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Is manufacturing still the engine of growth?

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  • W. McCausland
  • Ioannis Theodossiou

Abstract

This paper focuses on an interesting and controversial debate on the factors underlying economic growth. Kaldor's belief that increasing returns to manufacturing production are the driver of growth is confronted with data from 11 representative countries spanning nearly two decades. Various alternative and complementary specifications are investigated using a panel estimation methodology. The results show that growth in manufacturing output is an important determinant of both productivity growth and gross domestic product growth, and that, despite its increasing size, the service sector does not appear to play a similar role.

Suggested Citation

  • W. McCausland & Ioannis Theodossiou, 2012. "Is manufacturing still the engine of growth?," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 35(1), pages 79-92.
    • Handle: RePEc:mes:postke:v:35:y:2012:i:1:p:79-92
    DOI: 10.2753/PKE0160-3477350105
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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Planes and trains can deliver the growth the IMF wants
      by W David McCausland, Senior Lecturer in Economics at University of Aberdeen in The Conversation on 2013-05-22 19:28:32

    Citations

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    Cited by:

    1. Olabode Eric Olabisi (Ph.D), 2020. "Causality between Manufacturing Efficiency, Energy Use and Economic Growth in Nigeria," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(8), pages 671-675, August.
    2. Yifei Li & Yuhang Bai, 2023. "Research on the Impact of Global Economic Policy Uncertainty on Manufacturing: Evidence from China, the United States, and the European Union," Sustainability, MDPI, vol. 15(14), pages 1-18, July.
    3. Umberto Monarca & Ernesto Cassetta & Michele Lo Re & Linda Meleo, 2019. "A Network Analysis of the Intersectoral Linkages Between Manufacturing and Other Industries in China and Italy," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 11(1-2), pages 80-97, January.
    4. John Bosco Nnyanzi & Susan Kavuma & John Sseruyange & Aisha Nanyiti, 2022. "The manufacturing output effects of infrastructure development, liberalization and governance: evidence from Sub-Saharan Africa," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 49(2), pages 369-400, June.
    5. Satya Prasad Padhi, 2021. "Employment dynamics, increasing returns and Marx's falling rate of profit," PSL Quarterly Review, Economia civile, vol. 74(298), pages 219-245.
    6. Bokosi, Fanwell Kenala, 2022. "The Effects of Industrialisation on Economic Growth: Panel data evidence for SADC countries," African Journal of Economic Review, African Journal of Economic Review, vol. 10(3), June.
    7. Saba, Charles S., 2023. "Investigation of Telecommunication Infrastructures-Industrialisation-Growth Nexus: Evidence from Disaggregated Panel Data Analysis," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 76(2), pages 209-264.
    8. Österreichische Forschungsstiftung für Internationale Entwicklung (ÖFSE) (ed.), 2013. "Österreichische Entwicklungspolitik 2013. Private Sector Development: Ein neuer Businessplan für Entwicklung?," Austrian Development Policy Report, Austrian Foundation for Development Research (ÖFSE), number 268192.
    9. Isaac Ketu & Paul Ningaye & Anatole Tchounga, 2024. "Industrialization in the face of economic policy uncertainty: cross-country evidence," Economics Bulletin, AccessEcon, vol. 44(2), pages 601-610.
    10. Charles Shaaba Saba & Nicholas Ngepah, 2022. "ICT Diffusion, Industrialisation and Economic Growth Nexus: an International Cross-country Analysis," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(3), pages 2030-2069, September.
    11. Yahya Z. ALSHEHHI & Judit OLÁH, 2017. "Sectorial Analysis: Growth Accounting Of Secondary Industries," Network Intelligence Studies, Romanian Foundation for Business Intelligence, Editorial Department, issue 9, pages 39-45, June.
    12. Mustafa Ozturk & Yavuz Agan, 2017. "Determinants of Industrial Production in Turkey," Journal of Economics and Financial Analysis, Tripal Publishing House, vol. 1(2), pages 1-16.
    13. Mark Dean & Al Rainnie & Jim Stanford & Dan Nahum, 2021. "Industrial policy-making after COVID-19: Manufacturing, innovation and sustainability," The Economic and Labour Relations Review, , vol. 32(2), pages 283-303, June.
    14. Eric E. O. Opoku & Muazu Ibrahim & Yakubu A. Sare, 2018. "Foreign Direct Investment, Sectoral Effects and Economic Growth in Africa," Working Papers 769, Economic Research Southern Africa.
    15. Haraguchi, Nobuya & Cheng, Charles Fang Chin & Smeets, Eveline, 2017. "The Importance of Manufacturing in Economic Development: Has This Changed?," World Development, Elsevier, vol. 93(C), pages 293-315.

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