The relationship between import substitution policies and export-led development policies is best characterized by which of the following?
A)Import-substitution policies are more likely to lead to production of mature products, whereas export-led development policies result in production of growth products.
B)The two are hard to distinguish because production under import substitution may eventually be exported.
C)Production under import substitution policies, as opposed to export-led development policies, is more likely to be located in urban areas.
D)Production under import substitution policies, as opposed to export-led development policies, is likely to be more labor-intensive.

Question

Quizplus · Accepted Answer

Import substitution policies and export-led development policies are not mutually exclusive. In fact, many countries that implemented import substitution policies eventually transitioned towards export-led development as they strengthened their domestic industries and were able to compete in global markets. Additionally, production under import substitution policies may eventually be exported if the domestic market is saturated or if there is demand for the product in other countries. Therefore, it can be difficult to distinguish between the two policies.

The Relationship Between Import Substitution Policies and Export-Led Development Policies