Import tariffs: the neutralization of the Dutch disease argument

Tarifas de importação: o argumento da neutralização da doença holandesa

ABSTRACT

In economics, there is just one argument legitimising import tariffs - the infant industry argument -, but it ceases to be valid as the required learning time ends. This note offers a second argument: the neutralisation of the Dutch disease argument. If the country faces this competitive disadvantage, import tariffs and export subsidies may be a way of circumventing the problem. Many countries that industrialised were only successful because they pragmatically neutralised the disease with import tariffs.

KEYWORDS:
Infant industry; Dutch disease; import tariffs; neutralisation