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Selective Industrial and Trade Policies in Developing Countries: Theoretical and Empirical Issues

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Sanjaya Lall

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Abstract

This paper analyses the case for selective industrial and trade policies in Africa, drawing upon the lessons of East Asia. It reviews the theoretical arguments for government intervention in the context of technological learning, and relates this to the new environment of rapid technical change and globalisation of production. It also considers the risks of government failure in mounting selective policies, and concludes that the degree of selectivity has to be much less than in East Asia. The case for selective policies nevertheless remains strong, if Africa is to make any industrial progress.

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Paper provided by Queen Elizabeth House, University of Oxford in its series QEH Working Papers with number qehwps48.

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Handle: RePEc:qeh:qehwps:qehwps48

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  1. Biggs, T. & Shah, M. & Srivastava, P., 1995. "Technological Capabilities and Learning in African Enterprises," Papers 288, World Bank - Technical Papers.
  2. Pack, Howard, 1993. "Productivity and industrial development in sub-Saharan Africa," World Development, Elsevier, vol. 21(1), pages 1-16, January. [Downloadable!] (restricted)
  3. Lall, Sanjaya, 1998. "Exports of Manufactures by Developing Countries: Emerging Patterns of Trade and Location," Oxford Review of Economic Policy, Oxford University Press, vol. 14(2), pages 54-73, Summer.
  4. Rodrik, Dani, 1996. "Coordination failures and government policy: A model with applications to East Asia and Eastern Europe," Journal of International Economics, Elsevier, vol. 40(1-2), pages 1-22, February. [Downloadable!] (restricted)
  5. Stein, Howard, 1992. "Deindustrialization, adjustment, the World Bank and the IMF in Africa," World Development, Elsevier, vol. 20(1), pages 83-95, January. [Downloadable!] (restricted)
  6. Richard R. Nelson, 1995. "Recent Evolutionary Theorizing about Economic Change," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 48-90, March. [Downloadable!] (restricted)
  7. Lall, Sanjaya, 1994. "The East Asian miracle: Does the bell toll for industrial strategy?," World Development, Elsevier, vol. 22(4), pages 645-654, April. [Downloadable!] (restricted)
  8. Pack, Howard & Westphal, Larry E., 1986. "Industrial strategy and technological change : Theory versus reality," Journal of Development Economics, Elsevier, vol. 22(1), pages 87-128, June. [Downloadable!] (restricted)
  9. Dahlman, Carl J. & Ross-Larson, Bruce & Westphal, Larry E., 1987. "Managing technological development: Lessons from the newly industrializing countries," World Development, Elsevier, vol. 15(6), pages 759-775, June. [Downloadable!] (restricted)
  10. Lall, Sanjaya, 1992. "Technological capabilities and industrialization," World Development, Elsevier, vol. 20(2), pages 165-186, February. [Downloadable!] (restricted)
  11. Stiglitz, Joseph E, 1989. "Markets, Market Failures, and Development," American Economic Review, American Economic Association, vol. 79(2), pages 197-203, May. [Downloadable!] (restricted)
  12. Stiglitz, Joseph E, 1996. "Some Lessons from the East Asian Miracle," World Bank Research Observer, Oxford University Press, vol. 11(2), pages 151-77, August.
  13. Dani Rodrik, 1988. "Closing the Technology Gap: Does Trade Liberalization Really Help?," NBER Working Papers 2654, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  14. Lall, Sanjaya & Teubal, Morris, 1998. ""Market-stimulating" technology policies in developing countries: A framework with examples from East Asia," World Development, Elsevier, vol. 26(8), pages 1369-1385, August. [Downloadable!] (restricted)
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