International Journal of Applied Institutional Governance (ISSN: 1747-6259) Volume 1 Issue 2
Andrew L S Goh
Industrial development constitutes a major objective of economic strategy and government policy. Through industrial developmental efforts, developing countries aspire to attain higher levels of economic performance. However, despite having enacted industrial policies to stimulate economic growth, it remains doubtful whether the approach of industrial policy-making in these countries has indeed succeeded in transforming their economies. Although policy critics, industrial economists and technocrats are in support of government-facilitated industrial development, the debate on effective industrial policy remains largely confined to issues pertaining to improving costs of production and factors of efficiency. Yet, several lessons can be drawn from the experience of the developed world. This paper argues that industrial policy, to be truly effective in the new global world, must address the pursuit of innovation in transiting into a knowledge economy. It further outlines the role of governmental facilitation in implementing an innovation-driven industrial policy as a prime mover for economic development. Finally, it provides a context of Singapore’s industrial policy in relation to how it has helped build the nation’s economy centred on innovation.
Keywords: Industrial policy, policy-making, knowledge economy, innovation, industrial growth, innovation-driven knowledge economy and economic competitiveness