Synopsis
This book explores the advantages of promoting exports as a development strategy, considering the complexities inherent in such a policy. While the author acknowledges that export promotion has led to economic growth in some countries, they caution that it may not be universally beneficial. The author presents a model highlighting the potential for externalities in export industries, where one firm's increased exports benefit others in the sector. To mitigate this, they propose export subsidies. However, they also argue that these subsidies can create distortions and may only be effective in countries capable of producing high-quality goods. The book contends that in equilibrium, the capacity installed in the export sector can serve as a signal of the quality of the exportable good. Countries with inherently low-quality production may subsidize exports to mask this, leading to high initial prices. However, equilibria exist where only high-quality exporters can afford the necessary subsidies, leaving those unable to produce quality goods out of the market. The author warns that promoting exports in all countries may actually harm those capable of producing high-quality goods, as they may be forced to subsidize more heavily to differentiate themselves. Alternatively, it may lead to lower prices for their products. Despite the potential pitfalls, the book emphasizes that promoting exports can be beneficial in certain circumstances, particularly for countries with high-quality production capabilities. It provides insights into the complexities of export promotion policies and their impact on economic development.
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About the Author
Julio Rotemberg is the William Ziegler Professor of Business Administration at the Harvard Business School and a Research Associate of the National Bureau of Economic Research.
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Export Promotion as a Development Strategy (Classic Reprint)
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Paperback. Condition: New. Print on Demand. This book explores the advantages of promoting exports as a development strategy, considering the complexities inherent in such a policy. While the author acknowledges that export promotion has led to economic growth in some countries, they caution that it may not be universally beneficial. The author presents a model highlighting the potential for externalities in export industries, where one firm's increased exports benefit others in the sector. To mitigate this, they propose export subsidies. However, they also argue that these subsidies can create distortions and may only be effective in countries capable of producing high-quality goods. The book contends that in equilibrium, the capacity installed in the export sector can serve as a signal of the quality of the exportable good. Countries with inherently low-quality production may subsidize exports to mask this, leading to high initial prices. However, equilibria exist where only high-quality exporters can afford the necessary subsidies, leaving those unable to produce quality goods out of the market. The author warns that promoting exports in all countries may actually harm those capable of producing high-quality goods, as they may be forced to subsidize more heavily to differentiate themselves. Alternatively, it may lead to lower prices for their products. Despite the potential pitfalls, the book emphasizes that promoting exports can be beneficial in certain circumstances, particularly for countries with high-quality production capabilities. It provides insights into the complexities of export promotion policies and their impact on economic development. This book is a reproduction of an important historical work, digitally reconstructed using state-of-the-art technology to preserve the original format. In rare cases, an imperfection in the original, such as a blemish or missing page, may be replicated in the book. print-on-demand item. Seller Inventory # 9781333252045_0
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Export Promotion as a Development Strategy Classic Reprint
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PAP. Condition: New. New Book. Shipped from UK. Established seller since 2000. Seller Inventory # LW-9781333252045
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