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Suggested Articles for 6th July 2015

These are Suggested Articles for 6th July 2015 from The Hindu and Indian Express also included in the post are daily current affairs from various sources.

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3 thoughts on “Suggested Articles for 6th July 2015”

    • hi,

      A beggar-thy-neighbour policy is an economic policy through which one country attempts to remedy its economic problems by means that tend to worsen the economic problems of other countries.

      The classic definition of beggar-my-neighbour policies was provided in 1937 by the British economist Joan Robinson. For any one country, Robinson argued, an induced increase in exports relative to imports leads to more jobs. In addition to the initial increase in employment, there is a secondary increase from the money spent by the newly employed workers. The snag, as she pointed out, is that an increase in the exports of one country leads to a decline in exports of other countries, “everything else being equal”. At best “it leaves the level of employment for the world as a whole unaffected” and probably reduces it.

      Robinson’s explanation of the probable consequences is also worth remembering. She wrote that “as soon as one country succeeds in increasing its trade balance at the expense of the rest, others retaliate” and the volume of international trade sinks as a proportion of world activity. “Political, strategic and sentimental considerations add fuel to the fire and the flames of economic nationalism blaze higher and higher.”
      She contrasted this with an increase in domestic employment brought about by home investment. This “brings about a net increase in employment for the world as a whole”. Today, for “home investment” we can substitute any purely domestic demand stimulus In my view, the persistence of the balanced budget dogma, which inhibits such stimuli, is one of the reasons for the continued attraction of beggar-my-neighbour policies.

      From FT.

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