Paper short abstract:

Colonialism ensured that colonies were dependent on primary commodity exports. We connect several marginalised works within the GVC literature – imperialism, financialisation and dependency – to trace the persistence of colonial structures and ensuing challenges to upgrading primary commodities.

Paper long abstract:

In the 1960s, as African countries became independent, all national governments faced a similar challenge of needing to diversify what they produced and exported. Nearly everywhere, colonialism ensured that former colonies were dependent on exporting primary commodities such as coffee, tea, minerals, or oil. Countries have tried diversifying their economies and upgrading their primary commodity sectors pursuing a range of strategies. The results were variable, and success to diversify exports was limited throughout. This paper builds on the field experience of both authors on primary commodity value chains in two African countries – coffee and cocoa in Rwanda and Ghana – and connects several disparate and relatively marginalised works within GVCs, namely imperialism, financialisation and dependency, to highlight contemporary challenges to upgrading primary commodities within Africa. In doing so, the paper highlights the centrality of colonialism in shaping how contemporary inter-scalar power relations continue to shape prospects for getting more out of the value of primary products. Further, the paper highlights the difficult political challenges that result domestically because of dependence on global commodity price fluctuations and how these challenges have persisted as a result of colonial structures which have been reproduced over time. In doing so, the paper argues that upgrading commodity sectors is only possible by breaking through these colonial structures.

Paper short abstract:

Considering the impact of China’s BRI in Kyrgyzstan, this study finds that the BRI has had limited impact on manufacturing development, despite the presence of open markets and of infrastructure finance. It suggests the causes lie in the disinterest of the government towards manufacturing.

Paper long abstract:

With its infrastructural offer and emphasis on connectivity, China’s Belt and Road Initiative (BRI) promises to support developing countries aiming to structurally transform their economies and industrialise. The literature on industrialisation has identified a key role for infrastructure, markets and the state to promote manufacturing development. This article asks under what conditions the BRI can support structural transformation, and looks at the case of Kyrgyzstan, one of the first countries to join the initiative, to identify key factors in the structural transformation process. Using a case study approach and combining in-country interviews with a vast review of the literature, this study finds that the country has made little progress towards structural transformation, despite the presence of open markets and the availability of infrastructure finance. It suggests that this is because the government has not steered resources towards industrialisation and only made timid attempts to promote transformation. The article suggests that an emphasis on the role of the state, rather than on the market or infrastructure, is needed to explain the progress (or lack thereof) in terms of structural transformation under the BRI.

Paper short abstract:

Data on learning-by-doing in South African and Kenyan firms reveals how workers develop production capabilities. Insights show that learning is informal, self-determined, and worker-led, raising questions about the (re)production of capabilities.

Paper long abstract:

Learning and capabilities acquisition is widely accepted as necessary for structural transformation and economic development (Otieno, 2013; Bloom et. al., 2006). This research unpacks the role of workers in driving learning, and developing diverse capabilities, and argues that worker-led learning is embedded and central to production.

Debates around learning-by-doing have focused on how firms learn, the policy environments, formal education, and training that support these processes, and the structural constraints that mediate these (Amsden, 1997; Jones, 2005; Andreoni, 2014). Resource-based economics has called attention to the different capabilities, including technological, managerial, and entrepreneurial skills, necessary for production (Ouma & Whitfield, 2012; Upadhyaya & McCormick, 2020).

More recently, the focus has shifted to exploring how and why individual workers learn. Drawing on original fieldwork data from micro-, small- and medium-sized firms in South Africa and Kenya, across several manufacturing and services sectors, we show that learning is a continuous and multilayered process. Rather than looking at the learning of firms, our evidence reveals the diverse actions of individual owners, managers, and workers within firms.

The evidence from our cases reveals that learning draws from informal and formal sources, is self-determined and ongoing rather than externally determined, and combines overlapping capabilities and skills. We show that workers occupy a central role in improving and developing production through identifying and updating capabilities and knowledge. Understanding learning as a lifelong and worker-led component of production raises new questions about the challenges and drivers of the (re)production of capabilities, and the solutions to address these.

Paper short abstract:

This paper explores the potential of green industrialisation to aid structural transformation through labour-intensive production and generate a discussion on policy approaches to ensuring that green industrialisation is able to generate this labour-intensive industrialisation.

