Multilateral Trade Liberalization Boosts Domestic Economic Prosperity, Preventing Damaging Trade Wars
In the study, it was discovered that when multiple countries open up to trading with each other, they tend to make their own trade policies more open too. The researchers looked at data from 166 countries between 1995 and 2014 to learn this. They found that the more a country progresses, the more its trade policies get influenced by multilateral trade agreements. And if a country turns inward with protectionist policies, it could cause trading partners to do the same, leading to trade conflicts that hurt economies globally. So, when countries free up trade with each other, it usually leads to looser domestic trade rules as well.