Industrial Policy and Structural Change: Some Policy Perspectives

Michael Mbate

United Nations Economic Commission for Africa

Addis Ababa, Ethiopia.


Recent empirical evidence underscores the vital role of industrial development in fostering structural change and promoting a country’s long-run development objectives. Promoting a vibrant industrial and manufacturing sector creates opportunities for higher per capita income as well as prospects for reducing poverty and inequality. This paper examines the rationale for industrial policy, why it has been ineffective in most countries and what are the policy lessons to be distilled from past experiences. The paper then presents a comprehensive macroeconomic framework to guide policy makers in designing effective industrial policies. Taking into account country and sector specificities, the paper concludes by examining the various industrial policy tools which can be implemented to accelerate industrial development on the continent.  

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