Machinery in Economic Development

In recent years there has been a renewed interest in the role of the machine-producing sector in economic development, as is evident from the growing number of articles published in this area and the research programmes undertaken by international organizations such as the ILO, UNCTAD and UNIDO. A number of factors account for the generation of new interest. Perhaps the most important is the increasing attention that has been given since the late 1970s to the role of technical change in improving the quantity and quality of national output. Advances in processes and products invariably require improved machinery. Accordingly, the machine-producing sector lies at the heart of the production and diffusion of technical change. A further reason for the new interest in this sector stems from the change in industrial structure that has occurred in many of the more industrialized developing countries. Partly as a result of policies intended to promote the growth of the machinery sector countries such as Brazil, Argentina, India, China, South Korea and Taiwan have become substantial producers, and in some cases exporters, of machinery. This change in industrial structure has prompted questions regarding the benefits provided by the machinery sector.