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Topics

Import Substitution

Import substitution policies can include putting up trade barriers designed to protect fledgling domestic industries that have not yet achieved sufficient economies of scale to become cost and price competitive in international markets. The infant industry argument is often used as justification for tariffs that increase the prices of substitute products in strategically important industries. Import substitution is described as an inward-looking policy encouraging domestic production as a substitute for / at the expense of imports.

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