Policies like tariffs designed to protect domestic industries from competition are called what?

Policies like tariffs designed to protect domestic industries from competition are called what?

• A. Protectionism
• B. Tariff Policy
• C. Liberalism
• D. Mercantilism

Answer: (A)

Protectionism is the idea of shielding domestic industries from foreign competition by using trade barriers. Tariffs are a classic tool of protectionism: by adding a tax to imported goods, they raise their price and make domestically produced products more attractive. This can help protect jobs and industries at home, though it can also raise prices for consumers and invite retaliation. Tariff Policy is just one instrument within protectionism, focusing on the specific mechanism of taxation on imports. Liberalism, in contrast, favors freer trade with fewer barriers. Mercantilism is an historical framework that often embraces protectionist measures as a means to build national wealth, but it’s broader than the simple policy of protection against foreign competition.

Protectionism is the idea of shielding domestic industries from foreign competition by using trade barriers. Tariffs are a classic tool of protectionism: by adding a tax to imported goods, they raise their price and make domestically produced products more attractive. This can help protect jobs and industries at home, though it can also raise prices for consumers and invite retaliation.

Tariff Policy is just one instrument within protectionism, focusing on the specific mechanism of taxation on imports. Liberalism, in contrast, favors freer trade with fewer barriers. Mercantilism is an historical framework that often embraces protectionist measures as a means to build national wealth, but it’s broader than the simple policy of protection against foreign competition.