The Industrial Policy Revolution II: Africa in the 21st Century

627 Pages·2013·3.03 MB·English

by  Joseph E. Stiglitz

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Proceedings of the Eleventh World Congress of the International
Economic Association, Tunis
Edited by Ibrahim Elbadawi and Beno Ndula
International Economics Association
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The Industrial Policy
Revolution II
Africa in the 21st Century
Edited by
Joseph E. Stiglitz
University Professor, Columbia University, United States of America
Justin Lin Yifu
Honorary Dean, National School of Development, Peking University, China
and
Ebrahim Patel
Minister of Economic Development, South Africa
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Contents
List of Tables viii
List of Figures x
List of Boxes xiv
Notes on the Contributors xv
Foreword xxi
Acknowledgements xxvi
Introduction: Industrial Policy in the African Context 1
Joseph Stiglitz, Justin Yifu Lin, Célestin Monga, Ebrahim Patel
Part I New Thinking on Industrial Policy
1.1 Learning and Industrial Policy: Implications for Africa 25
Bruce Greenwald and Joseph E. Stiglitz
1.2 From Flying Geese to Leading Dragons: New Opportunities and
Strategies for Structural Transformation in Developing Countries 50
Justin Yifu Lin
Part II Structural Transformation: Lessons from History
2.1 Accumulation of Capabilities, Structural Change, and Macro
Prices: an Evolutionary and Structuralist Roadmap 73
Mario Cimoli and Gabriel Porcile
2.2 Industrial Policy: Can Africa Do It? 114
H a- Joon Chang
Part III New Global Order and African Reindustrialization
3.1 Winning the Jackpot: Jobs Dividends in a Multipolar World 135
Célestin Monga
3.2 Walking (Stumbling?) on Two Legs: Meeting SSA’s
Industrialization Challenge 173
Raphael Kaplinsky
Part IV Macroeconomics and Governance: Creating an
Enabling Environment
4.1 How Macroeconomic Policy Can Support Economic
Development in S ub- Saharan African Countries 201
James Heintz
v
vi Contents
4.2 Competition Policy, Industrial Policy, and Corporate Conduct 216
Simon Roberts
4.3 Political Settlements and the Design of Technology Policy 243
Mushtaq H. Khan
4.4 Infant Capitalists, Infant Industries and Infant Economies:
Trade and Industrial Policies at Early Stages of Industrialization
in Africa and Elsewhere 281
Akbar Noman
4.5 Industrial Policies and Contemporary Africa: The Transition
from Prebendal to Developmental Governance 293
Richard Joseph
Part V Trade, Finance, and Sectoral Policies
5.1 Does Financial Market Liberalization Promote Financial
Development?: Evidence from Sub- Saharan Africa 321
Hamid Rashid
5.2 Financialization as an Obstacle to Industrialization 350
C.P. Chandrasekhar
5.3 Toward a Resource-based African Industrialization Strategy 364
Paul Jourdan
5.4 The Global “Rush” for Land: Does it Provide Opportunities
for African Countries? 386
Klaus Deininger
5.5 Trade Facilitation and African Industrialization in
the New Global Order: An Agenda for the Textile and
Apparel Industry 412
Dominique Njinkeu, Julie Lohi, and Calvin Z. Djiofack
Part VI Country Experiences and Perspectives
6.1 Industrial Structural Change, Growth Patterns, and
Industrial Policy 457
Ludovico Alcorta, Nobuya Haraguchi, and Gorazd Rezonja
6.2 Industrial Policy and Economic Transformation in Africa:
Strategies for Development and a Research Agenda 492
Yaw Ansu
6.3 The Premature Deindustrialization of South Africa 529
Jean Imbs
6.4 How Ethiopia Can Foster a Light Manufacturing Sector 541
Vandana Chandra
Contents vii
6.5 Industrialization: The Mauritian Model 569
Streevarsen Pillay Narrainen
6.6 Sharing of Singapore’s Industrial Policy Insights 585
Thia Jang Ping
Index 590
List of Tables
1.2.1 Contribution of structural change: decomposition of labor
productivity growth, unweighted averages, 1 990– 2005 54
1.2.2 Global flows of foreign direct investment, 1990– 2009
(current prices and exchange rates) 57
1.2.3 The dragon in the global marketplace for low- tech
products: China’s percentage share of labor- intensive
exports, 1976– 2009 61
1.2.4 Comparing manufacturing in China with that in earlier
geese at similar levels of development 62
2.1.1 ICT impact 91
3.1.1 Average monthly wage including benefits, by industry
(US dollars) 156
3.2.1 GDP growth rates and numbers living below MDG1,
1990–2008 175
5.1.1 Dependent variable: real interest rate (%) 333
5.1.2 Dependable variable: real interest rate (%) 335
5.1.3 Dependent variable: domestic savings rate (% of GDP) 336
5.1.4 Dependent variable: gross domestic savings (% of GDP) 338
5.1.5 Dependent variable: interest rate spread 340
5.1.6 Dependent variable: interest rate spread 341
5.1.7 Dependent variable: domestic credit
to private sector (% of GDP) 343
5.1.8 Dependent variable: domestic credit to
private sector (% of GDP) 344
5.4.1 Land use and non−forested, non−protected agriculturally
suitable area by region and key countries 395
5.4.2 Extent of large land acquisitions in selected
countries, 2004–2009 400
5.4.3 Probability that a country is targeted by investors 402
5.4.4 Poisson regressions for the number of projects
in bilateral investment relations 403
5.5.1 Average shares of manufactures in GDP and export
for regions and selected countries 416
viii
List of Tables ix
5.5.2 Regional Logistics Performance Index 424
5.5.3 Logistics performance and efficiency of customs clearance
process: selected African and Asian countries 424
5.5.4 Gravity model applied on total exports (except oil) for
developing countries 427
5.5.5 Gravity model applied on textile exports only for developing
countries 430
5.5.6 Regional integration and trade facilitation to boost
African textile exports 433
5.5.7 Increase in Africa’s textile exports under AGOA
(measures in tons) 434
5.5.8 The Impacts of preferential trade agreements
on developing countries’ trade 440
5.5.9 Trade within subregional customs unions and their
sensitivity to the LPI 442
5.5.10 The impacts of tariffs on developing countries’ trade 444
5.5.11 Trade policies with Africa and their sensitivity to the LPI 445
6.1.1 Industries’ peak share 467
6.2.1 Economic transformation indicators (SSA, ACET-15 & COMP) 497
6.4.1 To be a modern economy, Ethiopia must industrialize 543
6.4.2 Excess local demand for light manufactures in Ethiopia 549
6.4.3 Ethiopia’s labor cost advantage over China and Vietnam 550
6.4.4 Ethiopia can compete: labor productivity in leather
and garments 551
6.4.5 Ethiopia exports many domestic inputs and raw materials 552
6.4.6 Ethiopian costs as a share of China’s cost of production (%) 554
6.4.7 Comparison of trade logistics costs (US dollars) per 20 foot
container 556
6.4.8 Comparison of input prices in Ethiopia, China and Vietnam
(US dollars) 557
6.4.9 Ethiopia: Technical efficiency of leather shoe production 561