Pelagidis, Theodore and Mitsopoulos, Michael (2019): In Defense of Making Things: Why Manufacturing Still Matters. Published in: Industrial Relations , Vol. 74, No. 1 (2019)
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Abstract
A relatively recent International Monetary Fund (IMF) publication is not the only voice that suggests the possibility of achieving prosperity and growth in the modern age without the need to have a strong manufacturing base. Like agriculture before the industrial revolution, "making things" appears to take the back seat as services, and in particular knowledge intensive services that determine "hot to make things", take over as growth drivers. Of course, the trends of progress are irreversible, and "making things" will constitute a shrinking part of employment and, possible value created. The latter will most likely be even truer if one cannot separate perfectly the value of incorporated services, as the knowledge content of the "things made" and the incorporated services build their own complex interactions and grow exponentially.
| Item Type: | MPRA Paper |
|---|---|
| Original Title: | In Defense of Making Things: Why Manufacturing Still Matters |
| Language: | English |
| Keywords: | Manufacturing, Industrial Development, Innovation |
| Subjects: | L - Industrial Organization > L6 - Industry Studies: Manufacturing |
| Item ID: | 107019 |
| Depositing User: | Theodore Pelagidis |
| Date Deposited: | 07 Apr 2021 01:27 |
| Last Modified: | 07 Apr 2021 01:27 |
| References: | IMF (2018) “Manufacturing Jobs: Implications for Productivity and Inequality”, WEO April, Chapter 3. https://www.imf.org/en/Publications/WEO/Issues/2018/03/20/world-economic-outlook-april-2018 Dani Rodrik (2011) “The Manufacturing Imperative.” Project Syndicate, Aug 10. OECD (2016) Enabling the Next Production Revolution: The Future of Manufacturing and Services - Interim Report. Meeting of the OECD Council at Ministerial Level Paris, 1-2 June. Michael L. Dertouzos, Robert M. Solow and Richard K. Lester (1989) Made in America Regaining the Productive Edge. Cambridge: MIT Press. Suzanne Berger, with the MIT Task Force on Production in the Innovation Economy (2013) Making in America. From Innovation to Market, MIT Press, and Richard M. Locke and Rachel Wellhausen, eds (2014) Production in the Innovation Economy. Cambridge: MIT Press. IW Köln/IW Consult GmbH (2013) Industry as a Growth Engine in the Global Economy. Cologne: Business Europe. Hausmann, Richard et al. (2013) The Atlas of Economic Complexity: Mapping Paths to Prosperity, 2nd ed., Cambridge: MIT Press, plus all the related work. Dani Rodrik (2015) “Premature Deindustrialization.” Journal of Economic Growth, 21, p.1-33. https://www.imf.org/en/Publications/WEO/Issues/2018/03/20/world-economic-outlook-april-2018#Chapter%203 Hausmann, Richard and Hidalgo, Cesar (2010) Country Diversification, Product Ubiquity, and Economic Divergence, Working Paper No 201, Centre for International Development, Harvard University. WEF System Initiative on Shaping the Future of Digital Economy and Society Digital Transformation. Initiative Maximizing the Return on Digital Investments. Dani Rodrik (2015) ibid. Williamson, John (2011) Trade and Poverty: When the Third World Fell Behind. Cambridge, MA: MIT Press. The Economist (2017) “Left in the lurch. Globalization has marginalized many regions in the rich world. What can be done to help them?” October 21. Daron Acemoglu and James A Robinson (2012) Why Nations Fail: The Origins of Power, Prosperity, and Poverty, New York: Crown Publishers; Mancur Olson (1982) The Rise and Decline of Nations, Yale: Yale University Press; Douglass North (1990) Institutions, Institutional Change and Economic Performance, Cambridge: Cambridge University Press; Douglass North (1989) Institutions and Economic Growth: An Historical Introduction, Paris: Elsevier; Chrysostomos Mantzavinos, Douglass North and Syed Shariq (2003) Learning, Institutions and Economic Performance, Preprints of the Max Planck Institute for Research on Collective Goods. The IMF report regarding the declining share of manufacturing jobs declare that: “This concern stems from the widely held belief that manufacturing plays a unique role as a catalyst for productivity growth and income convergence and a source of well-paid jobs for less-skilled workers” And it continues by arguing that: “Against that backdrop, this chapter aims to provide new evidence on the role of manufacturing …that a shift in employment from manufacturing to services need not hinder economy-wide productivity growth and the prospects for developing economies”. See https://www.imf.org/en/Publications/WEO/Issues/2018/03/20/world-economic-outlook-april-2018#Chapter%203 Author interviews with SMEs in manufacturing value chains. Assolombarda Confindustria, Milano Monza and Brianza (2016) The Performance of European Firms: A Benchmark Analysis A Survey on 650 European Companies in the Five most Dynamic Regions of Europe. RICERCA No4. John C. Haltiwanger, Ron Jarmin and Javier Miranda (2013) “Who Creates Jobs? Small vs. Large vs. Young”, Review of Economics and Statistics, p. 347-361. Naomi R. Lamoreaux and Kenneth L. Sokoloff, eds (2007) Financing Innovation in the United States, 1870 to Present. Cambridge: MIT Press. Rodrik, Dani (2014) “The Past, Present, and Future of Economic Growth.” In F. Allen et al., Toward a Better Global Economy: Policy Implications for Citizens Worldwide in the 21st Century. Oxford: OUP. Transcript of Larry Summers speech at the IMF Economic Forum, Nov. 8, 2013. Dani Rodrik (2009) One Economics, Many Recipes. Globalization, Institutions, and Economic Growth. Princeton: Princeton University Press. |
| URI: | https://mpra.ub.uni-muenchen.de/id/eprint/107019 |
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