Vulnerability of economies to import penetration


Increased import penetration and loss of competitiveness of domestic industries can lead to mounting pressures for protectionism. The governments of many industrialized nations have introduced restraints against developing countries' exports of manufactures, largely for the reason of preserving domestic jobs.


Late 1980's studies into the likely impact on employment of increasing imports in Germany, the UK and the USA, indicated that the overall magnitude of labour displacement would not be large. For many imports, the required increase in demand to offset the assumed increase in imports from the developing countries was insignificant. For others it was high and not likely to be attained, especially in view of the low-income elasticity of the demand for these products, which include clothing and footwear, leather and leather products, and wood and cork products. The labour displacement effect of increased imports was also modest and seemed far more manageable than the displacement effect resulting from increases in labour productivity in these three industrialized countries.

Related UN Sustainable Development Goals:
GOAL 8: Decent Work and Economic GrowthGOAL 10: Reduced InequalityGOAL 12: Responsible Consumption and Production
Problem Type:
D: Detailed problems
Date of last update
04.10.2020 – 22:48 CEST