policies with development

Question 1

import substitution and export promotion

Answer 1

1)import sub:
-tarriffs imported on manufactured goods (infant industry)
-protect domestic jobs, protect economy from foreign influence and politics MNC
-short-run job creation, loss of comparative advantage gains, retaliation

2) export promotion: remove protectionism, encourage trade (rise in development)
-primary product dependence of developing countries, potential tech advancements
-protectionsim abroad, inequality, over dominance of MNCs

Question 2

markets, trade agreements and diversification

Answer 2

1)trade liberalisation: role of markets, fiscal discipline, market/trade liberalisation. allow e.r to run freely and open up let countries c.a.
-sustainable growth + development, reducing market failures, creating macro stability trickle down effect
-more poverty creation, MNCs with too much power, increase inequality

4) bilateral trade agreements
-better market access, greater spec gains
-increase c of p (trade diversion), trade barriers in other countries