Paper long abstract:

The intensive utilisation of labour in production processes has significant implications for structural transformation. Labour-intensive industrialisation, particularly in East Asia, has been proposed as an alternative paradigm to traditional Western capital-intensive models of industrialisation but has been less explored from a perspective that centres climate change and the green transition. The labour-intensive industrialisation approach suggests a significance of upgrading the quality of labour for the industrialisation process as demonstrated in East Asian economies; particularly Japan. Accordingly, this paper assesses the contribution of green industries not only to employment generation but also the upgrading and capability-building of labour through engagement with the theory on labour-intensive industrialisation and presenting the historical experience of labour-intensive industrialisation in East Asia; China, Korea, and Japan in particular, in order to reiterate common factors for their success. It also briefly discusses methodological concerns over measuring the labour intensity of production and the measurement of green jobs. The solar energy industry is utilised as a case study to determine the contribution of green industries to employment generation. The paper then concludes with the proposal a policy approach that centres labour-intensive production in sustainable development based on the theory and historical experiences. This proposal also identifies context-specific factors in other regions such as Sub-Saharan Africa that will need to be overcome in order to generate labour-intensive green industrialisation.

Paper short abstract:

This paper lays out a high wage high employment strategy for economic development in the Global South. An international analysis of Leontief multipliers shows that not only backward linkages but domestic consumption, labor intensity and high wages create substantial secondary growth.

Paper long abstract:

Leontief multipliers measure how increases in production in any sector lead to additional growth in other sectors. Industries and nations vary in their size of multipliers in ways that are poorly understood in development studies. Contrary to expectations, countries in the Global North do not have higher multipliers than those in the Global South. Some countries, such as Brazil, Argentina and Australia, have surprisingly high multipliers, while other countries like Switzerland do surprisingly poorly.

This analysis contrasts the size of multipliers in a global sample of 61 countries for 2005, 2010, 2015, and 2018. Data comes from the OECD’s standardized Input-Output tables. We examine three types of multipliers: Type I multipliers (Industrial Supply) which are Hirschman’s backward linkages, Type II – I multipliers which are the consumer goods purchased from the economy by workers in any given industry, and Type II multipliers, which capture the combined effects of both industrial and worker purchases. These last two are rarely considered in analyses of value chains or the effects of transformative industry.

We propose three variables to explain the variation observed in multiplier size across industries and nations: import propensity of the economy, wage intensity of production, and the country’s geographical size. Time-series cross-section analysis supports these hypotheses.

Paper short abstract:

Within the development studies framework, this proposal addresses the relevance of considering that the effects of economic growth on unemployment may be asymmetric and unevenly distributed across the population (i.e. gender or age), as well as tricky to measure using econometric methods.

Paper long abstract:

Okun’s law is one of the best-known empirical regularities in macroeconomics. It addresses the issue of how much a country’s output is ‘lost’ when unemployment exceeds its natural or trend rate. In the existing literature, most of the studies assume a linear long-run relationship between changes in output and unemployment, which implies that economic expansions and recessions have the same effect on unemployment. Nevertheless, this negative relationship may take a nonlinear form, in the sense that changes in output may cause asymmetric changes in unemployment. Consequently, the objective of this paper is to test the linear assumption of Okun's law by deploying a time series analysis of asymmetric adjustments using seasonally adjusted quarterly data from Chile for the period 1996-2019 disaggregated by sex. The analysis is based on an asymmetric error-correction model, which provides a different approach to describe the short-term dynamics between the variables, but at the same time presents different challenges for its implementation. Thus, beyond the analysis of the data, the study explores advantages and disadvantages of procedures that require cointegrated non-stationary time series to establish a long-run equilibrium. Finally, the relevance of this research lies in the consequences of a misinterpretation of the effects of business cycles on unemployment if asymmetry is ignored. For instance, the existence of asymmetric effects shows different speeds of adjustment towards long-run equilibrium. Therefore, the effectiveness and required ‘size’ of stabilization policy on the real economy will depend on the ‘regime’ in which the Okun’s relationship is found.

Paper short abstract:

Drawing upon Ethiopia’s Hawassa Industrial Park (HIP), the paper explores the contradictory encounter between state vision and representation of HIP as industrial promises on the one hand, and employment precarity and production disruption being exacerbated during global pandemic on the other.

