What factors drive successful industrialization? Evidence and implications for developing countries

N. Haraguchi, B. Martorano, M. Sanfilippo

    Research output: Contribution to journalArticleAcademicpeer-review

    Abstract

    This paper analyses the drivers of successful industrialization in developing countries. We consider two different periods, 1970-1990 and 1991-2014, likely to be affected by different patterns of industrialization due to major political, technological and organizational changes. We subsequently develop a methodology to identify a small group of countries for each period, which have exhibited a pattern of industrialization that is not only remarkable in absolute terms, but also sustained. Our analysis reveals that successful industrialization is driven by a combination of factors, including a country's initial economic conditions, factor endowments and other characteristics, such as demography and geography. We also show that other variables that policymakers can control play a crucial role. This includes, among others, the promotion of investments (both public and privately funded) and education; the management of trade and capital openness; financial sector development and the promotion of both macroeconomic and institutional stability. 

    Original languageEnglish
    Pages (from-to)266-276
    Number of pages11
    JournalStructural Change and Economic Dynamics
    Volume49
    DOIs
    Publication statusPublished - Jun 2019

    JEL classifications

    • o14 - "Industrialization; Manufacturing and Service Industries; Choice of Technology"
    • o00 - Economic Development, Technological Change, and Growth

    Keywords

    • Developing countries
    • Industrialization
    • Policies
    • STRUCTURAL-CHANGE
    • PATTERNS
    • ECONOMIC-GROWTH
    • industrialization
    • DEPENDENCE

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