The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Infant Industry

  • Gerald M. Meier
Reference work entry


Opposing arguments for free trade and protection constitute the longest-standing policy debate in the history of economic thought. In this debate the infant-industry argument has acquired pride of place as an exception to free trade – especially as trade theory now gives more attention to explicitly dynamic analysis instead of being confined to comparative statics. But the argument must be carefully stated, and when expressed in its precise modern form its applicability is narrowly limited.

This is a preview of subscription content, log in to check access.


  1. Balassa, B. 1980. The process of industrial development and alternative development strategies, Essays in International Finance No. 141. Princeton: Princeton University, December.Google Scholar
  2. Baldwin, R.E. 1969. The case against infant-industry tariff protection. Journal of Political Economy 77(3): 295–305.CrossRefGoogle Scholar
  3. Bardhan, P.K. 1970. Economic growth, development and foreign trade. New York: Wiley.Google Scholar
  4. Bell, M., B. Ross-Larson, and L.E. Westphal. 1984. Assessing the performance of infant industries. Journal of Development Economics 16: 101–128.CrossRefGoogle Scholar
  5. Bhagwati, J. N. 1971. The generalized theory of distortions and welfare. In Trade, balance of payments and growth, ed. J.N. Bhagwati, et al. Amsterdam: North-Holland, ch. 12.Google Scholar
  6. Bhagwati, J.N. 1978. Foreign trade regimes and economic development: Anatomy and consequences of exchange control regimes. New York: National Bureau of Economic Research.Google Scholar
  7. Bhagwati, J.N., and V.K. Ramaswami. 1963. Domestic distortions, tariffs and the theory of optimum subsidy. Journal of Political Economy 71: 44–50.CrossRefGoogle Scholar
  8. Clemhout, S., and H.Y. Wan. 1970. Learning-by-doing and infant industry protection. Review of Economic Studies 37: 33–56.CrossRefGoogle Scholar
  9. Corden, W.M. 1971. The theory of protection. Oxford: Clarendon Press.Google Scholar
  10. Corden, W.M. 1974. Trade policy and economic welfare. Oxford: Clarendon Press.Google Scholar
  11. Corden, W.M. 1984. Normative theory of international trade. In Handbook of international economics, vol. 1, ed. R.N. Jones and P.B. Kenen. Amsterdam: North-Holland.Google Scholar
  12. Hamilton, A. 1791. Report on manufactures. Reprinted in US Senate Documents XXII/172, Washington, DC: Congress, 1913.Google Scholar
  13. Johnson, H.G. 1965. Optimal trade intervention in the presence of domestic distortions. In Trade, growth, and the balance of payments, ed. R. Caves, H.G. Johnson, and P.B. Kenen. New York: Rand McNally.Google Scholar
  14. Johnson, H.G. 1970. A new view of the infant industry argument. In Studies in international economics: Monash conference papers, ed. A. McDougall and R.H. Snape. Amsterdam: North-Holland.Google Scholar
  15. Kemp, M.C. 1960. The Mill–Bastable infant-industry dogma. Journal of Political Economy 68(February): 65–67.CrossRefGoogle Scholar
  16. Krueger, A.O. 1974. The political economy of the rent-seeking society. American Economic Review 64: 291–303.Google Scholar
  17. Krueger, A.O. 1978. Foreign trade regimes and economic development: Liberalization attempts and consequences. Cambridge, MA: Ballinger for the National Bureau of Economic Research.Google Scholar
  18. Krueger, A.O. 1981. Export led industrial growth. In Trade and growth of the advanced developing countries in the Pacific Basin, ed. W. Hong and L.B. Krause. Seoul: Korea Development Institute.Google Scholar
  19. Krueger, A.O. 1984. Trade policies in developing countries. In Handbook of international economics, vol. I, ed. R.W. Jones and P.B. Kenen. Amsterdam: North-Holland.Google Scholar
  20. Krueger, A.O., and B. Tuncer. 1982. An empirical test of the infant industry argument. American Economic Review 72(5): 1142–1152.Google Scholar
  21. List, F. 1841. Das nationale System der Politischen Oekonomie. Jena: Gustav Fischer, 1920. Trans. by G.P.A. Matile as National system of political economy. Philadelphia: Lippincott, 1856.Google Scholar
  22. Little, I.M.D., T. Scitovsky, and M.F.G. Scott. 1970. Industry and trade in some developing countries: A comparative study. London: Oxford University Press.Google Scholar
  23. Marshall, A. 1919. Industry and trade. London: Macmillan, Appendix G, 2.Google Scholar
  24. Mayer, W. 1984. The infant-export industry argument. Canadian Journal of Economics 17(May): 249–269.CrossRefGoogle Scholar
  25. Meade, J.E. 1955. Trade and welfare. New York: Oxford University Press.Google Scholar
  26. Mill, J.S. 1848. Principles of political economy, ed. W.J. Ashley. London: Longmans Green, 1909.Google Scholar
  27. Taussig, F.W. 1888. The tariff history of the United States. New York: G.P. Putnam’s Sons.Google Scholar
  28. Viner, J. 1937. Studies in the theory of international trade. New York: Harper & Bros.Google Scholar
  29. Westphal, L.E. 1981. Empirical justification for infant industry protection, World Bank Staff Working Paper No.445. Washington, DC: World Bank, March.Google Scholar

Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Gerald M. Meier
    • 1
  1. 1.