A piece of advise on what small emerging economies can do when the giants are fighting currency wars.
"A better solution would be to encourage the domestic demand for manufactures. Demand could be encouraged through, inter alia, tax credits for purchases of household appliances like those with which Japan has experimented. Married with some further appreciation of the currency, this would leave the demand for manufacturing products unchanged.
Better still would be to figure out exactly which manufacturing sectors are sources of learning-by-doing and technology spillovers. Not all manufacturing sectors, presumably, are. Only those which generate these favourable external effects for growth should be the recipients of preferential tax treatment."
No comments:
Post a Comment