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Industrial clusters: The case for Special Economic Zones in Africa

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  • Carol Newman
  • John Page

Abstract

Firms tend to cluster in close geographic proximity to each other to benefit from reduced transport costs, shared inputs, and productivity spillovers due to learning and technology transfers. Evidence from low-income countries suggests that such agglomeration economies may be substantial in endogenously formed clusters. This raises the question of whether spatial industrial policies can be designed to facilitate clustering. In this paper, we consider the case for creating Special Economic Zones (SEZs) in Africa. We document at the country level the state of current SEZ programmes and the policy measures in place for their promotion. We give an overview of the evidence on their success and provide a set of policy recommendations to improve SEZs performance.

Suggested Citation

  • Carol Newman & John Page, 2017. "Industrial clusters: The case for Special Economic Zones in Africa," WIDER Working Paper Series 015, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:wp2017-15
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    File URL: https://www.wider.unu.edu/sites/default/files/wp2017-15.pdf
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    References listed on IDEAS

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    1. Miyagiwa, Kaz F., 1986. "A reconsideration of the welfare economics of a free-trade zone," Journal of International Economics, Elsevier, vol. 21(3-4), pages 337-350, November.
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    4. Chhair, Sokty & Newman, Carol, 2014. "Clustering, competition, and spillover effects: Evidence from Cambodia," WIDER Working Paper Series 065, World Institute for Development Economic Research (UNU-WIDER).
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    6. Bigsten, Arne & Gebreeyesus, Mulu & Siba, Eyerusalem & Soderbom, Måns, 2012. "Enterprise Agglomeration, Output Prices, and Physical Productivity: Firm-Level Evidence from Ethiopia," WIDER Working Paper Series 085, World Institute for Development Economic Research (UNU-WIDER).
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    8. Sutton, John, 2012. "Competing in Capabilities: The Globalization Process," OUP Catalogue, Oxford University Press, number 9780199274536.
    9. Hamada, Koichi, 1974. "An economic analysis of the duty-free zone," Journal of International Economics, Elsevier, vol. 4(3), pages 225-241, August.
    10. Abel Kinyondo & Carol Newman & Finn Tarp, 2016. "The role and effectiveness of Special Economic Zones in Tanzania," WIDER Working Paper Series 122, World Institute for Development Economic Research (UNU-WIDER).
    11. World Bank, 2009. "Geography in Motion: World Development Report 2009 (excerpt)," Transnational Corporations Review, Ottawa United Learning Academy, vol. 1(3), pages 40-46, September.
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    13. Howard, Emma & Newman, Carol & Rand, John & Tarp, Finn, 2014. "Productivity-enhancing manufacturing clusters: Evidence from Vietnam," WIDER Working Paper Series 071, World Institute for Development Economic Research (UNU-WIDER).
    14. Ayadi, Mohamed & Mattoussi, Wided, 2014. "Disentangling the pattern of geographic concentration in Tunisian manufacturing industries," WIDER Working Paper Series 072, World Institute for Development Economic Research (UNU-WIDER).
    15. Emma Howard & Carol Newman & Finn Tarp, 2016. "Measuring industry coagglomeration and identifying the driving forces," Journal of Economic Geography, Oxford University Press, vol. 16(5), pages 1055-1078.
    16. Chete, L. N. & Adeoti, J. O. & Adeyinka, F. M. & Ogundele, O., 2014. "Industrial development and growth in Nigeria: Lessons and challenges," WIDER Working Paper Series 019, World Institute for Development Economic Research (UNU-WIDER).
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    18. Thomas Farole, 2011. "Special Economic Zones in Africa : Comparing Performance and Learning from Global Experience," World Bank Publications, The World Bank, number 2268.
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    21. repec:unu:wpaper:wp2012-85 is not listed on IDEAS
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    Cited by:

    1. Athukorala, Prema-chandra & Narayanan, Suresh, 2017. "Economic Corridors and Regional Development: The Malaysian Experience," ADB Economics Working Paper Series 520, Asian Development Bank.
    2. Abel Kinyondo & Carol Newman & Finn Tarp, 2016. "The role and effectiveness of Special Economic Zones in Tanzania," WIDER Working Paper Series 122, World Institute for Development Economic Research (UNU-WIDER).
    3. Athukorala, Prema-chandra & Narayanan, Suresh, 2018. "Economic corridors and regional development: The Malaysian experience," World Development, Elsevier, vol. 106(C), pages 1-14.

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    Keywords

    agglomeration; Special Economic Zones; spatial industrial policy; Africa;

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