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Theory at Odds with Best Practice: The Travails of Industrial Policy

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  • Irfan ul Haque

    (The author is an unaffiliated researcher who has worked for the World Bank, South Centre, and UNCTAD. He wishes to thank Rashid Amjad, Shahid Amjad Chaudhry, Khalil Hamdani, and Akbar Noman for their perceptive and helpful comments on an earlier draft.)

Abstract

The problems that afflict Pakistan’s manufacturing sector are widely known. It is also recognized that the current state of affairs must change, but there is little agreement as to what that might entail. The lack of consensus on required actions and policies can be traced back to the end of the era of rapid industrialization in the late 1960s and subsequent withering away of the “developmental state” as Pakistan could then be characterized. The industry’s woes tend to be attributed to import substitution and high protection, with the policy implication that the country must further open up and liberalize. The paper questions this proposition and argues for a fresh approach to industrial policy, exploring what this might involve.

Suggested Citation

  • Irfan ul Haque, 2015. "Theory at Odds with Best Practice: The Travails of Industrial Policy," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 20(Special E), pages 87-106, September.
    • Handle: RePEc:lje:journl:v:20:y:2015:i:sp:p:87-106
    as

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    References listed on IDEAS

    as
    1. A. R. Kemal, 2006. "Key Issues in Industrial Growth in Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 11(Special E), pages 49-74, September.
    2. Akbar Noman, 1991. "Industrial Development and Efficiency in Pakistan: A Revisionist Overview," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 30(4), pages 849-861.
    3. Irfan ul Haque, 2007. "Rethinking Industrial Policy," UNCTAD Discussion Papers 183, United Nations Conference on Trade and Development.
    4. Irfan Ul Haq, 2009. "The Rise of Bilateralism in Trade and its Implications for Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 14(Special E), pages 111-133, September.
    5. Hafiz A. Pasha & Muhammad Imran, 2012. "The Prospects for Indo-Pakistan Trade," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 17(Special E), pages 293-313, September.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Manufacturing; industrial policy; Pakistan;
    All these keywords.

    JEL classification:

    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods

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