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Economic nationalism is a term used to describe policies which are guided by the idea of protecting domestic consumption, labor and capital formation, even if this requires the imposition of tariffs and other restrictions on the movement of labour, goods and capital. It is in opposition to globalization in many cases, or at least it questions the benefits of unrestricted free trade. Economic nationalism may include such doctrines as protectionism and import substitution. Image File history File links Information_icon. ... A tariff is a tax on foreign goods. ... A KFC franchise in Kuwait. ... Free trade is an economic concept referring to the selling of products between countries without tariffs or other trade barriers. ... Protectionism is the economic policy of restraining trade between nations, through methods such as high tariffs on imported goods, restrictive quotas, a variety of restrictive government regulations designed to discourage imports, and anti-dumping laws in an attempt to protect domestic industries in a particular nation from foreign take-over... Import substitution industrialization (also called ISI) is a trade and economic policy based on the premise that a developing country should attempt to substitute products which it imports, mostly finished goods, with locally produced substitutes. ...

Examples of economic nationalism include Henry Clay's American System (economic system), Japan's use of MITI to "pick winners and losers", Malaysia's imposition of currency controls in the wake of the 1997 currency crisis, China's controlled exchange of the yuan, Argentina's economic policy of tariffs and devaluation in the wake of the 2001 financial crisis and the United States' use of tariffs to protect domestic steel production. The American System (also known as the National System[1]) is the economic philosophy that dominated United States national policies from the time of the American Civil War until the mid-twentieth century as the countrys policies evolved in a free market direction. ... The Ministry of International Trade and Industry (通商産業省 Tsūsho-sangyō-shō or MITI) was the single most powerful agency in the Japanese government during the 1950s and 1960s. ... The Asian financial crisis was a financial crisis that started in July 1997 in Thailand and affected currencies, stock markets, and other asset prices in several Asian countries, many considered East Asian Tigers. ... ISO 4217 Code CNY User(s) Mainland of the Peoples Republic of China Inflation 1. ... A tariff is a tax placed on imported and/or exported goods, sometimes called a customs duty. ... Devaluation is a reduction in the value of a currency with respect to other monetary units. ... 2001 (MMI) was a common year starting on Monday of the Gregorian calendar. ...

Examples of Nationalism became more visible in 2005 and 2006 after several governments intervened to prevent takeovers of domestic firms by foreign companies. Some cases include: A takeover in business refers to one company (the acquirer, or bidder) purchasing another (the target). ...

• The proposed takeover of Arcelor (France and Luxembourg) by Mittal (India).
• The failed attempt by the Italian government to prevent the takeover of Banca Antonveneta (Italy) by ABN AMRO (Netherlands).
• The government listing of Danone (France) as a 'strategic industry' to pre-empt a potential takeover bid by PepsiCo (USA).
• The blocked takeover of Autostrade, an Italian toll-road operator by the Spanish company Abertis.
• The proposed takeover of Endesa (Spain) by E.ON (Germany), and the counter-bid by Gas Natural (Spain). The proposed takeover of SUEZ (France) by Enel (Italy), and the counter-bid by Gaz de France (France).
• The congressional opposition to the takeover bid for Unocal (USA) by CNOOC (PR China), and the subsequent takeover by Chevron (USA).
• Political opposition in 2006 to sell port management businesses in six major U.S. seaports to a company DP World based in the United Arab Emirates
• At the beginning of 2007 new draft legislation restricting foreign companies' access to Russia's natural-resource wealth and select Russian industries

The reason for a policy of economic protectionism in the cases above varied from bid to bid, In the case of Mittal's bid for Arcelor, the primary concerns involved job security for the Arcelor employees based in France and Luxembourg. The cases of French SUEZ and Spanish Endesa involved the desire for respective European governments to create a 'national champion' capable of competing at both a European and global level. Both the French and US government used national security as the reason for opposing takeovers of Danone, Unocal and the bid by DP World for 6 US ports. It should be noted that in none of the examples given above was the original bid deemed to be against the interests of competition. In many cases the shareholders supported the foreign bid. For instance in France after the bid for Suez by Enel was counteracted by the French public energy and gas company Gaz De France the shareholders of Suez complained and the unions of Gaz De France were in an uproar because of the privatization of their jobs. Arcelor S.A. (Euronext: LOR) is the worlds largest steel producer in terms of turnover and the second largest in terms of steel output, with a turnover of 30. ... // Mittal Steel Company N.V. (Euronext: MT, NYSE: MT) is the worlds largest steel producer. ... Antonveneta is the 9th largest banking group in Italy in terms of customer loans and the 8th largest in terms of total assets, with 1,000 branches, 10,800 employees and €50bn in assets. ... ABN AMRO (Euronext: AAB, NYSE: ABN) is one of the largest banks in the Netherlands and has operations all over the world, its history going back to 1824. ... Groupe Danone SA is an international food products company with its central headquarters in France, specializing in dairy products, especially famous for its yoghurt. ... PepsiCo, Inc. ... Abertis Infraestructuras, SA, (IBEX-35:ABE) is a Spanish corporation. ... Endesa, S.A. (NYSE: ELE), (IBEX-35:ELE) is the largest electric utility company in Spain. ... It has been suggested that VEBA be merged into this article or section. ... Gas Natural SDG, S.A., (IBEX-35:GAS) is an energy company which operates primarily in Spain but also in such countries as Italy, Mexico, Colombia, Argentina, Puerto Rico and Morocco. ... SUEZ (Euronext: SZE, NYSE: SZE) is a leading French-based multinational corporation, with operations primarily in water, electricity and natural gas supply, and waste management. ... Enel is an Italian energy provider and the third largest energy provider in the world. ... Gaz de France is a French company which specializes in the transportatino and distribution of natural gas. ... Type Bicameralism Houses Senate House of Representatives United States Senate Majority Leader Harry Reid, D, since January 4, 2007 Speaker of the House Nancy Pelosi, D, since January 4, 2007 Members 535 plus 4 Delegates and 1 Resident Commissioner Political groups (as of November 7, 2006 elections) Democratic Party Republican... Unocal Corporation is the parent company of Union Oil Company of California (Union Oil) which was incorporated in California in 1890. ... China National Offshore Oil Corporation (CNOOC) HKEx: 0883 (中国海洋石油总公司) is the third-largest National Oil Company(NOC) in the Peoples Republic of China next to CNPC, Sinopec. ... Chevron Corporation (NYSE: CVX) is one of the worlds largest global energy companies. ... The DP World controversy began in February 2006 and rose to prominence as a national security debate in the United States. ... DP World is a company owned by the government of Dubai in the United Arab Emirates. ...

