Selective Intervention and Growth: The Case of Korea

Marcus Noland

No WP04-3, Working Paper Series from Peterson Institute for International Economics

Abstract: This paper attempts to determine whether conditions amendable to successful selective interventions to capture cross-industry externalities are likely to be fulfilled in practice. Three criteria are proposed for good candidates for industrial promotion: that they have strong interindustry links to the rest of the economy, that they lead the rest of the economy in a causal sense, and that they be characterized by a high share of industry-specific innovations in output growth. According to these criteria, likely candidates for successful intervention are identified in the Korean data. It is found that, with one exception, none of the sectors promote by the heavy and chemical industry (HCI) policy fulfills all three criteria.

Keywords: Korea; industrial policy; growth (search for similar items in EconPapers)
JEL-codes: O14 O38 (search for similar items in EconPapers)
Date: 2004-08
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Citations: View citations in EconPapers (5)

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Chapter: Selective Intervention and Growth: The Case of Korea (2004)
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