Failure and success of development policies for industrial clusters

The last four decades have witnessed a large number of successful cases of industrial development in Asia, but possibly an equally large number of failures in other developing countries, particularly in Sub-Saharan Africa (SSA). While the governments of developing countries are strongly interested in implementing effective industrial policy, development economists have failed to design widely-accepted effective strategies to develop industries. ¹ Probably this is due partly to the failure of import substitution policies and partly to the commonly accepted neoclassical presumption that “industrial policies” do not work, and thus governments have to do little to promote industrial development beyond the provision of infrastructure such as roads, electricity, and communication systems.