Growth Identification and Facilitation : The Role of the State in the Dynamics of Structural Change

Lin, Justin Yifu; Monga, Celestin

dc.creator	Lin, Justin Yifu
dc.creator	Monga, Celestin
dc.date	2012-03-19T18:40:00Z
dc.date	2012-03-19T18:40:00Z
dc.date	2010-05-01
dc.date.accessioned	2023-02-17T21:03:45Z
dc.date.available	2023-02-17T21:03:45Z
dc.identifier	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100518154747
dc.identifier	http://hdl.handle.net/10986/3798
dc.identifier.uri	http://localhost:8080/xmlui/handle/CUHPOERS/244762
dc.description	Active economic policies by developing countries governments to promote growth and industrialization have generally been viewed with suspicion by economists, and for good reasons: past experiences show that such policies have too often failed to achieve their stated objectives. But the historical record also indicates that in all successful economies, the state has always played an important role in facilitating structural change and helping the private sector sustain it across time. This paper proposes a new approach to help policymakers in developing countries identify those industries that may hold latent comparative advantage. It also recommends ways of removing binding constraints to facilitate private firms entry into those industries. The paper introduces an important distinction between two types of government interventions. First are policies that facilitate structural change by overcoming information and coordination and externality issues, which are intrinsic to industrial upgrading and diversification. Such interventions aim to provide information, compensate for externalities, and coordinate improvements in the "hard" and "soft" infrastructure that are needed for the private sector to grow in sync with the dynamic change in the economy s comparative advantage. Second are those policies aimed at protecting some selected firms and industries that defy the comparative advantage determined by the existing endowment structure either in new sectors that are too advanced or in old sectors that have lost comparative advantage.
dc.language	English
dc.relation	Policy Research working paper ; no. WPS 5313
dc.rights	CC BY 3.0 IGO
dc.rights	http://creativecommons.org/licenses/by/3.0/igo/
dc.rights	World Bank
dc.subject	ADVANCED COUNTRIES
dc.subject	ADVANCED ECONOMIES
dc.subject	AGGREGATE LEVEL
dc.subject	AGRICULTURE
dc.subject	BENCHMARK
dc.subject	BINDING CONSTRAINTS
dc.subject	BUSINESS DEVELOPMENT
dc.subject	CAPITAL ACCUMULATION
dc.subject	CAPITAL GOODS
dc.subject	CAPITAL INTENSITY
dc.subject	CAPITAL INVESTMENT
dc.subject	CARBON
dc.subject	CHEMICAL FERTILIZERS
dc.subject	COAL
dc.subject	COMMUNICATION TECHNOLOGIES
dc.subject	COMPARATIVE ADVANTAGE
dc.subject	COMPARATIVE ADVANTAGES
dc.subject	COMPETITIVE MARKET
