleasure from the foreign firms. The investment of Japanese car producers In the United States serve as an example. However, due to the job creation effects of such investment, such shifts may have been the driving desire on the part of the policymakers who implemented the import controls. 4.
While boycotting may seem like a simple and productive way of expressing our concerns about important issues, in the end the outcomes are dubious. What would you suggest? I thing If we are the marketing officer in American company. The best way to change their mine of people in France and Germany to solve problem that they thing American product is not good. Such as change promotion to promote product or just lunch campaign to promote brand and donate some money for help people that effect from war. May be you can promote slogan like (made in German by German for German people).
Another way is the best way to help American product do not lose market chair in the France, German market is sell some stock to the government for use government to help company promote product or donate some goods to help government when they need help.