Our approach does not allow us to identify the exact sources of these quality improvements, but we discuss possible mechanisms. One explanation that is consistent with growing literature using data at the enterprise level is that foreign exporters are improving the quality to serve the EU market after the implementation of trade agreements (2008, Iacovone and Javorcik 2012). With the measures relating to the prices, diversity and quality of EU12 imports, we will see how they have changed with the implementation of trade agreements. We compare the evolution of the three variables for the group of countries that have signed trade agreements with the EU with a monitoring group of countries that have not done so. Trade protectionism is rarely the answer. High tariffs only protect domestic industry in the short term. In the long term, global companies will hire the cheapest workforce, anywhere in the world, to make higher profits. „The WTO is the operating system of the global economy that ensures that goods and services can be traded daily in a stable, rules-based environment. Even if no organization is perfect, anyone who thinks they can rely on a system of bilateral trade agreements rather than the WTO risks losing a lot of wealth in international trade,“ says Christian Bluth, a trade expert at the Bertelsmann Foundation. But the trade agreements we sign and discuss – like the proposed Trans-Pacific Partnership – have almost nothing to do with free trade. These agreements are really just selective protectionism. Some participants will be exposed to the full burden of global competition, such as U.S.
factory workers. But some will make the rules that protect them from competition, like some pharmaceutical companies. They use these agreements to force governments in developing countries to use account collectors to enforce their patents, driving up drug costs. Instead, give and take globalization and trade agreements – and there are many reasons in the United States to think that they have taken much more – and many more people – than we generally admit in our limited debates on trade. The main criticism of free trade agreements is that they are responsible for outsourcing employment. There are seven drawbacks: environmental protection measures can prevent the destruction of natural resources and crops. Labour laws prevent poor working conditions. The World Trade Organization imposes rules on free trade agreements. The pros and cons of free trade agreements affect jobs, business growth and living standards: instead, we seem determined to move forward with agreements that give to the rich and target them. And then, be surprised that this happens.