dc.subject	COMPETITIVE MARKETS
dc.subject	COMPETITIVENESS
dc.subject	COST OF CAPITAL
dc.subject	COUNTRY REGRESSIONS
dc.subject	CROSS-COUNTRY PERSPECTIVE
dc.subject	DEBT
dc.subject	DECISION TREE
dc.subject	DEVELOPED COUNTRIES
dc.subject	DEVELOPING COUNTRIES
dc.subject	DEVELOPING COUNTRY
dc.subject	DEVELOPING WORLD
dc.subject	DEVELOPMENT AGENCIES
dc.subject	DEVELOPMENT ECONOMICS
dc.subject	DEVELOPMENT POLICY
dc.subject	DEVELOPMENT STRATEGIES
dc.subject	DEVELOPMENT STRATEGY
dc.subject	DISEQUILIBRIUM
dc.subject	DIVERSIFICATION
dc.subject	DOMESTIC INDUSTRIES
dc.subject	DOMESTIC SAVINGS
dc.subject	ECONOMETRIC MODELING
dc.subject	ECONOMIC CHANGE
dc.subject	ECONOMIC CRITERIA
dc.subject	ECONOMIC DEVELOPMENT
dc.subject	ECONOMIC DEVELOPMENTS
dc.subject	ECONOMIC EFFECTS
dc.subject	ECONOMIC GROWTH
dc.subject	ECONOMIC HISTORIANS
dc.subject	ECONOMIC IMPACT
dc.subject	ECONOMIC POLICIES
dc.subject	ECONOMIC POWERHOUSES
dc.subject	ECONOMIC PROGRAMS
dc.subject	ECONOMIC SECTORS
dc.subject	ECONOMIC THEORY
dc.subject	ECONOMIES OF SCALE
dc.subject	ECONOMISTS
dc.subject	EFFICIENT MARKET
dc.subject	EFFICIENT MARKETS
dc.subject	ELASTICITY
dc.subject	EMERGING MARKET
dc.subject	EMERGING MARKET ECONOMIES
dc.subject	EMPIRICAL EVIDENCE
dc.subject	EMPIRICAL STUDIES
dc.subject	ENVIRONMENTAL
dc.subject	ENVIRONMENTAL PROTECTION
dc.subject	EXCHANGE RATE
dc.subject	EXPORT PROMOTION
dc.subject	EXPORTS
dc.subject	EXTERNALITIES
dc.subject	EXTERNALITY
dc.subject	FACTOR ENDOWMENTS
dc.subject	FACTOR PRICES
dc.subject	FACTORS OF PRODUCTION
dc.subject	FAILURE OF STATE
dc.subject	FINANCE CORPORATION
dc.subject	FINANCIAL MARKETS
dc.subject	FINANCIAL SUPPORT
dc.subject	FINANCIAL SYSTEM
dc.subject	FISHING
dc.subject	FOREIGN EXCHANGE
dc.subject	FOREIGN FIRMS
dc.subject	FORESTRY
dc.subject	FREE TRADE
dc.subject	FULL EMPLOYMENT
dc.subject	FUTURE GROWTH
dc.subject	GDP
dc.subject	GOVERNMENT ACTION
dc.subject	GOVERNMENT INTERVENTION
dc.subject	GOVERNMENT INTERVENTIONS
dc.subject	GOVERNMENT SUBSIDIES
dc.subject	GROSS DOMESTIC PRODUCT
dc.subject	GROWTH LITERATURE
dc.subject	GROWTH POTENTIAL
dc.subject	GROWTH PROCESS
dc.subject	GROWTH RATE
dc.subject	GROWTH RATES
dc.subject	GROWTH THEORY
dc.subject	HIGH UNEMPLOYMENT
dc.subject	HUMAN CAPITAL
dc.subject	INCOME
dc.subject	INCOME DISTRIBUTION
dc.subject	INCOME ELASTICITY
dc.subject	INCOME GROWTH
dc.subject	INCOME GROWTH RATE
dc.subject	INCOME LEVELS
dc.subject	INDIVIDUAL COUNTRIES
dc.subject	INDIVIDUAL FARMERS
dc.subject	INDIVIDUAL FIRM
dc.subject	INDIVIDUAL FIRMS
dc.subject	INDUSTRIAL DEVELOPMENT
dc.subject	INDUSTRIAL POLICY
dc.subject	INDUSTRIALIZATION
dc.subject	INFANT INDUSTRY ARGUMENT
dc.subject	INFORMATION ASYMMETRY
dc.subject	INFRASTRUCTURE REQUIREMENTS
dc.subject	INTANGIBLE
dc.subject	INTELLECTUAL PROPERTY
dc.subject	INTEREST RATE
dc.subject	INTERMEDIATE INPUTS
