You are a member of a government task force evaluating the future of NAFTA between Canada, Mexico,

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You are a member of a government task force evaluating the future of NAFTA between Canada, Mexico, and the United States. Proponents want to transform NAFTA into a common market by removing barriers to the movement of labor. The goal is to reduce poverty in Mexico by allowing Mexican citizens to work freely in Canada and the United States. Per-capita income in Mexico is less than $10,000, compared to more than $35,000 in both Canada and the United States. Critics oppose the common market because of the huge income difference. They argue an open border would induce millions of Mexicans to migrate northward seeking work and threaten the jobs and wages of millions of Americans and Canadians. Proponents argue that, as economic integration progressed under a common market, average wages in the three countries would equalize and eliminate pressures on northern job markets. Analyze this situation using the Ethical Framework in Chapter 5. Should the task force recommend the common market? Or is the potential harm too great for Canada and the United States? If NAFTA became a common market, what could U.S. and Canadian firms do to maintain their competitiveness relative to Mexican firms, given Mexico’s advantage in low wages?

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International Business and the New Realities

ISBN: 978-0136090984

2nd Edition

Authors: S. Tamer Cavusgil, Gary Knight, John R. Riesenberger

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