What are main reasons for protecting “infant industries”? Why is it difficult to stop protecting them?

Infant industries are newly established industries that have not yet had the opportunity to grow and develop enough to be competitive in the global market. These industries usually lack the economies of scale, resources, and experience that their established competitors have.

There are several reasons why governments may choose to protect infant industries: 1. Fostering Economic Growth: Supporting infant industries can help grow the domestic economy by creating jobs, promoting investment, and encouraging innovation. 2. National Security: Developing certain industries (e.g., technology, defense, energy) may be crucial for a country’s national security and stability. 3. Diversification: Supporting a variety of industries can help a country diversify its economic base and reduce dependence on foreign imports. 4. Protecting Domestic Jobs: Government protection can help safeguard jobs in infant industries by shielding them from foreign competition. 5. Encouraging Innovation: Protecting infant industries may stimulate innovation, research, and development as firms strive to increase their competitiveness.

There are several reasons why it can be difficult to stop protecting infant industries: 1. Political Pressure: Established infant industries may lobby governments to maintain protectionist measures to remain competitive and profitable. Additionally, the protection of infant industries may have political consequences if removing protections results in job losses. 2. Dependency on Protection: Infant industries that have been protected for too long can become dependent on subsidies and trade barriers. This makes it difficult for these industries to compete without protection, causing them to continue relying on government support. 3. Identifying the Right Time to End Protection: It is challenging to determine when an industry has matured enough to compete without protection. Stopping protection too soon might hinder the industry's development, while waiting too long can lead to dependency on subsidies. 4. Fear of Global Competition: Governments may fear that removing protection will expose infant industries to global competition, which could lead to their collapse and negative economic effects. 5. Short-term Negative Impacts: Removing protectionist measures may lead to short-term negative effects such as job losses and decreased GDP, making it politically unpopular to end protection. In conclusion, protecting infant industries is seen as essential for fostering economic growth, national security, diversification, protecting domestic jobs, and encouraging innovation. However, it's difficult to stop protecting these industries due to political pressure, dependency on protection, identifying the right time to end protection, fear of global competition, and short-term negative impacts.