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Theory is not trustworthy. Here in Iran, we have had extreme protectionist policies for decades in, e.g., cars, and all it has done is made the car factory owne
by Siira 6y ago
Theory is not trustworthy. Here in Iran, we have had extreme protectionist policies for decades in, e.g., cars, and all it has done is made the car factory owners rich while car quality stagnates and regresses, and prices keep rising.
- jopsen 6y agoI think GP argues that poor countries should be allow to have protectionism while being able export goods without tariffs. I doubt that's the situation Iran is in.. it more like isolation. Because Iranian car manufacturers have no ability to import machines, or try to and export cars. I would imagine they aren't pushed to compete with foreign competitors.. and once sanctions disappear they will disappear with them. If Iran wasn't sanctioned, could import machinery, and was allowed to export cars without cribbling tariffs, while it could forbid import of cars. Then maybe car manufacturers would get good enough to compete internally. Or at least that's the theory GP is arguing, as I understand it. Maybe, it holds up, being able to do protectionism without retaliation might be beneficial. Or maybe it would just lead to a inefficiet car industry that never manages to export anything, and is only continues to exist due to protectionism.. I don't know -- but protectionism might not be the way to create efficient industries. Or maybe it can be?