Explain the infant industry argument

What will be an ideal response?

The infant industry argument is an argument for tariff protection for a domestic industry that is relatively new. If there are economies of scale or benefits from experience, the industry may not have a chance to develop and secure either experience or economies of scale if they face competition from established foreign firms. The argument is that after a period of time, the industry would be able to compete without tariff protection.

Economics

You might also like to view...

Innovation and new ideas are rewarded in a nation with a traditional economy.

a. true b. false

Economics

Which of the following is an example of a price floor?

a. rent controls b. maximum prices for gasoline c. usury laws that set maximum interest rates d. the minimum wage

Economics