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- Convenor:
-
Isabella Weber
(Goldsmiths, University of London)
- Discussant:
-
Isabel Estevez
(University of Cambridge)
- Location:
- Lecture Room B (Queens College)
- Start time:
- 13 September, 2016 at
Time zone: Europe/London
- Session slots:
- 2
Short Abstract:
Successful industrialization projects have often begun with great debates over the definition of a new development model. This panel brings together historical arguments with contemporary controversies over industrialization strategies to explore how old insights speak to today's challenges.
Long Abstract:
The attempt of countries to industrialize comprises the aim to change the organization of production, the material living conditions of the domestic population and the relation of the national economy to its regional and international counterparts. Successful cases of industrialization have typically begun by establishing a new economic model as target for the medium or long-term development. The formulation of such a target model is a politically highly contested process that has spurred great debates over the direction and feasibility of different approaches to development at critical junctures after a change of power. Examples of such great debates include the Soviet industrialization debate of the 1920s, the social market economy debate in post-WWII Western Germany, the great reform debate in China in the 1980s and the on-going debate over 'post-neoliberal' models in several South American countries. This panel invites contributions which investigate historical or contemporary cases in which countries facing the challenge of industrialization have engaged in fundamental debates over the direction, means and feasibility of industrial development. By bringing together research on these debates in different historical settings we hope to improve our understanding of the role of intellectual arguments in the political process of defining development paths. We intend to discuss recurring themes and ways of reasoning that reflect the position of these countries in relation to the global economy as well as their perception of policy space.
Accepted papers:
Session 1P. Sai-wing Ho (University of Denver)
Paper short abstract:
Smith’s division of labour, stressed by Young and (subtly) by Hirschman, helps appreciate what industrial development entails. In a transnational-corporation dominated world, caution against passively joining global value chains is advised. Creating domestic linkages (division of labour) is pivotal.
Paper long abstract:
Industrial development can be appreciated as attaining increasingly intricate division of labor in the economy, akin to Smith's woolen-coat example in his Wealth of Nations, which represents how the necessities and conveniences of the "day-labourer" of his time were procured with the "assistance and cooperation of many thousands" of "branches" of work across the economy. That insight of Smith was later accentuated by Young, who characterised the division as "industrial differentiation" that involves increasingly "roundabout methods" of production. In a world with growing production fragmentation, there are opportunities for developing countries that are otherwise reliant on primary/agricultural production to latch onto nodes along certain global value chains (GVCs). Smith believed that "universal opulence [resulting from division of labour] … extends itself to the lowest ranks of the people". Such optimism cannot easily be justified in today's world when critical nodes of key GVCs are monopolised by giant transnational corporations, which adversely impact north-south income distribution and technology diffusion. In this context, instead of leaving outcomes to Smith's "invisible hand", cases can be made for state involvement in southern development promotion by strategically facilitating the activation of domestic production linkages à la Hirschman, who first focused on market size as the key enabling factor for activating them, but subsequently emphasised overcoming "technological alienness". This is not a call to return to centrally planned division of labor, as when a state simultaneously establishes certain sectors that are chosen based on synchronic input-output analysis, for history has revealed its many drawbacks.
Maria Dahl (King's College London)
Paper short abstract:
The Indian School of Political Economy was founded in the late 1800s to understand the poor state of development in colonial India. This paper will look at the school’s founder, Mahadev Govind Ranade, to investigate whether the school was able to construct an ‘Indian’ idea of development.
Paper long abstract:
Debates over what constitutes development have interested political economists for centuries. Since the concept of development formally emerged in the beginning of the 19th century, industrialisation has seemingly become the most agreed upon instrument and goal. A similar idea of development emerged within the Indian School of Political Economy (ISPE) in the last quarter of the 19th century. The school's members were growing increasingly frustrated at the state of development in colonial India. This particular paper will concentrate on the writings of Mahadev Govind Ranade - the founder of the ISPE. Existing political economic theory taught to the school's members in the Western style universities in India seemed inadequate for India's socio-economic environment. Accordingly, ISPE was founded to develop a new approach to development catered to India's specificities. However, the school's idea of development is similar to the dominant and widespread Western concept of development, i.e. industrialisation. This paper will trace the origins of development discourse in ISPE between 1870 and 1914. In particular, the paper will trace how Western schools of political economy (namely, Classical Political Economy, the German Historical School and American Political Economy) shaped ISPE's conceptualisation of development. This paper aims to identify the assumptions of development in Indian Political Economy that seemingly constrain their theories into a pre-established structure. Despite these constraints, the paper will also investigate whether the Indian political economists at the turn of the 19th century were able to construct an 'Indian' idea of development.