dc.subject	INTERNATIONAL TRADE
dc.subject	INVESTMENT CLIMATE
dc.subject	INVESTMENT DECISIONS
dc.subject	LABOR COSTS
dc.subject	LABOR FORCE
dc.subject	LEGAL FRAMEWORK
dc.subject	LIVING STANDARDS
dc.subject	LOW-INCOME COUNTRIES
dc.subject	LOW-INCOME COUNTRY
dc.subject	MACROECONOMIC MANAGEMENT
dc.subject	MACROECONOMIC POLICY
dc.subject	MACROECONOMICS
dc.subject	MANUFACTURING INDUSTRIES
dc.subject	MARGINAL COST
dc.subject	MARKET ECONOMIES
dc.subject	MARKET FAILURES
dc.subject	MARKET MECHANISM
dc.subject	MARKET SHARES
dc.subject	MICROECONOMIC ANALYSES
dc.subject	MONOPOLY
dc.subject	MORAL RESPONSIBILITY
dc.subject	NATIONAL DEVELOPMENT
dc.subject	NATIONAL ECONOMY
dc.subject	NATURAL MONOPOLIES
dc.subject	NATURAL RESOURCES
dc.subject	OUTPUTS
dc.subject	PATENTS
dc.subject	PER CAPITA INCOME
dc.subject	PER CAPITA INCOMES
dc.subject	PLANNED ECONOMIES
dc.subject	POLICY DISCUSSION
dc.subject	POLICY INSTRUMENTS
dc.subject	POLICY INTERVENTIONS
dc.subject	POLICY MEASURES
dc.subject	POLICY OPTIONS
dc.subject	POLICY PAPERS
dc.subject	POLICY RESEARCH
dc.subject	POLICY VARIABLES
dc.subject	POLITICAL ECONOMY
dc.subject	POLITICAL INSTABILITY
dc.subject	POLITICAL SUPPORT
dc.subject	POOR COUNTRIES
dc.subject	POVERTY REDUCTION
dc.subject	POWER PARITY
dc.subject	PRICE ELASTICITY
dc.subject	PRICE ELASTICITY OF DEMAND
dc.subject	PRIVATE MARKET
dc.subject	PRIVATE SECTOR GROWTH
dc.subject	PRIVATIZATION
dc.subject	PRODUCTION COSTS
dc.subject	PRODUCTIVITY
dc.subject	PRODUCTIVITY GROWTH
dc.subject	PROPERTY RIGHTS
dc.subject	PUBLIC DEBT
dc.subject	PUBLIC GOODS
dc.subject	PUBLIC SECTOR
dc.subject	PUBLIC-PRIVATE PARTNERSHIPS
dc.subject	PURCHASING POWER
dc.subject	RATE OF INVESTMENT
dc.subject	RATE OF RETURN
dc.subject	REGRESSION ANALYSES
dc.subject	REGULATORY REQUIREMENTS
dc.subject	RENT SEEKING
dc.subject	SCARCE CAPITAL
dc.subject	SHADOW PRICES
dc.subject	SKILLED WORKERS
dc.subject	SMALL BUSINESSES
dc.subject	SMALL ENTERPRISES
dc.subject	SOCIAL CAPITAL
dc.subject	STATE ENTERPRISES
dc.subject	STATE INTERVENTION
dc.subject	STATE INTERVENTIONS
dc.subject	STATE-OWNED ENTERPRISES
dc.subject	STRUCTURAL CHANGE
dc.subject	SUSTAINABLE GROWTH
dc.subject	TAX
dc.subject	TAX CREDITS
dc.subject	TECHNOLOGICAL CHANGE
dc.subject	TECHNOLOGICAL INNOVATION
dc.subject	TECHNOLOGY TRANSFER
dc.subject	TELECOMMUNICATIONS
dc.subject	TRADE POLICY
dc.subject	TRANSACTION COSTS
dc.subject	UNEMPLOYMENT
dc.subject	UNSKILLED LABOR
dc.subject	URBAN AREAS
dc.subject	WEALTH
dc.subject	WEALTH CREATION
dc.subject	WORKING CAPITAL
dc.subject	WORLD ECONOMIES
dc.title	Growth Identification and Facilitation : The Role of the State in the Dynamics of Structural Change
dc.type	Publications & Research :: Policy Research Working Paper
dc.coverage	The World Region
dc.coverage	The World Region

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