Chapter 19: Trade and Development
Chapter Learning Objectives
After reading the chapter, you ought to understand and be able to explain:
- The premises, objectives, and policy instruments defining import substitution as a strategy for industrialization.
- The main features of an outward-looking export-led strategy of
industrialization.
- The outcomes generated from pursuit of the two alternative trade strategies.
- The economic effects of tariffs and import quotas, including the distinction between nominal and effective protection.
- How various forms of subsidies are applied to support a country’s chosen industrialization strategy.
- How exchange-rate policy can be managed to influence the pattern of industrialization.
- How protectionist policies encourage rent-seeking practices in lieu of efforts to improve efficiency.
- How Asia’s newly industrializing countries balanced market interventions with competitive pressures, thereby reconciling import substitution and export promotion strategies.
- How multilateral agreements have been adopted to move the world economy toward freer international trade (multilateralism).
- How trade interacts with growth and its effect on poverty. In general terms, what has worked and what has not, with respect to trade and associated policies for industrialization, and why.
Section Menu
Organize
Learn
Connect
Instructors now have an easy way to collect students’ online quizzes with the Norton Gradebook without flooding their inboxes with e-mails.
Students can track their online quiz scores by setting up their own Student Gradebook.
NOTE TO INSTRUCTORS: the answers to the Exercises are found on the Norton Resource Library, not the Gradebook. To access that go to www.wwnorton.com/nrl.