Infant Industry Argument in Favor of Protecting Commercial Policy of a Country

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Infant industry argument in favour of protection becomes stronger and more relevant to the underdeveloped countries when this argument is considered in its broader sense, i.e., in terms of infant country argument.

In other words, instead of applying the infant industry argument to one industry or group of related industries, we should apply this argument to a whole sector (i.e., to the industrial sector) of the underdeveloped economy.

By definition, and underdeveloped economy is that which is not reaping full gains from its potential (long-term) comparative cost advantage.

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Protection will not only help an underdeveloped country to develop those industries in which it has potential comparative advantage, but will lead to a better distribution of world output and resources.

When protection is given to many (instead of one) infant industries, the gains from internal and external economies of scale and from the training up of a skilled labour force will also be greater.

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