What are arguments in favour of protectionist policies?

Although protectionist policies are generall considered to have more negative effects than positive ones, there are certain instances in which they can be very beneficial. One of those instances is the infant industry argument in which a new and young domestic industry is protected by tariffs or subsidies so that the firms in the industry can grow and increase output and hopefully eventually achieve economies of scale so that they can then compete on the global marketplace. However, how can a government know which industries to protect, and if the industry is protected, dose it lose the incentive to increase efficiency since they can still be profitable thanks to the protection?

Another argument is the strategic trade policy argument which calls for the protection of high tech industries on the grounds that high tech is essential to future economic growth. Japan is a great example of this when they heavily protected semiconductors and are now a world leader in that industry. However, if all countries take the same approach, then nobody truly gains a comparative advantage and furthermore, which industries should be protected is not clear.

Without going into depth, other reasons to maybe introduce protectionist policies could be to; diversify the economy, set tariffs as a form of government revenue, or to increase national security by protecting industries needed in times of war.

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Answered by Alex A. Economics tutor

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