Effects of industrial protection and exchange rate policies on a traditional export crop sector: a study of the Sri Lankan rubber industry, 1950-80
1986
Jayasuriya, S.K. | Barlow, C. (Australian National University, Canberra (Australia). Research School of Pacific Studies)
The relative contraction of the Sri Lankan rubber industry was attributable not only to the well known effects of export taxes but also to other government policies emanating from a development strategy of industrialisation through import substitution. The effects of protection for industry and the (related) appreciation of the real exchange rate exerted reverse pressures on the export crops such as rubber and had undesirable efficiency and equity implications. It was demonstrated that nominal devaluations may not have the expected results of stimulating investments in export industries with long gestation periods
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