“A country whose trade has almost no impact on world prices is at great risk of immiserizing growth.” Do you agree or disagree? Why?
Disagree. Immiserizing growth can occur if growth in the country leads the country to want to trade more, and the country’s terms of trade deteriorate by a large amount. If a country’s trade has almost no impact on world prices, then its growth will have almost no impact on its terms of trade, and immiserizing growth is very unlikely.