alt Hacker NewsI think to nurture developing industries, it can be fine, but at some point you have to expose them to competition if you want to exceed what the domestic market can do.
I think to nurture developing industries, it can be fine, but at some point you have to expose them to competition if you want to exceed what the domestic market can do.
Domestic industries DO compete - both with each other AND with foreign companies which are levied with tariffs.
One of the reason why China's import substitution was almost unreasonably effective was because domestic companies were driven to compete fiercely with each other.
(In America there is a drive to do the opposition- wall street likes consolidation and oligopolies)
And yeah, once your national industrial ecosystem is sufficiently powerful most countries suddenly get religion about removing all tarriffs everywhere. This is what America was like in the 90s - and they were just as obnoxious about that as they are about this - the exact opposite.