For citation:
Tsedilin, L. I. (2025). Comparative Analysis of Import Substitution Models in the Technological Sphere. AlterEconomics, 22(4), 737–752. https://doi.org/10.31063/AlterEconomics/2025.22-4.10
Abstract:
This paper compares two theoretical approaches to analyzing import substitution models as a key area of economic policy for achieving technological sovereignty. Most publications on import substitution focus on practical aspects, while theoretical considerations are often overlooked. The paper argues that import substitution is not merely a production-related technological phenomenon; a meaningful analysis must also consider its economic dimension. Therefore, this study examines import substitution from a theoretical perspective, emphasizing economic efficiency. The paper explores two approaches to import substitution. The first focuses on developing domestic industries using national potential, with independence as the primary policy objective. This approach, grounded in protectionist theory, often relies on state funding and may disregard production profitability. The second approach aligns with the principles of the international division of labor, leveraging technologies developed abroad and targeting foreign rather than domestic markets. Characteristics of this approach are illustrated using Raymond Vernon’s “life cycle” theory. The potential of both approaches is evaluated through the lens of the Soviet experience with import substitution. The study concludes that an import substitution model based on technological borrowing and export orientation not only achieves self-sufficiency but also generates additional economic benefits.
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