DEFINITION of 'Trade Act Of 1974'
Legislation passed by U.S. Congress to expand U.S. participation in international trade and reduce trade disputes. The act provided the authority to reduce or eliminate trade barriers, improve relationships with nonmarket (Communist) and developing economies, and change to injurious and unfair competition laws.
The act also provided relief for American industries negatively affected by increased international trade and changed tariffs on imports from developing countries. Further, it provided for U.S. action against foreign countries whose import activities unfairly disadvantaged American labor and industry.
BREAKING DOWN 'Trade Act Of 1974'
International trade has long been a contentious political and economic issue. Opponents of it argue that it takes jobs away from domestic workers. Proponents argue that, while international trade may force domestic workers to move into other lines of work, free trade takes full advantage of specialization and division of labor to improve economic conditions in all participating countries.