Unit 4: Protectionism and development

All, just thought I'd share an e mail I sent Gabriele to answer the question about how prtectionism can help increase efficiency of firms......

the argument about protectionism increasing efficiency is a valid one. It suggests that (for example) the protection of infant industries allows firms to increase investment without damaging competition hurting their profits.

This is an argument for development as well. ie increase barriers, invest in infrastructure and capital...become competitive, lower barriers......trade :-)
Obviously, the big issue is where do you get cash from in first place? Difficult to get IMF loans, cos they will say, only if you lower barriers!