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Emulation versus Comparative Advantage: Competing and Complementary Principles in the History of Economic Policy

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  • Erik S. Reinert

Abstract

The objective of this chapter is to show how economic policies based on completely different principles - one described as 'emulation' and the other as 'comparative advantage' - have been strategically employed in order to achieve economic development when nations have made the transition from poor to wealthy. It also briefly describes key aspects of the process by which Europe, through emulation, developed from a collection of fief- doms ruled by warlords into city-states and later to nation-states. It is argued that the timing of the strategic shift from emulation to comparative advantage is of utmost importance to a nation. Making this policy shift too early will hamper development much as a late shift will do. It is argued that these principles, although sometimes under different names, were well known and employed by European nations from the seventeenth century onwards.in the United States all the way to the end of the nineteenth cen- tury.and that the Marshall Plan implemented more than 60 years ago owed its success to putting the principle of emulation chronologically ahead of comparative advantage.

Suggested Citation

  • Erik S. Reinert, 2009. "Emulation versus Comparative Advantage: Competing and Complementary Principles in the History of Economic Policy," The Other Canon Foundation and Tallinn University of Technology Working Papers in Technology Governance and Economic Dynamics 25, TUT Ragnar Nurkse School of Innovation and Governance.
  • Handle: RePEc:tth:wpaper:25
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. What Can We Learn from Alternative Theories of Economic Development?
      by Ingrid Harvold Kvangraven in Development Economics on 2017-01-29 21:17:34

    Citations

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    Cited by:

    1. Gerhard Hanappi, 2012. "Schumpeter," Chapters,in: Handbook on the Economics and Theory of the Firm, chapter 6 Edward Elgar Publishing.
    2. repec:pje:journl:articlev is not listed on IDEAS
    3. Michele Di Maio, 2008. "Industrial Policies in Developing Countries: History and Perspectives," Working Papers 48-2008, Macerata University, Department of Finance and Economic Sciences, revised Oct 2008.
    4. Florian Schaefer & Girum Abebe, 2015. "The case for industrial policy and its application in the Ethiopian cut flower sector," Working Papers 012, Ethiopian Development Research Institute.
    5. Rainer Kattel & Leonardo Burlamaqui, 2016. "Development Theory: Convercence, Catch-Up Or Leapfrogging And Finance ?," Anais do XLII Encontro Nacional de Economia [Proceedings of the 42ndd Brazilian Economics Meeting] 073, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
    6. Salam Alshareef, 2015. "Patent regulation in North-South and South-South Trade Agreements," Post-Print halshs-01273156, HAL.
    7. Mario Cimoli & Giovanni Dosi & Joseph E. Stiglitz, 2008. "The Future of Industrial Policies in the New Millennium: Toward a Knowledge-Centered Development Agenda," LEM Papers Series 2008/19, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    8. Mulatu, Abay, 2016. "On the concept of 'competitiveness' and its usefulness for policy," Structural Change and Economic Dynamics, Elsevier, vol. 36(C), pages 50-62.
    9. Erik S. Reinert, 2009. "The Terrible Simplifers: Common Origins of Financial Crises and Persistent Poverty in Economic Theory and the new ‘1848 Moment’," Working Papers 88, United Nations, Department of Economics and Social Affairs.
    10. Dosi, Giovanni & Grazzi, Marco & Moschella, Daniele, 2015. "Technology and costs in international competitiveness: From countries and sectors to firms," Research Policy, Elsevier, vol. 44(10), pages 1795-1814.
    11. Devlin, Robert & Moguillansky, Graciela, 2012. "What's new in the new industrial policy in Latin America ?," Policy Research Working Paper Series 6191, The World Bank.
    12. Usman Qadir, 2016. "Pakistan’s Automotive Industry: A Case of Stalled Development," PIDE-Working Papers 2016:137, Pakistan Institute of Development Economics.

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