Final answer:
Countries can keep their products inexpensive for U.S. consumers by using strategies like import substitution to produce goods domestically, engaging in predatory pricing to temporarily undercut U.S. producers, and focusing on industries where they have a comparative advantage. Protectionist measures such as tariffs and quotas can also be used to support domestic industries at the expense of foreign competition.
Step-by-step explanation:
To keep its products inexpensive for consumers in the U.S., a country can deploy various strategies. One approach is the import substitution strategy, aiming to mimic industrialized nations and reduce dependency on imports by manufacturing goods domestically. However, this requires establishing high protective tariffs to shelter high-cost industries and does not necessarily benefit the abundance of unskilled labor in poorer countries.
Another tactic is predatory pricing, also known as dumping, where foreign firms sell goods below production cost temporarily, driving out domestic competition before raising prices. This practice is considered a form of protectionism and can be part of a larger trade strategy.
Countries can also leverage their comparative advantage by focusing on industries where they have lower opportunity costs, utilizing trade to swap these for goods that are cheaper to produce elsewhere. Additionally, protectionist measures such as tariffs, quotas, safety standards, and other tactics can be used to inhibit the flow of cheaper foreign goods to support domestic industries.