Policies designed to promote import substitution often encouraged capital-intensive production methods.

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Import substitution policies, aimed at reducing foreign dependency by encouraging local production of goods previously imported, often led to the adoption of capital-intensive production methods. This was because these policies typically involved government support for industries through subsidies, tariffs, and other forms of protectionism, which made it financially viable for firms to invest in expensive machinery and equipment to produce goods domestically.

Policies Designed to Promote Import Substitution Often Encouraged Capital-Intensive Production