Keywords
automotive
protection cost
import substitution
automotive assembly
employment
investment
How to Cite
Abstract
This paper employs the concept of Effective Protection in order to calculate the real level of protection that has favored the automotive assembly industry in Colombia and to value if this level of protection has helped to achieve the goals of an Import Substitution Policy. A policy that seeks to establish, through this protection mechanism a national industry of consumer durable goods, with an increasing share of domestic inputs generating alongside new dynamics in investment and employment generation. For this purpose, this paper works with data from the Colombian National Manufacture Survey (Encuesta Nacional Manufacturera de Colombia), data provided by the industry on incorporation of local inputs, and a review of changes in policy and legislation affecting the way in which this mechanism operates. Contrary to what would be expected, analysis shows that share of local inputs has decreased, bringing as a result that the cost of protection has been very high when compared to investment and employment generation. The paper concludes with some thoughts as to the convenience of maintaining this type of policy.References
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