Paper short abstract:

This paper concerns the political economy of industrial policy formulation and implementation. It compares subnational cases from Mexico (Jalisco and Querétaro) via process-tracing to better understand how shifting coalitions assemble resources and support for successful industrial policy.

Paper long abstract:

The global pandemic, climate crisis, and intensified geopolitical tension are all motivating a new common wisdom that states must intervene more actively in the economy to solve problems otherwise intractable to the market. Despite a strong consensus among scholars and policymakers on this need, important questions remain as to how states become able to intervene effectively in such complex and uncertain arenas. We take up this question by leveraging sub-national variation in industry trajectories in Mexico. Focusing on the regionally proximal states of Querétaro and Jalisco, we consider a "reversal of fortune" since the 1980s. Jalisco, much larger and initially wealthier than Querétaro, was poised to become "Mexico's Silicon Valley"; however, these aspirations fizzled and the state experienced an extended period of economic stagnation. Meanwhile, Querétaro, much smaller and poorer than Jalisco, grew quickly to Mexico's forefront in advanced manufacturing and skilled labor (e.g. engineering, R&D), all while quickly rising in the national ranks of GDP per capita. We investigate this surprising reversal by tracing changes in each state's ruling regimes over time - their coalitions, resources, policies, and implementation processes. We use this process-tracing approach to better isolate how changes in coalitional composition enable and constrain state capacity to resolve coordination challenges and enact the kinds of industrial transformation that are the goals of today's industrial policies.

Paper short abstract:

The paper offers a political economy analysis of post-2000 Rwanda's economic transformation. It discusses why some industries were successfully built up or professionalised, while others made very little progress. It provides evidence for why Rwanda's agricultural transformation failed.

Paper long abstract:

Rwanda's political settlement has provided the ruling elite with both the political will and the political power to pursue economic transformation. While remarkable success in state-building and socio-economic indicators is as undisputed as the country's limitations on political freedom, structural economic transformation outcomes have been mixed. Initial success in coffee and tourism contrasts with preliminary failure in manufacturing and food crops. It is argued that the prevailing patterns can be explained by studying how the manifestation of the Rwandan government's main instrument of policy performance monitoring and enforcement -its imihigo system- fits together with each sector's transformation requirements. While the top-down governance mode worked sufficiently well to build up a domestic coffee-processing as well as a high-end eco- and conference tourism sector, it was inadequate to create a competitive manufacturing sector or to transform unproductive subsistence agriculture. The general argument is illustrated by diving into the details of the country's failed agricultural transformation. In particular, simple qualitative and quantitative evidence from official Rwandan sources is provided to show how food crop production was massively overestimated from 2008 to 2014, while actual output levels stagnated. Even more, overreporting was driven by a rigid performance contract system that incentivised farmers and agronomists to tweak the numbers instead of compelling them to achieve actual results. The paper concludes that Rwanda may need a more sophisticated and flexible governance system that supports entrepreneurial experimentation and bureaucratic discretion for sustained economic transformation progress.

Paper short abstract:

In this paper, we explore the role of industrial business groups in high-income transition by undertaking a comparative institutional analysis of Indonesia's Salim and South Korea's Samsung.

Paper long abstract:

For emerging economies, worries over "middle-income trap" loom large. And while the Silicon Valley model has become the standard policy response to innovation-led high-income transition, the role that large business groups can play remains under explored. Business groups in middle-income economies are often viewed as the problem — i.e., "Frankensteins" relying on rents that the industrial polices generate — rather than an ecosystem for building "industrial commons" that can enhance economic diversity and complexity. To explore their role in high-income transition, we examine business groups in Indonesia's Salim and South Korea's Samsung as exploratory case studies. Our argument is that whether business groups become Frankensteins and industrial commons depends on the coalitions that are able to infuse "patience" into their corporate governance regimes. Our findings open new avenues for studying the middle-income trap that go beyond the Silicon Valley model.

Paper short abstract:

This paper introduces the concept of 'authoritarian centralization' to bring together theorizing on authoritarianism with that on the politics of policy integration, so as to analyse the politics behind the lack of integration between Industrial and urban development and planning in Africa.

Paper long abstract:

A growing body of literature address the implications of the ongoing rapid state-led and export-oriented industrialization in African cities for a range of development concerns. E.g., labour relations, value chain development, and China's involvement in infrastructural development. This study focuses on another vital implication of Africa's rapid industrialization - urban industrial integration- that has not been sufficiently explored. The niche body of work that does look at the interaction of urban and industrial development identifies challenges that are emerging at the nexus and attributes these challenges to a lack of policy integration. However, this literature does not address why the disconnect between the policy spheres arises or why it continues to persist.

I argue policy fragmentation in the African urban industrial nexus is driven by processes of 'authoritarian centralization' that fosters adverse political conditions for policy integration- more specifically conceptual integration, policy coordination and infrastructural integration. Based on an interpretive policy analysis of the case of the Ethiopia's Industrial Development Policy (2001-2020) and its implementation, the study illustrates the relationship between authoritarian centralization and policy integration and discusses the ways in which authoritarianism has shaped urban policy, planning and development and its integration into industrial and economic development strategies. The death of PM Meles Zenawi is identified as a critical juncture that illuminates broader issues of the nature of authoritarian rule under EPRDF and the politics of policy integration in ethno-federal party state. The paper contributes to the literature on the politics of urban industrialization in a broader range of developmental authoritarian African states.