Paper long abstract:

A central argument for industrial park-driven economic transformation in Africa is the potential to drive export earnings, facilitate technology transfer, absorb large labor force, and build industrial skills. In this paper, we revisit this conception in the context of global pandemic and the associated disruptions in production, decline in employment, and increase in labor turnover. Drawing upon ethnographic research in Ethiopia’s Hawassa Industrial Park, we explore ways that the Ethiopian government continues to convince workers to sell their labor at a very low price in order to retain foreign investors and stabilize national economy. We problematize such state vision and representation of HIP as industrial promises by tracing the shifts in employment patterns and the corporeal experiences of workers. Our analysis approaches workers’ encounters with industrial parks as a new form of precarious livelihoods, an emerging regime of struggle, and a continuous search for alternative narratives about future African development. Such an employment- and labor-centric analysis, we argue, allows for more critical understanding of industrial transformation and human wellbeing in Africa.

Key words: Development, Industrialization, Industrial park, labor, wage and Media

Paper short abstract:

Representatively measures (Lima) and comparatively analyses (LatinAmerica) production and employment dimensions of the production network delivering 150000 food rations daily while building food production capabilities, reshaping urban food logistics and generating employment on food security claims

Paper long abstract:

Ollas Comunes is the Peruvian variety of a collective productive capability that arises when crises hit Latin America. Ollas Comunes emerged in Peru in the 1980s in the urban margins, mutated into a government-backed food program in the 2000s and re-emerged contentiously at the new urban margins in 2020. In each iteration, young women gather territorially and scale up a network that claims food rights for the poor and in doing so gather produce, build cooking and storage facilities and distribute hot-meals at a layered pricing scheme. They reduce costs by economies of scales mechanisms and redistributes costs and profits of food production. Organisers and cooks develop collective capabilities on food preparation, nutrition and safety food logistics, managerial skills, and political and advocacy skills. In their current iteration, organisers developed georeferenced auditing skills, urban farming skills and food recycling at the city level. Ollas Comunes was studied as subsidy from the poor to the poorest, as social non-for-profit enterprise, as women citizenship movement and bottom-up social policy. This paper delves into the production and employment dimensions of this production network delivering 150,000 food rations daily from 2020 up-to-date while building food production capabilities, reshaping urban food logistics and supply chains, and generating employment of heterogeneous quality (measured along three dimensions of dignity: earnings, respect and voice). This paper sketches the potential and limitations of a whole class of political productive enterprises for good job generation and food security.

Paper short abstract:

The green transition in Southern Africa opens windows of opportunities for sustainable structural transformation and employment generation, beyond direct green jobs. Regulation, development finance and industrial policy must be integrated to direct and coordinate investments and create employment.

Paper long abstract:

Climate Change requires rapid and systemic economic changes across sectors. The green transition in the Southern Africa opens several windows of opportunities for sustainable structural transformation and employment generation, far beyond direct green jobs creation. The employment potential is dependent on several factors, including the extent to which minerals extraction is linked to downstream processing and upstream production and servicing of renewable energy technologies and infrastructures. A third linkage with large indirect employment generation potential is the one connecting renewable energy to downstream green hydrogen and energy-intensive industries. In turn, green hydrogen can be used further downstream to transform difficult to abate sectors – chemicals (and fertilizers), steel (and metal products), and cement – currently fuelled with coal in South Africa, or as a major source of new export in countries like Namibia. The greening of these industries is also becoming a precondition for retaining and expanding jobs in exporting sectors targeting markets with high environmental standards.

Development opportunities can however turn into development traps if such green transitions are not governed and regulated. We argue for integrating regulation, investment and industrial policy to plan, direct and coordinate investments in critical infrastructure and industries. Market-shaping competition and regulatory rules are also essential to create a viable and predictable business environment in the context of technological change. Developmental finance is also essential given the long-term nature of these investments. Overall, this implies the state must play a dynamic industry-shaping role influencing value creation and capture through regulations and industrial policies.

Paper short abstract:

Africa’s abundant renewable energy potential and rare earth and critical minerals endowment can play a pivotal role in pulling productive investments and developing domestic and regional linkages. We develop a framework and new empirical evidence to identify and direct such investment and policies.

Paper long abstract:

The current global supply chain disruptions have intensified the need to develop and promote resilient production and supply networks by diversifying operations across various regions and markets, securing supply of critical materials and industrial inputs, increasing overall supply chains sustainability and compliance with new environmental trade standards. Re-, near-, and friend- shoring of supply chains are examples of this trend, with significant impact on the governance of supply chains and the developmental prospects of productive transformation. This evolving scenario provides a window of opportunity for African countries to reposition and integrate into medium and downstream segments of several ‘global’ value chains. Specifically, Africa’s natural capital – including opportunity for abundant renewable energy generation and endowments of rare earth and critical minerals – can play a pivotal role in pulling productive investments and result in domestic and regional linkages development.

