Economists favor export promotion over import substitution as a policy for economic growth because:
A)it provides infant industries with a protected market.
B)it favors replacing high-cost foreign goods with low-cost domestic goods.
C)it improves the efficiency of foreign producers.
D)it emphasizes comparative advantage and trade expansion.
E)it emphasizes trade restrictions and helps provide a market for domestic goods.

Question

Quizplus · Accepted Answer

Economists favor export promotion over import substitution because it emphasizes comparative advantage and trade expansion. This leads to a focus on producing goods that a country has a comparative advantage in and trading with other countries, rather than attempting to produce all goods domestically and relying on trade restrictions. This approach has been shown to lead to greater economic growth and increased efficiency.

Economists Favor Export Promotion Over Import Substitution as a Policy