Live revision! Join us for our free exam revision livestreams Watch now


Expenditure switching policies

These are policies designed to change the relative prices of exports and imports to help reduce the size of a country's external deficit. For example - an exchange rate depreciation can improve the price competitiveness of exports and make imports more expensive when priced in a domestic currency. Import tariffs are designed to create expenditure-switching effects by making imports more expensive.

© 2002-2024 Tutor2u Limited. Company Reg no: 04489574. VAT reg no 816865400.