The Temptation of Protectionism and American Trade Policy

Robert J. Carbaugh, Central Washington University
Tyler Prante

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The financial crisis that began in 2007 and gained momentum in 2008 shoved the world economy into a severe economic slump that some have called the Great Recession. The crisis originated in the United States housing market and quickly spread throughout the economies of the US, Canada and Europe. Soon these countries were importing fewer goods produced by emerging countries and the crisis became global. International trade collapsed at a pace unseen since the Great Depression of the 1930s. What accounted for the rapid decline in trade?