Import Substitution Flashcards
1
Q
What is import substitution
A
Goods previously imported are replaced by local manufacturing
Inward policy
2
Q
Methods for import substitution
A
Tariffs
Quotas
Subsidies
Embargoes
3
Q
Why promote import substitution
A
Allows for diversification
Trade
Employment increase
Economic growth
4
Q
Advantages of import substitution
A
Increase employment… GDP
product variety
Positive BOP
industrial development
5
Q
Disadvantages of import substitution
A
Imports don’t necessarily decrease
Artificial products created
Reduced competition
Local production can be inadequate
