{
  "title": "Industrial Policy for Growth and Diversification: A Conceptual Framework",
  "publication": "Departmental Papers, September 30, 2022",
  "sourceUrl": "https://www.imf.org/en/publications/departmental-papers-policy-papers/issues/2022/09/28/industrial-policy-for-growth-and-diversification-a-conceptual-framework-519714",
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  "summary": "As countries strive for a strong recovery and to recoup the losses incurred during the COVID-19 pandemic, they need to map out a new path for development and high and sustained growth.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Purpose: Presents a conceptual framework to analyze industrial policy, defined as targeted sectoral interventions.\n- Context: Countries aiming for a strong recovery and to recoup losses incurred during the COVID-19 pandemic need a new path for development and high and sustained growth.\n- Priority: Promoting diversification, developing new industrial capabilities, and designing the policies needed to achieve this goal.\n- Core argument: A successful diversification strategy should tackle both broad policy failures (for example, an unfavorable business environment and investment climate) and sector-specific market failures.\n- Structure of the paper:\n  - Discusses key principles guiding policymakers: focus on market failures that could justify targeted sectoral interventions and potential government failures that can undermine these interventions.\n  - Discusses commonly employed policy tools, their rationale, and associated pitfalls.\n  - Outlines a stylized decision-making framework."
    },
    {
      "heading": "Key principles for policymakers",
      "content": "- Focus on market failures that could justify targeted sectoral interventions.\n- Consider potential government failures that can undermine interventions.\n- Balance sector-specific interventions with reforms addressing broad policy failures, such as an unfavorable business environment and investment climate."
    },
    {
      "heading": "Policy tools and considerations",
      "content": "- The paper discusses commonly employed policy tools, including their rationale and associated pitfalls.\n- Emphasis on:\n  - Rationale for targeted sectoral interventions.\n  - Risks from government failures that may negate intended benefits of interventions."
    },
    {
      "heading": "Decision-making framework",
      "content": "- The paper outlines a stylized decision-making framework to guide industrial policy choices.\n- Framework links identification of market failures, assessment of government capacity and risks, and selection of appropriate policy tools."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subjects: International organization, International trade, National accounts, Political economy, Taxes, Technology\n- Keywords: Diversification, diversification strategy, East Asia, Economic Development, Exports, Global, IMF Library, IMF team, Industrial Policy, Infrastructure, policy failure, Policy tool, Tax incentives\n\n---\n\n Content in this bundle\n\n- ipgdcfea\n  - ipgdcfea (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - ipgdcfea (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/departmental-papers-policy-papers/issues/2022/09/28/industrial-policy-for-growth-and-diversification-a-conceptual-framework-519714"
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    "Authors: Reda Cherif, Fuad Hasanov, Nikola Spatafora, Rahul Giri, Dimitre Milkov, Saad N Quayyum, Gonzalo Salinas, Andrew M. Warner",
    "Published: September 30, 2022",
    "Series: Departmental Papers",
    "DOI: https://doi.org/10.5089/9798400214271.087",
    "Purpose: Presents a conceptual framework to analyze industrial policy, defined as targeted sectoral interventions.",
    "Context: Countries aiming for a strong recovery and to recoup losses incurred during the COVID-19 pandemic need a new path for development and high and sustained growth.",
    "Priority: Promoting diversification, developing new industrial capabilities, and designing the policies needed to achieve this goal.",
    "Core argument: A successful diversification strategy should tackle both broad policy failures (for example, an unfavorable business environment and investment climate) and sector-specific market failures.",
    "Structure of the paper:",
    "Focus on market failures that could justify targeted sectoral interventions.",
    "Consider potential government failures that can undermine interventions.",
    "Balance sector-specific interventions with reforms addressing broad policy failures, such as an unfavorable business environment and investment climate.",
    "The paper discusses commonly employed policy tools, including their rationale and associated pitfalls.",
    "Emphasis on:",
    "The paper outlines a stylized decision-making framework to guide industrial policy choices.",
    "Framework links identification of market failures, assessment of government capacity and risks, and selection of appropriate policy tools.",
    "Subjects: International organization, International trade, National accounts, Political economy, Taxes, Technology",
    "Keywords: Diversification, diversification strategy, East Asia, Economic Development, Exports, Global, IMF Library, IMF team, Industrial Policy, Infrastructure, policy failure, Policy tool, Tax incentives",
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