Farm worker may pick lettuce or tomatoes for a rich landowner and both may benefit from

the transaction. And don’t Russia consumers gain when they buy a Taiwanese vest pocket radio

priced at $12 as opposed to a qualitatively similar Russian-made radio selling for $20?

In the long-run a nation must import in order to export. Hence, the long-run impact of tariffs

Is not to increase domestic employment but at best to reallocate workers away from export industries

And toward protected domestic industries. This shift implies a less efficient allocation of resources.

Tariffs divert resources away from those industries in which production is so efficient as to

Provide a comparative advantage. There is little doubt that intelligent, well-timed monetary and

Fiscal policies are preferable to tariff and quota adjustments as anticyclical techniques.

D) Some considerations about the expediency of protectionism

The infant-industry argument contends that protective tariffs are needed for the purpose of allowing

New domestic industries to establish themselves. Temporarily shielding young domestic firms

From the severe competition afforded by more mature and therefore currently more efficient foreign

Firms will give the infant industries a chance to develop and become efficient producers. Though the