Publication: On the Welfare Costs of Premature Deindustrialization
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2023-03
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2023-03-13
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Developing countries are deindustrializing at earlier stages of development than experienced by advanced economies. Is this trend symptomatic of inefficiency If so, what are the welfare costs This paper proposes a definition of premature deindustrialization based on whether the pace of deindustrialization diverges from the one implied by a theoretical benchmark of efficient sectoral allocation. It identifies 10 episodes of premature deindustrialization, carrying negligible welfare costs, below 1 percent of aggregate consumption.
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“Fattal Jaef, Roberto N.. 2023. On the Welfare Costs of Premature Deindustrialization. Policy Research Working Papers; 10344. © World Bank. http://hdl.handle.net/10986/39519 License: CC BY-NC 3.0 IGO.”
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