However, leveraging these opportunities would require African countries to improve their manufacturing capacity, and scaling up production and export through the building of domestic and regional linkages and value chains. Using the EORA and BACI data between 2010-2021 at six digit product level for all African countries, the paper develops a framework that maps global value chains of three selected medium and high-technology intensive sectors (mining equipment, mobile technologies, and wind/solar energy), and analyses how African countries can potentially localise and capture value from these supply networks, including building regional value chains. Industrial policy lessons for productive transformation in Africa are discussed based on the empirical and sectoral case studies.

Paper short abstract:

The study compares industrial policymaking in the 1970s and late-2000s Korea to trace the change in business elites' exercising power in industrial policy. It is the information monopoly from their dominant position in production that enables business elites to partake in agenda-setting today.

Paper long abstract:

In the last 60 years since the first development plan in 1962, many studies on the Korean industrial policy took a state-centric perspective placing business elites merely as a supplementary partner or an axis of corruption hindering rational policy. While technocrats and pilot agencies are still important, the role of the private sector has long been emphasised in a specialised, globalised, therefore, ever-complex industrial ecosystem. Meanwhile, democratic consolidation along with economic development has made policymaking more transparent and effective to check cronyism and money politics prevalent in the past. Despite changes in the institutional environment, the influence of big businesses, or chaebol, continues to place the sectors and technologies of their interests at the core of the recent policies. This study compares the policymaking of the heavy/chemical industry in the 1970s and of the new growth engines including green cars (electric vehicles) during the Lee Myung-bak administration (2008-2012). The qualitatively different influence of business elites, namely, from instrumental to structural power, appears 1) in their distance to policymaking (indirect to direct participation), 2) in their participation in agenda-setting not only policy formation and implementation, and 3) from the fact that the source of power is big businesses' dominant and monopsonist position in the production structure that systemically monopolise capital and industrial information which relates to growth and job creation in the country. The review of the business elites' power in this study suggests an impact of industrial development on changes in the political landscape, particularly elite politics.

Paper short abstract:

Given the contradictions in existing frameworks of green industrial policy, I propose a new theory of green industrial policy. This theory combines traditional perspectives on industrial policy, emerging perspectives on green industrial policy, and perspectives from the degrowth paradigm.

Paper long abstract:

Existing frameworks of green industrial policy focus on how the state can steer the economy towards heavier use of clean energy and, more broadly, towards net zero emissions. In this paper, I argue that these existing frameworks have paid insufficient attention to the literature on limits to growth, especially the emerging degrowth paradigm. This paradigm highlights how ecological sustainability is incompatible with constant growth in energy use and resource use. Seeing that traditional industrial policy encourages economic growth and productivity growth, green industrial policy, in turn, relies on growth in energy use and resource use. In this sense, green industrial policy (as presented in existing frameworks) is a contradiction — at its core, it is not truly green.

I propose a new theory of green industrial policy that incorporates traditional perspectives on industrial policy, emerging perspectives on green industrial policy, and perspectives from the degrowth paradigm. My new theory of green industrial policy — green industrial policy 2.0 — puts heavier emphasis on reduction in energy and resource use and ecological justice compared to existing frameworks. In particular, it adds three new policy dimensions: (1) target and scale down ecologically damaging industries and activities, (2) incentivise community-centred living rather than individual-centred living, (3) focus scale-down measures at those responsible for ecological breakdown (e.g., the rich and the global North rather the poor and the global South).

Paper long abstract:

This paper through a case study of a small industrial city- Yuhuan investigates how a rigorous local production system facilitates SMEs penetrate GVCs and its labor dimension.

First, in the case of Yuhuan, we argue that the LPS accommodates several sectoral value chains with overlapping demand for certain production tasks and components, which can facilitate the backward linkages-the service or components providers to achieve economies of scale by pooling society-wide demand. A large LPS with diverse demand can support more comprehensive value chains.

Second, the comprehensive sectoral value chains in Yuhuan support the business model of “components supermarket”, catering the demand for large variety and small quantities orders when local firms participate GVCs. Such a business model occupies a specific niche in the GVCs, where it can avoid competition from the next tier emerging economies with lower wages and costs and prevent confronting with developed countries that focus on highly automated sectors.

Third, our survey finds that technicians and assembly workers’ wages increase faster than administrative workers who usually have higher education than front line workers in a factory. Since migrant workers mainly play the role of technicians and assemblers while most administrative workers are local residents, our survey finds that migrant workers on average earn higher wages than employees with a local hukou. The wage structure is determined by the labor market supply and demand, which is influenced by the industrial structure.