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Industrial Policy - How to Choose Industries that Should Be Supported


  • Popov, V.

    (Russian Presidential Academy of National Economy and Public Administration (RANEPA), Moscow, Russia
    New Economic School (NES), Moscow, Russia)


Sometimes industrial police is a success story, but sometimes it is a total failure. It seems like the best results are achieved in countries that (1) support industries oriented not only towards import substitution, but also towards export, at least in the longer run, and (2) support not all exports, but only exports of products that are associated with greatest externalities, emerging when returns for the whole society are larger than returns for particular exporting companies. As a rule, these are secondary manufacturing and high-tech industries. The ways to select industries that should be supported are discussed in the paper.

Suggested Citation

  • Popov, V., 2014. "Industrial Policy - How to Choose Industries that Should Be Supported," Journal of the New Economic Association, New Economic Association, vol. 22(2), pages 186-190.
  • Handle: RePEc:nea:journl:y:2014:i:22:p:186-190

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    References listed on IDEAS

    1. Hausmann, Ricardo & Rodrik, Dani, 2003. "Economic development as self-discovery," Journal of Development Economics, Elsevier, vol. 72(2), pages 603-633, December.
    2. Dani Rodrik, 2006. "What's So Special about China's Exports?," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 14(5), pages 1-19.
    3. Ricardo Hausmann & Jason Hwang & Dani Rodrik, 2007. "What you export matters," Journal of Economic Growth, Springer, vol. 12(1), pages 1-25, March.
    4. Yevgeniya Shevtsova, 2012. "International Trade and Productivity: Does Destination Matter?," Discussion Papers 12/18, Department of Economics, University of York.
    5. Popov, V., 2014. "An Economic Miracle in the Post-Soviet Space: How Uzbekistan Managed to Achieve What No Other Post-Soviet State Has," Journal of the New Economic Association, New Economic Association, vol. 21(1), pages 136-159.
    6. Lee,Keun, 2013. "Schumpeterian Analysis of Economic Catch-up," Cambridge Books, Cambridge University Press, number 9781107042681, August.
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    Cited by:

    1. Polterovich, V., 2014. "Industrial Policy: Recipes or Institutions?," Journal of the New Economic Association, New Economic Association, vol. 22(2), pages 190-195.

    More about this item


    industrial policy; industrial structure; import substitutions; export orientation; diversification of exports;

    JEL classification:

    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy


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