Economists would tend to accept which of the following arguments in favour of tariffs?

Question

Quizplus · Accepted Answer

Economists may accept the argument that temporary tariff protection in certain situations could help a country develop a comparative advantage in a particular product. This is because tariffs can increase the price of imports, making domestic products relatively more competitive. Over time, this encourages the development of domestic industries that can produce the same goods at a lower cost, thereby creating a comparative advantage. This approach, however, should be accompanied by strategies to improve competitiveness through innovation, research and development and investment in new technologies. Other arguments, such as tariffs to stimulate the domestic economy, to avoid exporting jobs or to limit imports and reduce capital flow are controversial and could have negative impacts on the economy. Additionally, tariffs may increase prices and lead to inflation rather than reducing it, making choice E incorrect.

Economists Would Tend to Accept Which of the Following Arguments