Whether the given statement is a valid justification for trade protection. Concept Introduction: Arguments for trade protection: There are various arguments that a country holds in order to protect its domestic market from International trade. The most common arguments for trade protection are: National Security: When a country is in the situation of a conflict or war, it cannot depend on the international trade. Rather, it has to make sure that the country is self-sufficient from its domestic production in such situations. Job Creation: In order to increase the job creation in the country, the imports of certain goods are restricted. When the imports are restricted, consumers are bound to purchase the domestic products. Hence, an increase in the demand of domestic products creates more employment opportunities for domestic workers. Infant Industry: Infant industry is that industry which is new in the country. An infant industry is not strong enough in its initial period to compete with the international trade. Hence, in the initial period, the import is restricted to protect the domestic producers in order to let them gain stability.

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Chapter 8, Problem 16P

To determine

Whether the given statement is a valid justification for trade protection.

Concept Introduction:

Arguments for trade protection: There are various arguments that a country holds in order to protect its domestic market from International trade. The most common arguments for trade protection are:

National Security: When a country is in the situation of a conflict or war, it cannot depend on the international trade. Rather, it has to make sure that the country is self-sufficient from its domestic production in such situations.

Job Creation: In order to increase the job creation in the country, the imports of certain goods are restricted. When the imports are restricted, consumers are bound to purchase the domestic products. Hence, an increase in the demand of domestic products creates more employment opportunities for domestic workers.

Infant Industry: Infant industry is that industry which is new in the country. An infant industry is not strong enough in its initial period to compete with the international trade. Hence, in the initial period, the import is restricted to protect the domestic producers in order to let them gain stability.

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