Local content requirements and industrial development : economic analysis and cost modeling of the automotive supply chain

Abstract

This dissertation addresses the issue of performance standards in developing nations, focusing on the role of local content requirements. It proposes a theoretical framework to understand the impact of this policy on the decisions of firms and the welfare of the domestic economy, and offers a methodology to apply the analysis to the context of the automotive supply chain. The central conclusion of the thesis relates to the existence of a gap between private and social opportunity returns and costs, an aspect that has been overlooked by previous literature.

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