APO resource visit counts have been improved. For more information, see our Policies & Guidelines

Book

Trouble in the making? The future of manufacturing-led development

20 Sep 2017
Description

In the past, manufacturing-led development typically delivered both productivity gains and job creation for unskilled labor. Underpinning the productivity benefits was the sector’s tradability in international markets, which not only reinforced scale economies and technology diffusion, but importantly, also provided greater opportunities to access demand beyond the domestic market and increased competition. The agricultural sector was also tradable but faced demand-side constraints owing to a low income elasticity of demand and productivity improvements that were closely linked to labor-saving technologies. Many low-end services could also absorb surplus labor from agriculture but provided little by way of productivity growth.

Looking ahead, changing technologies and shifting globalization patterns call the feasibility of manufacturing-led development strategies into question. Trade is slowing. Global value chains (GVCs) remain concentrated among a relatively small number of countries. The Internet of Things, advanced robotics, and 3-D printing are shifting the criteria that make locations attractive for production and are threatening significant disruptions in employment, particularly for low-skilled labor. These trends raise fears that manufacturing will no longer offer an accessible pathway for low-income countries to develop and, even if feasible, would no longer provide the same dual benefits of productivity gains and job creation for unskilled labor. As a result, the potential risk of growing inequality across and within countries warrants closer attention to the implications of changing technology and globalization patterns.

Much of the attention on changing technologies and globalization patterns treats “manufacturing” in the aggregate, highlights the downside risks, and focuses on high-income countries. This book, in contrast, looks at changing technology and globalization from the perspective of low- and middleincome countries (LMICs)—with an emphasis on analyzing differences across manufacturing subsectors and identifying policy priorities with an eye toward making the most of new opportunities. Any forward-looking discussion is inherently speculative; the aim here is to identify possible challenges and opportunities for LMICs to help them strengthen their position now.

The book will answer the following questions:
• How has the global manufacturing landscape changed, and why does this matter for development opportunities?
• How are emerging trends in technology and globalization likely to shape the feasibility and desirability of manufacturing-led development in the future?
• If low wages are going to be less important in determining competitiveness, how can less industrialized countries make the most of new opportunities that shifting technologies and globalization patterns may bring?

Publication Details
Identifiers: 
doi: 
10.1596/978-1-4648-1174-6
isbn: 
978-1-4648-1193-7
Access Rights Type: 
Open
Language: 
English
License Type: 
CC BY
Published year only: 
2017
11
Share
Share
Subject Areas
Advertisement