Chapter 10 Trade Policy in Developing Countries
Chapter 10 ▪ Trade Policy in Developing Countries
Chapter Organization Introduction Import-Substituting Industrialization Problems of the Dual Economy Export-Oriented Industrialization: The East Asian Miracle Summary Copyright C 2003 Pearson Education, Inc Slide 10-2
Copyright © 2003 Pearson Education, Inc. Slide 10-2 Chapter Organization ▪ Introduction ▪ Import-Substituting Industrialization ▪ Problems of the Dual Economy ▪ Export-Oriented Industrialization: The East Asian Miracle ▪ Summary
Introduction There is a great diversity among the developing countries in terms of their income per capita Why are some countries so much poorer than others? For about 30 years after World War II trade policies in many developing countries were strongly influenced by the belief that the key to economic development was creation of a strong manufacturing sector The best way to create a strong manufacturing sector was by protecting domestic manufacturers from international competition Copyright C 2003 Pearson Education, Inc Slide 10-3
Copyright © 2003 Pearson Education, Inc. Slide 10-3 ▪ There is a great diversity among the developing countries in terms of their income per capita. ▪ Why are some countries so much poorer than others? • For about 30 years after World War II trade policies in many developing countries were strongly influenced by the belief that the key to economic development was creation of a strong manufacturing sector. – The best way to create a strong manufacturing sector was by protecting domestic manufacturers from international competition. Introduction
Introduction Table 10-1: Gross Domestic Product Per Capita, 1999(dollars United States 33900 Japan 23.400 Germany 22.700 Singapore 27,800 South Korea 13,300 Mexico 8.500 China 3.800 India 1.800 Source: CIA. World Factbook. 2000 Copyright C 2003 Pearson Education, Inc ide 10-4
Copyright © 2003 Pearson Education, Inc. Slide 10-4 Introduction Table 10-1: Gross Domestic Product Per Capita, 1999 (dollars)
Import-Substituting Industrialization From World War II until the 1970s many developing countries attempted to accelerate their development by limiting imports of manufactured goods to foster a manufacturing sector serving the domestic market a The most important economic argument for protecting manufacturing industries is the infant industry argument Copyright C 2003 Pearson Education, Inc Slide 10-5
Copyright © 2003 Pearson Education, Inc. Slide 10-5 ▪ From World War II until the 1970s many developing countries attempted to accelerate their development by limiting imports of manufactured goods to foster a manufacturing sector serving the domestic market. ▪ The most important economic argument for protecting manufacturing industries is the infant industry argument. Import-Substituting Industrialization