Alessandro Iandolo (London School of Economic and Political Science)
Paper short abstract:
Combining Soviet and Ghanaian sources, this paper aims to show how the Soviet Union promoted a vision of economic development that anticipated the emergence of import-substitution industrialisation by nearly a decade.
Paper long abstract:
Between 1957 and 1964 the Soviet Union tried to export to Ghana a model of economic and social development. Moscow's policy was driven by the conviction that socialism was a superior economic system, and could be replicated successfully in West Africa.The USSR recommended that the Ghanaian government adopt a development strategy based on closed markets, state investment, and public ownership of the means of production. However, Soviet confidence in the project was undermined by the unreliability of local leaders and by rising costs. Combining Soviet and Ghanaian sources, this paper aims to show how the Soviet Union promoted a vision of economic development that anticipated the emergence of import-substitution industrialisation by nearly a decade.
Hazel Gray (University of Edinburgh) Marc Wuyts (International Institute of Social Studies of Erasmus University Rotterdam)
Paper short abstract:
This paper explores the changing role of social policy in industrialization initiatives in Tanzania from the 1970s. It provides evidence of underlying political and theoretical changes that have altered the understanding of the constitutive nature of social and economic policy over time.
Paper long abstract:
Industrialization has recently returned to the centre of economic planning in Tanzania after a shift away from the concern with growth and poverty reduction of the 1980s and 1990s. Yet during the 1970s, industrialization was also an issue of prime policy concern for the newly independent socialist government of Tanzania. The debates on industrialisation and economic change during the 1970s were rich in content, but have since disappeared from sight, either because they are seen as erroneous or as no longer relevant. Current industrial policies focus on supply side constraints. Industrial policy in the 1970s however contained greater awareness of the importance of securing a constitutive connection between economic and social policies in the process of industrialisation, The focus on health care, for example, went together with the establishment of pharmaceutical industries in Tanzania, and, similarly, the educational policies was not only about schools, but also involved thinking about the industrial supply of necessary materials for teaching. This paper explores the historically changing role given to social policies within industrialization initiatives in Tanzania by examining industrial and economic policies from the 1970s. It argues that compared to past iterations of industrialization initiatives, the return to concern with industrialization now has a narrow focus on supply side issues and ignores questions of demand, consumption and human needs in bringing about a path of industrialization that can achieve improvements in human wellbeing over time.
Joanne Tomkinson (SOAS, University of London)
Paper short abstract:
This paper examines industrial policies and debates in two late developing states – Ethiopia and Vietnam. It focuses on discussions regarding the loss of policy space under neoliberalism and argues against excess pessimism about prospects for structural transformation under current conditions.
Paper long abstract:
This paper examines industrial policy and domestic debates regarding industrialization in two late developing states - Ethiopia and Vietnam. It offers a critique of what it identifies as the heterodox development literature's tendency toward pessimism about prospects for economic development under contemporary conditions of global neoliberalism. The conditionalities of the Bretton Woods Institutions; rules within multilateral, regional and bilateral trade and investment agreements; and global market changes in the areas of production and finance, are all often said to have cumulatively so narrowed the scope for policies directed at structural transformation, that the 'policy space' for developmental polices (such as those used by East Asian developmental states) has all-but closed. This paper explores the problematic assumptions underlying such pessimism and argues that all of these are contested political, as well as economic processes, that do not have uniform effects on developing states. An analysis of the political economy of industrial policy in Ethiopia and Vietnam shows how the uneven architecture of the global neoliberal order impacts, and is in turn understood and resisted by, two late developing countries in the course of their industrialization efforts.