Industrialization as Capacity Building: Skills, Technical Progress, and Technical Capabilities

Many confuse industrialization with the construction of factory buildings. In fact, it is primarily a skill accumulation and a capacity-building process with a significant intangible aspect; more than hardware, industrialization resembles software. Successful industrialization is possible if skill accumulation and the capacity-building processes are successful. A key implication is that industrial policy should take this into consideration in order to achieve its targets. Instead of targeting mere construction of factory buildings, industrial policy should focus on the long-term capacity-building process.

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