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CID Working Paper No. 168

Reconfiguring Industrial Policy: A Framework with an Application to South Africa

Ricardo Hausmann, Dani Rodrik, and Charles F. Sabel

May, 2008

A publication of the CID South Africa Growth Initiative

Abstract

The main purpose of industrial policy is to speed up the process of structural change towards higher productivity activities. This paper builds on our earlier writings to present an overall design for the conduct of industrial policy in a low- to middle-income country. It is stimulated by the specific problems faced by South Africa and by our discussions with business and government officials in that country. We present specific recommendations for the South African government in the penultimate section of the paper.

Keywords: industrial policy, South Africa

JEL codes: O25

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