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Strategy for Cluster-Based Industrial Development in Developing Countries

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  • Keijiro Otsuka

    (Graduate School of Economics, Kobe University)

Abstract

Discussions on industrial policy are back on the scene primarily because of the failure of the Washington Consensus as a development strategy. Having emerged is a new consensus that the industrial policy should address market failures while pursuing comparative advantage. However, it is unclear where markets fail, how market failures can be corrected, and whether governments can identify them. In the literature, credit provision, management training, and information externalities arising from industrial clusters and foreign direct investment are discussed separately as means to promote industrial development. This study proposes a strategy for cluster-based industrial development based on a comprehensive review of the relevant literature.

Suggested Citation

  • Keijiro Otsuka, 2020. "Strategy for Cluster-Based Industrial Development in Developing Countries," Discussion Papers 2019, Graduate School of Economics, Kobe University.
    • Handle: RePEc:koe:wpaper:2019
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    File URL: http://www.econ.kobe-u.ac.jp/RePEc/koe/wpaper/2020/2019.pdf
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