Reducing complexity in the industrial policy debate

Abstract

A central concern of industrial policy is how to configure the relationship with the global economy. The many-fold choices and pressures make this a difficult task for policymakers. This paper suggests a way of framing discussions between policymakers, advisers and researchers. It seeks to reduce complexity and help find common ground. It shows how different constellations of low/high challenge and low/high support bring out the essence of different policy regimes. And it shows how different constellations of narrow/wide technology gap and narrow/wide marketing gap help identify the most plausible way forward. Keywords: industrial policy, late-comers, competitiveness, value chains, technology gap, marketing gap, Egypt.