Beggar thy neighbour
From Wikipedia, the free encyclopedia
Beggar thy neighbour, or beggar-my-neighbour; policies that seek benefits for one country at the expense of others. Such policies attempt to remedy the economic problems in one country by means which tend to worsen the problems of other countries. The term was originally devised to characterize policies of trying to cure domestic depression and unemployment by shifting effective demand away from imports onto domestically produced goods, either through tariffs and quotas on imports, or by competitive devaluation. More recently, beggar thy neighbour policy has taken the form of reducing domestic inflation through currency appreciation. This improves the terms of trade and thus reduces cost-inflationary pressure in the appreciating country but tends to increase cost inflation in the country's trading partners.
"Beggar thy neighbour" strategies of this kind don't only apply to countries: overgrazing provides another example, where the pursuit by individuals or groups of their own interests leads to sub-optimal outcomes. This dynamic is also known as the "tragedy of the commons."
The phrase is in widespread use, and is used in such publications as The Economist[1] and BBC News[2], and presumably originates from the name of the Beggar-My-Neighbour card game.
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The Tragedy of the Commons is different, to the extent, that it refers to the cost of maintaining a Public good. No one individual finds it worthwhile to maintain the Common land (or Public Property), and therefore it starts to suffer from overuse, and neglect.
