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Kicking Away the Ladder: Infant Industry Promotion in Historical Perspective 1

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  • Ha-Joon Chang

Abstract

This article introduces a new dimension in the debate on infant industry promotion by pointing out that, historically, the developed countries themselves did not develop on the basis of free trade policy and laissez-faire industrial policy that they currently recommend to, or even force upon, the developing countries. It first critically examines the "official history of capitalism", which sees the last few centuries as a continuous, if sometimes disrupted, advance of the free trade system. Then it shows how virtually all of today's developed countries, especially the UK and the USA, the supposed homes of free trade, used tariff protection and subsidies to develop their industries when they were in catching-up positions. It then criticizes the orthodox counter-argument that, while using protection in the early days of their economic development, today's developed countries never used it as much as today's developing countries have done. Finally, pointing out that the supposedly "good" policies of free trade and laissez-faire industrial policy have led to a collapse in growth in the developing countries during the last two decades, the article argues for a total rethink on trade policy and, more broadly, development strategy, for developing countries. Above all, it recommends that the global rules need to be rewritten in such a way that developing countries are allowed more actively to use tariffs and subsidies for infant industry promotion in accordance with their development strategy.

Suggested Citation

  • Ha-Joon Chang, 2003. "Kicking Away the Ladder: Infant Industry Promotion in Historical Perspective 1," Oxford Development Studies, Taylor & Francis Journals, vol. 31(1), pages 21-32.
  • Handle: RePEc:taf:oxdevs:v:31:y:2003:i:1:p:21-32
    DOI: 10.1080/1360081032000047168
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    1. List, Friedrich, 1885. "The National System of Political Economy," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number list1885.
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    Cited by:

    1. Olfert, R. & Berdegué, J. & Escobal, J. & Jara, B. & Modrego, F., 2011. "Places for Place-Based Policies," Working papers 079, Rimisp Latin American Center for Rural Development.
    2. Crafts, Nicholas, 2020. "British Relative Economic Decline in the Aftermath of German Unification," CAGE Online Working Paper Series 501, Competitive Advantage in the Global Economy (CAGE).
    3. Matt Andrews & Lant Pritchett & Michael Woolcock, 2015. "The Challenge of Building (Real) State Capability," CID Working Papers 306, Center for International Development at Harvard University.
    4. Wim Naudé, 2010. "Industrial Policy: Old and New Issues," WIDER Working Paper Series wp-2010-106, World Institute for Development Economic Research (UNU-WIDER).
    5. Matthew McCartney, 2014. "The Political Economy of Industrial Policy: A Comparative Study of the Textiles Industry in Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 19(Special E), pages 105-134, September.
    6. Barlow, Pepita & Loopstra, Rachel & Tarasuk, Valerie & Reeves, Aaron, 2020. "Liberal trade policy and food insecurity across the income distribution: an observational analysis in 132 countries, 2014–17," LSE Research Online Documents on Economics 105815, London School of Economics and Political Science, LSE Library.
    7. Sung-Ko Li & Chun-Kei Tsang, 2018. "The Impacts Of Biased Resource Allocation On The Effectiveness Of Official Development Assistance," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(01), pages 239-256, July.
    8. Tilman Altenburg & Wilfried Lütkenhorst, 2015. "Industrial Policy in Developing Countries," Books, Edward Elgar Publishing, number 14726, July.
    9. Szirmai, Adam, 2012. "Proximate, intermediate and ultimate causality: Theories and experiences of growth and development," MERIT Working Papers 2012-032, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    10. Andrews, Matt, 2013. "Do International Organizations Really Shape Government Solutions in Developing Countries?," Working Paper Series rwp13-032, Harvard University, John F. Kennedy School of Government.
    11. Uros Delevic & Irina Heim, 2017. "Institutions In Transition: Is The Eu Integration Process Relevant For Inward Fdi In Transition European Economies?," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 5(1), pages 16-32.

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