ABSTRACT
This chapter discusses an alternative model of economic diversification that has been advanced by Mahroum and Al-Saleh, namely 'demand-led related diversification' (DLRD). The DLRD model stipulates that successful economic diversification and industrial renewal strategies have higher chances of success if: they are based on existing or anticipated market demand, either domestically or globally, and they can be - at least partially - supplied by existing domestic capabilities. Market demand is essential for any economic growth, as both economic and innovation activities take place specifically to meet and satisfy the demand for goods and services. The categorisations of demand and related variety platforms bring new dimensions to the debate about the role of demand in economic development and indeed competitiveness, but also the potential role of government. The debate about the role of 'demand' in economic development takes on a different dimension when it is perceived from the angle of innovation and the creation of new markets.
