Excessive protection of industries by customs duties


The inordinate protection given industry by customs duties in a given country acts as a deterrent to, and decisively affects, the domestic market for industrialization. Whilst such protection was undoubtedly considered essential to the development of industry in the early stages of industrialization, its persistence as a policy has created such a barrier of tariffs and restrictions that industries become isolated from world markets and thereby are deprived of the advantages offered by healthy competition from abroad. Because of the exclusive concern with the domestic market, together with the limited size of such a market, restrictive and monopolistic practices develop which weaken incentives to technical progress and the corresponding increase in productivity.

Problem Type:
D: Detailed problems
Related UN Sustainable Development Goals:
GOAL 12: Responsible Consumption and Production
Date of last update
17.06.2019 – 15:25 CEST