What is the infant industry argument in economics?
The infant-industry theory states that new industries in developing countries need protection against competitive pressures until they mature and develop economies of scale that can rival their competitors’.
What does the infant industry argument suggests?
The infant industry argument suggests that protecting infant industries from foreign competitors will allow them time to become large enough to enjoy economies of scale.
What is the meaning of infant industries?
In economics, an infant industry is a new industry, which in its early stages experiences relative difficulty or is absolutely incapable in competing with established competitors abroad.
What is meant by the infant industry argument quizlet?
What is meant by the infant industry argument? The blocking of imports for a short time, to give the affected industry time to mature, before eventually it starts competing on equal terms in the global economy.
Which of the following is an example of the infant industry argument?
Example of the Infant Industry Argument Imposing tariffs on imports. Providing subsidies to infant industries. Imposing quota limitations on imports. Such restrictions are either fixed in terms of the value or quantity of the product to be imported during a given time period (usually for one year).
What is the infant industry argument for protection from international trade quizlet?
What is the infant-industry argument for protection from international trade? Domestic firms must be protected until they gain a comparative advantage.
What is the economic argument in favor of protecting infant industries?
The main rationale behind the infant industry argument is that new industries require protection because they lack the economies of scale that competitors possess. Infant industries lack the capabilities to leverage their existing production and require protection until they can acquire similar economies of scale.
What is the infant industry argument for protection from international trade?
The infant industry argument, a classic theory in international trade, states that new industries require protection from international competitors until they become mature, stable, and are able to be competitive. The infant industry argument is commonly used to justify domestic trade protectionism.
What is an example of the infant industry argument?
Example of the Infant Industry Argument. An example of how this argument can be implemented includes: Imposing tariffs on imports. Providing subsidies to infant industries. Imposing quota limitations on imports.
What is the infant industry argument for protectionism?
The infant industry argument is often cited as a rationale for protectionism and was developed by Alexander Hamilton and Friedrich List. The infant-industry theory states that new industries in developing countries need protection against competitive pressures until they mature.
What is infant industry theory in economics?
In economics, an infant-industry is one that is new and in its early stages of development and, thus, not yet capable of competing against established industry competitors. The infant-industry theory, first developed in the early 19th century by Alexander Hamilton and Friedrich List, is often a justification for protectionist trade policies.
Why don’t we protect the infant industry?
Infant industries lack the capabilities to leverage their existing production and require protection until they can acquire similar economies of scale. In addition, there are various other reasons behind the infant industry argument:
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