Question

Suppose you're in charge of establishing economic policy for this small island country.Which of the following policies would lead to greater productivity in the weaving industry? Check all that apply.Offering free public education to every worker in the country. Subsidizing research and development into new weaving technologies. Imposing restrictions on foreign ownership of domestic capitalImposing a tax on looms.

Answer 1

Answer:

The correct answer is Subsidizing research and development into new weaving technologies.

Explanation:

Human capital and investment in Research and Development are considered the two main drivers of productivity accross nations. The weaving industry is labor-intensive, but does not require highly qualified workforce, thus, an economic policy focused on education might not have a direct impact on productivity. Investing on R&D might be a better policy since it might lead to improving production techniques and increased productivity in the long term.