The Dominican Republic is an economy that is primarily based on agriculture and tourism. If the United States banned the Dominican Republic from exporting its agricultural goods, then its economy would be severely hurt. However its affect on the tourist market might have the opposite affect. Though the two markets are separate they are closely linked to the total economic stability of the nation. The Dominican Republics agriculture market and tourist market have very different supply and demand curves.
If the U.S. banned the Dominican Republic from exporting agricultural goods then a large portion on the nations productivity would decline. If there is no one to sell the goods to then the farmers will stop producing food, this shows that there is an elastic supply for their agricultural goods. However these farmers will not get paid, and hence they will not spend their money on other peoples products. This leads to a downward spiral that is difficult to pull out of. With less money coming in the Dominican people have less money to spend on their advertising for tourists, and as a result fewer people will come to the resorts. Also the Dominicans would have less money to spend on the upkeep of the current resorts, making it a less desirable destination. However, even if not as many people are coming to them these resorts will still be there. They have a very inelastic supply, because they can not stop producing their services, because the buildings are already there. In order to try to attract more customers the resorts will be forced to lower their prices, driving up the consumer surplus. Although this may be good for the consumer, most of the consumers will be from other nations, and they will be paying less for their vacations. Once again the Dominican Republic will be having less money coming into their country. Ethically this ban would be wrong, because it would put so many people out of work. With the country in an economic recession, the people would not be able to find new jobs. They would be forced into crime, drugs or worse.
Considering the effects of this ban leads to the conclusion that it would be very detrimental to the economic health of the Dominican Republic. Their agricultural market would collapse which would put a large portion of their population out of work. With this money absent from the country they would be hard pressed to keep their resorts in good condition, and advertised properly. These resorts, regardless of whether or not there are many people in them, would still exist, and money would be lost all across the board. This ban would have no positive effects on the Dominican Republic.
If the U.S. banned the Dominican Republic from exporting agricultural goods then a large portion on the nations productivity would decline. If there is no one to sell the goods to then the farmers will stop producing food, this shows that there is an elastic supply for their agricultural goods. However these farmers will not get paid, and hence they will not spend their money on other peoples products. This leads to a downward spiral that is difficult to pull out of. With less money coming in the Dominican people have less money to spend on their advertising for tourists, and as a result fewer people will come to the resorts. Also the Dominicans would have less money to spend on the upkeep of the current resorts, making it a less desirable destination. However, even if not as many people are coming to them these resorts will still be there. They have a very inelastic supply, because they can not stop producing their services, because the buildings are already there. In order to try to attract more customers the resorts will be forced to lower their prices, driving up the consumer surplus. Although this may be good for the consumer, most of the consumers will be from other nations, and they will be paying less for their vacations. Once again the Dominican Republic will be having less money coming into their country. Ethically this ban would be wrong, because it would put so many people out of work. With the country in an economic recession, the people would not be able to find new jobs. They would be forced into crime, drugs or worse.Considering the effects of this ban leads to the conclusion that it would be very detrimental to the economic health of the Dominican Republic. Their agricultural market would collapse which would put a large portion of their population out of work. With this money absent from the country they would be hard pressed to keep their resorts in good condition, and advertised properly. These resorts, regardless of whether or not there are many people in them, would still exist, and money would be lost all across the board. This ban would have no positive effects on the Dominican Republic.
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