国际贸易双语教案Chap024.docVIP

Chapter 14 Trade Policies for Developing Countries Overview This chapter examines trade issues affecting developing countries. It begins by noting differences between high-income developed or industrialized countries and low- and medium-income developing countries, as well as differences among the developing countries. Some developing countries are growing quickly, while others are stagnating or declining. The comparative advantages of developing countries (relative to industrialized countries) derive from abundance of unskilled labor and, for many, abundance of natural resources, as well as a tropical climate for agriculture. Furthermore, financial capital markets and labor markets are less efficient in developing countries. Given these differences, a developing country must decide what trade policy (and other government policies) to adopt. (1) It can focus on exporting primary products based on the country’s comparative advantage in natural resources and its tropical climate. (2) It can adopt a policy that tries to raise world prices for its export of primary products by joining international cartels or taxing its exports. (3) It can tax and restrict imports of manufactured goods to develop new domestic industries through import substitution. (4) It can promote and subsidize new export products, especially manufactured goods. Given the less efficient capital and labor markets, there may be a role for an active government trade policy. The box “Special Challenges of Transition” discusses the roles of trade and trade policy in the efforts by the developing countries of Central and Southeastern Europe and the former Soviet Union to shift from communist central planning to more market-oriented economies. Some developing countries rely on primary products for most of their exports. Evidence indicates that these countries appear to have experienced a slow deterioration in their terms of trade over time. It appears that the adverse effects of Engel’s Law and the develop