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From Imitation to Innovation : Public Policy for Industrial Transformation

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  • Pierre-Richard Agénor
  • Hinh T. Dinh

Abstract

What role does public policy play in helping countries accelerate the industrialization process? This note aims to answer this question by applying a framework to analyze the process of transitioning from imitation to innovation. Based on a dynamic model of growth, simulations suggest that learning through imitation may enable firms to improve productivity significantly in a first stage, and that this may eventually benefit innovation activity as well. The model also shows how failure to switch from imitation as the main source of productivity growth to broad-based, homegrown innovation could lead to the “middle-income trap” that has befallen some countries.
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Suggested Citation

  • Pierre-Richard Agénor & Hinh T. Dinh, 2013. "From Imitation to Innovation : Public Policy for Industrial Transformation," World Bank Publications - Reports 17024, The World Bank Group.
  • Handle: RePEc:wbk:wboper:17024
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    References listed on IDEAS

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    1. Agenor, Pierre-Richard & Dinh, Hinh T., 2013. "Public policy and industrial transformation in the process of development," Policy Research Working Paper Series 6405, The World Bank.
    2. Harrison, Ann & Rodríguez-Clare, Andrés, 2010. "Trade, Foreign Investment, and Industrial Policy for Developing Countries," Handbook of Development Economics, in: Dani Rodrik & Mark Rosenzweig (ed.), Handbook of Development Economics, edition 1, volume 5, chapter 0, pages 4039-4214, Elsevier.
    3. Agenor, Pierre-Richard & Dinh, Hinh, 2013. "From Imitation to Innovation: Public Policy for Industrial Transformation," World Bank - Economic Premise, The World Bank, issue 115, pages 1-8, May.
    4. Alwyn Young, 2012. "The African Growth Miracle," NBER Working Papers 18490, National Bureau of Economic Research, Inc.
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    6. Vivien Foster & Cecilia Briceno-Garmendia, 2010. "Africa's Infrastructure : A Time for Transformation [Infrastructures africaines]," World Bank Publications - Books, The World Bank Group, number 2692, December.
    7. Marcus Noland & Howard Pack, 2003. "Industrial Policy in an Era of Globalization: Lessons from Asia," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 358, October.
    8. repec:unu:wpaper:unupb2-2013 is not listed on IDEAS
    9. Eifert, Benn & Gelb, Alan & Ramachandran, Vijaya, 2008. "The Cost of Doing Business in Africa: Evidence from Enterprise Survey Data," World Development, Elsevier, vol. 36(9), pages 1531-1546, September.
    10. Pierre-Richard Agénor & Otaviano Canuto & Michael Jelenic, 2012. "Avoiding Middle-Income Growth Traps," World Bank - Economic Premise, The World Bank, issue 98, pages 1-7, November.
    11. Howard Pack & Kamal Saggi, 2006. "Is There a Case for Industrial Policy? A Critical Survey," The World Bank Research Observer, World Bank Group, vol. 21(2), pages 267-297.
    12. Alwyn Young, 2012. "The African Growth Miracle," Journal of Political Economy, University of Chicago Press, vol. 120(4), pages 696-739.
    13. Hinh T. Dinh & George R.G. Clarke, 2012. "Performance of Manufacturing Firms in Africa : An Empirical Analysis," World Bank Publications - Books, The World Bank Group, number 11959, December.
    14. Andersen, Thomas Barnebeck & Dalgaard, Carl-Johan, 2013. "Power outages and economic growth in Africa," Energy Economics, Elsevier, vol. 38(C), pages 19-23.
    15. Justin Yifu Lin, 2014. "Prologue," Introductory Chapters, in: The Quest for Prosperity: How Developing Economies Can Take Off, With a new preface by the author, Princeton University Press.
    16. Hinh T. Dinh & Vincent Palmade & Vandana Chandra & Frances Cossar, 2012. "Light Manufacturing in Africa : Targeted Policies to Enhance Private Investment and Create Jobs [L’industrie légère en Afrique : Politiques ciblées pour susciter l’investissement privé et créer des," World Bank Publications - Books, The World Bank Group, number 2245, December.
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    Citations

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    Cited by:

    1. Sun, Yajie & Liao, Wen-Chi, 2021. "Resource-Exhausted City Transition to continue industrial development," China Economic Review, Elsevier, vol. 67(C).
    2. Glawe, Linda & Wagner, Helmut, 2020. "China in the middle-income trap?," China Economic Review, Elsevier, vol. 60(C).
    3. Pierre‐Richard Agénor & Barış Alpaslan, 2018. "Infrastructure And Industrial Development With Endogenous Skill Acquisition," Bulletin of Economic Research, Wiley Blackwell, vol. 70(4), pages 313-334, October.
    4. Ching T. Liao, 2022. "Skill improvement by product imitation," Small Business Economics, Springer, vol. 58(3), pages 1563-1577, March.
    5. Agénor, Pierre-Richard & Dinh, Hinh T., 2015. "Social capital, product imitation and growth with learning externalities," Journal of Development Economics, Elsevier, vol. 114(C), pages 41-54.
    6. Agenor, Pierre-Richard & Dinh, Hinh, 2013. "From Imitation to Innovation: Public Policy for Industrial Transformation," World Bank - Economic Premise, The World Bank, issue 115, pages 1-8, May.
    7. Hinh T. Dinh, 2017. "Jobs, Industrialization, and Globalization," Books & Reports, Policy Center for the New South, number 16, April.
    8. Pierre-Richard Agénor & Karim El Aynaoui, 2014. "Politiques Publiques, Transformation Industrielle, Croissance et Emploi au Maroc : Une Analyse Quantitative [Public Policy, Industrial Transformation, Growth and Employment in Morocco: A Quantitative ," Research papers & Policy papers 1403, Policy Center for the New South.
    9. Riana Razafimandimby Andrianjaka & Eric Rougier, 2017. "What difference does it make? Revue de littérature et analyse empirique des déterminants de la Trappe à Revenu Intermédiaire," Cahiers du GREThA (2007-2019) 2017-16, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).

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    More about this item

    Keywords

    Private Sector Development - E-Business Social Protections and Labor - Labor Policies Social Protections and Labor - Labor Markets Finance and Financial Sector Development - Debt Markets Economic Theory and Research Macroeconomics and Economic Growth;

    JEL classification:

    • O0 - Economic Development, Innovation, Technological Change, and Growth - - General
    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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