Introducing the Resource-Rich Caribbean Countries

As discussed in the preceding chapter, this study argues that the sustained economic development of resource-rich developing countries rests on the resident, resource-seeking MNE fostering backward and forward linkages in the resource sector of these countries. An examination of the extant literature reveals that this linkage creation is most likely to occur when governments implement industrial policies that increase their countries’ absorptive capacity, allowing them to capture the positive spillovers arising from the resource-seeking MNE’s activities. This study posits that the efficacy of these industrial policies is highly dependent on the institutional setting in which they are formulated and implemented. Its main thesis is that successful industrial policy making and implementation is done in institutional environments characterised by embedded autonomy. This is an institutional environment where a highly efficient and autonomous bifurcated bureaucracy is embedded with an entrepreneurial and capable private sector.