Forced labor occurs whenindividuals are compelled against their will to provide work or service through force, fraud, or coercion.Both the European Union and the United States have proposed laws banning the importation of products made with forced labor.This could potentially apply to products such as sugarcane from Brazil, components for solar panels from China, textiles from Ethiopia, and shrimp from Thailand.

a) Suppose the ban goes into effect and it raises the world price of imported goods made with forced labor. Using the economic analysis of international trade that we have developed in this class, what will be the impact of a ban on imports made with forced labor on EU and US consumers? And on the EU and US economies overall? Explain.

b) Labor unions in the EU and US have been strong supporters of these proposals. Is this in the economic self-interest of unions? Why?

c) We discussed five situations where economists recognize there can be valid reasons for imposing a trade barrier.Which of those situations would seem to best apply here?

d) Suppose that the proposal to ban imports of products made with forced labor is not approved in the US.You are the CEO of a company that imports components for solar panels from China.You are thinking about getting your imports from another country, even though they will cost more.What would Milton Friedman advise you to do?Why?

e) A good CEO wants to hear all the arguments, so you decide to call up a critic of Milton Friedman to get the critic's perspective. What would the Friedman critic advise you to do? Why? Base your arguments on the material we have covered in this class.