Question

All of the following are arguments in favor of tariffs and quotas except

a. the infant industry argument.

b. the low transition cost argument.

c. the national security argument.

d. the environmental standards argument.

e. the dumping argument.

the environmental standards argument.

the dumping argument.

Answer 1

The correct choice is option B low transition cost argument

Note that trade protection has been favoured by advocates of protectionism on several grounds including the protection of domestic jobs infant industries penalizing the foreign industries that use dumping, differences in environmental degradation in trading partners as well as questions about national security. However there is no such argument as the low transition caused because protectionism actually increases transition costs. Hence it cannot be used in the advocacy of trade barriers.