ABSTRACT
In January 2011, the Folha de Sao Paulo newspaper in Brazil reported that Petrobras—the state-owned international oil company—might consider reducing its expenditure on locally produced content in the supply of goods and services from 65% to 35%. The term protectionism refers to the intended or unintended economic policy of restraining trade between countries through methods such as tariffs (taxes) on imported goods, or restrictive import quotas and regulations designed to discourage imports. The infant industry argument was first espoused by Alexander Hamilton, a Founding Father of the United States and Secretary of the Treasury. Double market failure is the failure of government interventions to correct failures in the free market. The combination of public policy and strategic procurement by BP can be considered a successful market intervention. Over time, as productivity in the fabrication yard improved, the premiums for subsequent platforms were able to be reduced.
