Comment by lodovic
15 days ago
This essentially amounts to subsidizing industries that aren't competitive. It's like choosing to bake bread at home for $5 when you could buy it for just $2.
15 days ago
This essentially amounts to subsidizing industries that aren't competitive. It's like choosing to bake bread at home for $5 when you could buy it for just $2.
Or it could be interpreted as putting a higher value on self-sufficiency and domestic production capacity than standard free trade economic theories value those things at ($0).
Standard comparative advantage narratives don't really account for production "webs" being ecosystems that get big synergies from colocation. They do not account for geopolitical risks either.
True, it keeps wealth circulating domestically, fostering local economic activity. However, drawbacks of this system are higher costs for consumers and inefficiencies in production, so it needs to be balanced.
> This essentially amounts to subsidizing industries that aren't competitive.
That's not a bad thing, especially if they are "not competitive" because foreign workers can be exploited more (and not some real competitive advantage).
There are more desirable things than the few neoliberalism optimizes for.