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Principles of True Industrial Policy

Author

Listed:
  • Cherif Reda
  • Hasanov Fuad

    (International Monetary Fund, Georgetown University, Washington, DC, United States of America)

Abstract

Industrial policy is tainted with bad reputation among policymakers and academics and is often viewed as the road to perdition for developing economies. Yet the success of the Asian Miracles with industrial policy stands as an uncomfortable story that many ignore or claim it cannot be replicated. We argue that one can learn from these miracles and we suggest that three key principles were behind their success: (i) the support of domestic producers in sophisticated industries, beyond the initial comparative advantage; (ii) export orientation; and (iii) the pursuit of fierce competition with strict accountability.

Suggested Citation

  • Cherif Reda & Hasanov Fuad, 2019. "Principles of True Industrial Policy," Journal of Globalization and Development, De Gruyter, vol. 10(1), pages 1-22, June.
    • Handle: RePEc:bpj:globdv:v:10:y:2019:i:1:p:22:n:2
    DOI: 10.1515/jgd-2019-0034
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    More about this item

    Keywords

    diversification; growth; industrial policy; innovation; technology;
    All these keywords.

    JEL classification:

    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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