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By Christopher D. Gerrard, Greg D. Posehn, Granville Ansong

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Requests for permission to reproduce portions of it should be sent to the Office of the Publisher at the address shown in the copyright notice above. The World Bank encourages dissemination of its work and will normally give permission promptly and, when the reproduction is for noncommercial purposes, without asking a fee. A. The complete backlist of publications from the World Bank is shown in the annual Index of Publications, which contains an alphabetical title list (with full ordering information) and indexes of subjects, authors, and countries and regions.

Tariffs are revenue-creating; the government can in practice implement an import-substitution regime with an extreme degree of bias. Subsidies are expenditure-using; the government cannot in practice implement an export promotion regime with very much bias at all 12 See Anne Krueger (1980), "The Role of the International Sector in Economic Development," (Minneapolis: National Science Foundation Conference on Economic and Political Development) for a more detailed discussion of the nature and consequences of import-substitution and export-promotion regimes.

By raising taxes or increasing interest rates). As a consequence, aggregate demand exceeds what the domestic economy is able to produce or supply with its available resources in the shor term, and inflation accelerates. The long-term and the short-term policy objectives are, of course, related. First, short-term balance is a pre-condition to the achievement of long-term goals. If the government is continually involved in short-term crisis management in response to external and internal imbalances, it will be unable to direct its attention to the achievement of long-term goals.

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