The Relevance of the Concept of Developmental Industrial Policy in Times of Globalisation: Insights from Low-Income Countries

Alice Sindzingre

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Abstract: The concept of developmental state has explained the spectacular growth of Asian countries by a key common characteristic, industrial policy. The relevance of the concept in the 21st century is questioned in two steps. Firstly, this concept may have been an ideal-type in view of marketisation and retreat of the state in Asia, and the developmental state remains challenged by ‘cronyism'. Secondly, the concept's usefulness is questioned because: i) conceptualisations of developmental states and industrial policies occurred before globalisation: though Asian developmental states were themselves ‘latecomers', the question remains of the relevance of industrial policies for poor countries (typically Sub-Saharan Africa) in a context of globalisation. Simultaneously, though these theories have not been implemented in the most successful countries (the US, China), the concept of the developmental state is challenged by the theories that have underlain globalisation in the 1980s, i.e. that generalised liberalisation fosters growth; ii) at the time of analyses of Asian developmental state, the world was mainly multilateral, in contrast with the explosion of regional agreements at the beginning of the 21st century, which questions the possibility of developmental industrial policies. The argument highlights a paradox for poor latecomers: while globalisation makes industrial policies more difficult for these countries, it facilitates the move of global capital to cheaper countries when production costs rise and therefore the possibility for these countries to implement labour-intensive industrial policies.

Keywords: Industrial policies; developmental state; low-income countries (search for similar items in EconPapers)
Date: 2016
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Published in 24th World Congress of the International Political Science Association (IPSA) , 2016, Poznan, Unknown Region

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01669867

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