Question

why is trade barrier called 'barrier' ? how can govenments make use of it?

Answer 1

Trade barrirer are often called "Barrier" because their stated purpose is to shield.

Answer 2

barrier is anything which is a restriction...
trade barrier is a restriction imposed on the trade between countries..
the government may make use of it to boost the economy..as well as to protect the domestic industries..
for ex- when India became independent many small industries were coming up and could not bear the pressure of the foreign companies so no trade was allowed but only essential items could be imported..

but when the world Bank asked the country to liberalise trade in 1991, to allow foreign companies to come in and set up their industries ..the borrowing was increasing and quality decreasing.. the competition would ensure quality of Indian products and help them prosper as well so foreign trade barrier was removed.

hope this helps .
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