Virtual Institute Teaching Material on Structural Transformation and Industrial Policy
Aimed at students and lecturers/researchers of economics or social studies, as well as a generalist audience of stakeholders interested in the topic, this Vi teaching material reviews theories and empirical findings on structural transformation and industrial policy, highlighting their role in socio-economic development.
Module 1, titled "The structural transformation process: trends, theory and empirical findings," defines a conceptual framework for the analysis of structural transformation, based on both historical and recent patterns of structural transformation in developed and developing economies. It then examines the evolution of development thinking and empirical literature on structural transformation. It concludes by analyzing the role of structural transformation in social and human development, and in particular the relationship between structural transformation and human development as reflected in the Millennium Development Goals.
Module 2, titled "Industrial policy: a theoretical and practical framework for thinking about – and applying – industrial policy," discusses how governments could support the process of structural transformation. After introducing the definitions and concepts related to industrial policy and its design and implementation, it discusses the role of industrial policy in structural transformation, reviewing the arguments in favor and against industrial policy. It provides country and sectoral examples of successful implementation of industrial policy, and discusses the challenges to structural transformation and industrial policy faced by developing countries today. To illustrate both theoretical and empirical aspects of the topics covered, the material uses country case studies, empirical data, and reviews of relevant research papers. It also contains exercises and discussion questions for students.