Explain the negative impact of industrial policy?
Dear Student,
Negative impacts of industrial policy are as under:-
1) Public sector monopolies gradually turned out to be a 'dead social weight'. By incurring heavy losses, public sector enterprise led to insufficient use of resources.
2) Protection of domestic industries stimulated its growth. But, it failed to achieve international standards of product quality.
3) Saving foreign exchange through import substitution proved to be an inefficient policy instrument.
Regards
Negative impacts of industrial policy are as under:-
1) Public sector monopolies gradually turned out to be a 'dead social weight'. By incurring heavy losses, public sector enterprise led to insufficient use of resources.
2) Protection of domestic industries stimulated its growth. But, it failed to achieve international standards of product quality.
3) Saving foreign exchange through import substitution proved to be an inefficient policy instrument.
Regards