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Beyond Ideological Cleavages: A Unifying Framework for Industrial Policies and Other Public Interventions

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dc.contributor.authorBenhassine, Najy
dc.contributor.authorRaballand, Gael
dc.date.accessioned2012-03-30T07:32:40Z
dc.date.available2012-03-30T07:32:40Z
dc.date.issued2009
dc.description.abstractThis paper introduces a new framework to characterize the diversity of public policies and interventions to spur investment and growth. Going beyond ideological cleavages on this topic, we argue that two orthogonal features determine how much interventions depart fundamentally from neutral policies: (1) their degree of selectivity (in terms of sectors or other targeted categories of firms) and (2) the extent of price subsidies embedded in such interventions. These two characteristics of interventions respond to different types of justifications, and they do not necessarily need to go hand in hand, even if they often do in practice. Depending on their selectivity and/or the extent of price subsidies, interventions are shown to vary in their distortions, their benefits, and their opportunity costs. The framework is used to illustrate how different country characteristics affect these pros and cons of interventionism. In particular, we look at the effects of the initial state of the investment climate, the country's institutional capacity, its political economy context and the nature of the State-business interaction. Using the examples of poor countries with a small undiversified industrial base, we show that it is often in the situations where interventions may be the most needed, that the conditions for their success are likely to be the weakest, which does not mean either that some interventions cannot succeed in low-income countries.en
dc.identifier.citationEconomic Systems
dc.identifier.issn09393625
dc.identifier.urihttps://hdl.handle.net/10986/5407
dc.language.isoEN
dc.relation.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/igo
dc.rights.holderWorld Bank
dc.subjectCapital
dc.subjectInvestment
dc.subjectCapacity E220
dc.subjectIndustrial Policy
dc.subjectSectoral Planning Methods L520
dc.subjectEconomic Development: Financial Markets
dc.subjectSaving and Capital Investment
dc.subjectCorporate Finance and Governance O160
dc.subjectIndustrial Policy O250
dc.titleBeyond Ideological Cleavages: A Unifying Framework for Industrial Policies and Other Public Interventionsen
dc.title.alternativeEconomic Systemsen
dc.typeJournal Articleen
dc.typeArticle de journalfr
dc.typeArtículo de revistaes
dspace.entity.typePublication
okr.doctypeJournal Article
okr.externalcontentExternal Content
okr.identifier.externaldocumentum223
okr.journal.nbpages293-309
okr.language.supporteden
okr.peerreviewAcademic Peer Review
okr.relation.associatedurlhttp://dx.doi.org/10.1016/j.ecosys.2009.08.003
okr.relation.associatedurlhttp://search.ebscohost.com/login.aspx?direct=true&db=eoh&AN=1099245&site=ehost-live
okr.relation.associatedurlhttp://www.elsevier.com/wps/find/journaldescription.cws_home/621171/description#description
okr.volume33
relation.isAuthorOfPublication8762e74d-2213-55a0-aa8d-dfe419512491
relation.isAuthorOfPublication.latestForDiscovery8762e74d-2213-55a0-aa8d-dfe419512491
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