Economic patriotism

Economic patriotism is the coordinated and promoted behaviour of consumers or companies (both private and public) that consists of favoring the goods or services produced in their country or in their group of countries. Economic patriotism can be practiced either through demand stimulation (encouraging consumers to purchase the goods and services of their own country) or through supply protection, the shielding of the domestic market from foreign competition through tariffs or quotas (protectionism). A recently emerging form of economic patriotism is financial protectionism, the hostility against acquisitions by foreign groups by companies considered of "strategic" value for the economy of the country. Protectionism is the economic policy of restraining trade between nations, through methods such as high tariffs on imported goods, restrictive quotas, a variety of restrictive government regulations designed to discourage imports, and anti-dumping laws in an attempt to protect domestic industries in a particular nation from foreign take-over...

Objectives

The objective is to support economic activity and promote social cohesion. The supporters of economic patriotism describe it as a kind of self-defence of local economic interests (national or European in case of the countries of the European Union). Some methods of economic patriotism seek to block foreign competition or acquisitions of domestic companies. An often cited example is France, where economic patriotism was the main rationale used in the Pepsico-Danone, Mittal-Arcelor, and GDF-Suez affairs. Face-to-face trading interactions on the New York Stock Exchange trading floor Look up economics in Wiktionary, the free dictionary. ... Social Cohesion is a state in society where the vast majority of citizens respect the law and one anothers human rights. ... In terms of a co-operative this means how much the services of the co-op are used. ... Competition is the act of striving against another force for the purpose of achieving dominance or attaining a reward or goal, or out of a biological imperative such as survival. ...

In the United States, an example of economic patriotism would be the numerous bumper stickers: "Be American, Buy American".

Criticisms

Consumer preference for local goods give local producers more market power and allows local producers to lift prices to extract greater profits. This occurs because firms that produce locally-produced goods can charge a premium for that good. Consumers who favor products by local producers may end up being exploited by profit-maximizing local producers. For example, protectionist policy in America that placed tariffs on foreign cars gaves local producers Ford and GM market power that allowed them to raise prices of cars, which negatively affected American consumers who faced fewer choices and higher prices[1]. However, in most cases where no Cartel is formed, the market forces will create competition for local products, and cause prices to drop. Protectionism is the economic policy of promoting favored domestic industries through the use of high tariffs and other regulations to discourage imports. ... A cartel is a group of legally independent producers whose goal it is to fix prices, limit supplies and limit competition. ...

Because locally-produced goods can attract a premium if consumers show a preference towards it, a firm has an incentive to pass foreign goods off as local goods if foreign goods have cheaper costs of production than local goods. They are able to do this because the line between foreign-made and locally-made is blurry. This brings up the issue of the definition of local goods. For example, while a particular car may be assembled in America its engine may be made in another country, say, China. Furthermore, while the engine may be made in China, the engine's components may be made in several other countries, e.g. the pistons may come from Germany and the spark plugs may come from Mexico. The components that make up the spark plugs and pistons may come from different countries and so on.

See also

• Mercantilism
• Producerism
• The Wimbledon Effect

A painting of a French seaport from 1638, at the height of mercantilism. ... Grange poster depicting the independent, industrious farmer as the keystone figure in society. ... The Wimbledon Effect is a chiefly British (or possibly Japanese []) analogy comparing the success of the All England Lawn Tennis and Croquet Club in Wimbledon, London as the most famous international tennis venue with the global success of the United Kingdoms financial services industry - especially the City - since the...

External links

• The Economic Nationalist (US)
• BBC: Patriotism and protectionism in the EU, 23 March 2006
• 'Buy American' is UN-American by Harry Binswanger, Capitalism Magazine
• Russian Cabinet approves draft bill on restricting foreign investment IHT
• Moscow Spells Out Limits On Access to Resources WSJ 2006