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The Speed of Structural Convergence in the Manufacturing Industries of Newly Industrializing Economies

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Author Info
Berhanu Abegaz () (Department of Economics, College of William and Mary)
Abstract

We seek to identify the determinants of the speed of convergence in the structures of manufacturing to their steady-state levels as developing economies become fully industrialized. Applying a two-stage sequential estimation procedure to data on three-digit manufacturing industries for 45 mostly middle-income countries, we find empirical support for the hypothesis that production efficiency is a major determinant of inter-branch output share adjustment. This finding applies to many but not all industries. One implication for latecomers is that industrial policy must aim at rapid diffusion of core technologies to facilitate the acquisition of industrial capabilities in a diversified basket of exportables.

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Paper provided by Department of Economics, College of William and Mary in its series Working Papers with number 67.

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Length: 29 pages
Date of creation: 07 Dec 2007
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Handle: RePEc:cwm:wpaper:67

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Related research
Keywords: industrialization structural convergence speed of convergence manufacturing diversification

Find related papers by JEL classification:
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
L6 - Industrial Organization - - Industry Studies: Manufacturing
O14 - Economic Development, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes
O57 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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  1. James R. Tybout, 2000. "Manufacturing Firms in Developing Countries: How Well Do They Do, and Why?," Journal of Economic Literature, American Economic Association, vol. 38(1), pages 11-44, March. [Downloadable!] (restricted)
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    Other versions:
  4. Trevor A. Reeve, 2006. "Factor Endowments and Industrial Structure," Review of International Economics, Blackwell Publishing, vol. 14(1), pages 30-53, 02. [Downloadable!] (restricted)
  5. Francesco Caselli & Silvana Tenreyro, 2005. "Is Poland the Next Spain?," NBER Working Papers 11045, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Giuliani, Elisa & Pietrobelli, Carlo & Rabellotti, Roberta, 2005. "Upgrading in Global Value Chains: Lessons from Latin American Clusters," World Development, Elsevier, vol. 33(4), pages 549-573, April. [Downloadable!] (restricted)
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  7. Klinger, Bailey & Lederman, Daniel, 2004. "Discovery and development : an empricial exploration of"new"products," Policy Research Working Paper Series 3450, The World Bank. [Downloadable!]
  8. Berhanu Abegaz, 2002. "Structural convergence in manufacturing industries between leaders and latecomers," The Journal of Development Studies, Taylor and Francis Journals, vol. 38(4), pages 69-99, April. [Downloadable!] (restricted)
  9. Jean Imbs & Romain Wacziarg, 2003. "Stages of Diversification," American Economic Review, American Economic Association, vol. 93(1), pages 63-86, March. [Downloadable!] (restricted)
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  10. Timmer, Marcel P. & Szirmai, Adam, 2000. "Productivity growth in Asian manufacturing: the structural bonus hypothesis examined," Structural Change and Economic Dynamics, Elsevier, vol. 11(4), pages 371-392, December. [Downloadable!] (restricted)
  11. Mario Cimoli & Giovanni Dosi & Richard R. Nelson & Joseph Stiglitz, 2006. "Institutions and Policies Shaping Industrial Development: An Introductory Note," LEM Papers Series 2006/02, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy. [Downloadable!]
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  13. Gereffi, Gary, 1999. "International trade and industrial upgrading in the apparel commodity chain," Journal of International Economics, Elsevier, vol. 48(1), pages 37-70, June. [Downloadable!] (restricted)
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