What is the idea that a country should be self-sufficient and not participate in international trade called?
Autarky
Understanding Autarky: Economic Self-Sufficiency
The question asks about the idea where a country aims to be self-sufficient and chooses not to participate in international trade. This specific concept is known as Autarky.
Autarky Explained
Autarky refers to a state of national economic self-sufficiency where a country operates without any form of external aid or international trade. In an autarkic system, a nation produces all the goods and services it needs internally, minimizing or completely eliminating imports and exports. The primary goal of a country pursuing Autarky is often to achieve complete economic independence and reduce vulnerability to global market fluctuations or geopolitical pressures.
- A nation aiming for Autarky typically implements strict import restrictions, high tariffs, or even complete trade embargoes to prevent goods from entering or leaving its borders.
- Historically, some countries have attempted Autarky during times of war or political isolation, though it is generally challenging to maintain in the long term due to the diverse needs of a modern economy.
Contrasting Other Options
It is important to understand why the other given options do not fit the description of a country being self-sufficient and avoiding international trade:
| Term | Meaning | Relevance to Question |
|---|---|---|
| Autoclave | A strong, heated container used for chemical reactions and other processes using high pressures and temperatures, e.g., sterilizing medical equipment. | Not related to economics or international trade. |
| Autocracy | A system of government in which one person has absolute power. | Refers to a form of government, not an economic policy regarding self-sufficiency and trade. |
| Autonomy | The right or condition of self-government; political independence. | Refers to political independence and self-governance, distinct from economic self-sufficiency in terms of trade. While an autonomous nation might choose autarky, autonomy itself is not the economic trade policy. |
Based on these definitions, Autarky is the only term that accurately describes a country's policy of being entirely self-sufficient and avoiding participation in international trade.
Important Questions from External Sector and Currency Exchange rate
Consider the following :
1. Foreign currency convertible bonds
2. Foreign institutional investment with certain conditions
3. Global depository receipts
4. Non-resident external deposits
Which of the above can be included in Foreign Direct Investments?
Procedure for online trading involve(s) which of the following step(s)?
I. Make an application to open a Demat Account and Online Trading Account.
II. Allocate funds from the bank account to the trading account.
III. Once the order is confirmed, it is placed in the stock exchange through the online trading system.
According to Harrod-Domar growth model for the full capacity use of capital and labour or for full employment it is necessary that
When the exchange rate changes from 1$ = Rs. 72 to 1$ = Rs. 68, then the:
A. Rupee has depreciated
B. Dollar has depreciated
C. Rupee has appreciated
D. Dollar has appreciated
Choose the correct answer from the options given below:
Overshooting model of exchange rate developed by economists Rudi Dornbush, attempts to establish
