Downstream activities: The possibilities and the realities

Olle Östensson and Anton Löf

No wp-2017-113, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: The paper discusses the practical possibilities of achieving increased downstream processing and the policies that are commonly used for this purpose. It reviews the reasons why forward vertical integration is not always an optimal choice for extractive industry companies. It finds little support for the argument that differences in market power dictate the geography of downstream processing. Tariffs on processed products may also play only a limited role. The degree of vertical integration varies and appears to be mainly driven by production economics.

Keywords: Extractive industries; Downstream processing; Vertical integration; Industrial policy (search for similar items in EconPapers)
Date: 2017
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