scholarly journals Dynamics of Change in Pakistan's Large-Scale Manufacturing Sector

1985 ◽  
Vol 24 (3-4) ◽  
pp. 463-478 ◽  
Author(s):  
Usman Afridi

Examination of structural change at the sectoral level, i.e. relationship between agriculture, manufacturing and services, is a familiar exercise. However, limited attention Is paid to a detailed examination of the dynamics of structural change, particularly in the manufacturing sector. Possibly, inadequate data, coupled with a limited industrial base, have not generated sufficient interest for examining the structural changes within the manufacturing sector. We have a tendency to treat the manufacturing sector either at an aggregate macro level or at a very limited level covering only a few industries. The limitations responsible for this approach are understandable and by no means overcome. However, since with time the industrial base in Pakistan has widened and the data provided by the Census of Manufacturing Industries improved, though by no means perfected, it is time for greater emphasis on studying the dynamics of the manufacturing sector to get a deeper understanding of its behaviour, trends and directions. This study is a limited effort in that direction.

After the economic reforms of July 1991, the process of structural change led to jumping from the primary sector of the economy to tertiary by surpassing the secondary sector in India and Punjab in particular. Indeed, this process led to a rapid decline in the capacity of the manufacturing sector to offer jobs and the limited scope of the modern services sector to absorb relatively unskilled labour that was displaced from agriculture, which resulted in uneven growth of the economy, and increased unemployment. The study analysed these structural changes and its implications on the growth of production and employment of the manufacturing sector in Punjab. It was found that since the 1990s, the growth of manufacturing sector in Punjab was stagnant, whereas the trends in production and employment were declining. So, to achieve the optimum level of employment opportunities and mitigate the current crisis looming in the state of Punjab, there is a need to design a mechanism for encouraging investments in manufacturing sector particularly, in small scale industries as these industries have a greater advantage over medium/large scale units, because it uses local inputs, creates more employment opportunities and needs less start-up capital than the latter.


1978 ◽  
Vol 17 (1) ◽  
pp. 99-108
Author(s):  
Ole David Koht Norbye

In the Spring 1976 issue, The Pakistan Development Review published an article by A. R. Kemal [2] on "Consistent Time Series Data Relating to Pakistan's Large-Scale Manufacturing Industries" (hereafter referred to as Kemal I). That article was followed by a second article [3] in the Winter 1976 issue of the same journal, entitled "Sectoral Growth Rates and Efficiency of Factor Use in Large-Scale Manufacturing Sector in West Pakistan" (here¬after referred to as Kemal II). These two articles had very significant impact because they purport to present more realistic figures describing the development of Pakistan's large-scale manufacturing sector during the period 1959-1960 to 1969-1970. This was a period in which that sector grew rapidly and was subject to strong structural changes. Fresh data for the large-scale manufacturing sector during that critical period could therefore lead to a reinterpretation of Pakistan's economic history during the 1960's. The purpose of the two Kemal articles appears to have been to provide such a new statistical picture for large-scale manufacturing, and the study on which they were based was financed by the Planning Commis¬sion, Government of Pakistan.


2010 ◽  
Vol 49 (4II) ◽  
pp. 705-718 ◽  
Author(s):  
Azad Haider

The present paper discuss the nature of structural changes in employment to understand jobless growth in Pakistan for the period spanning over 1967-2008. In our work (elsewhere)1 analysing Pakistan at sectoral level to find underlying factors generating jobless growth, we found that Jobless growth in manufacturing sector was anticipated. Industrial sector has a significant importance in any economy across the glob. Recent changes in the use of capital—based foreign technology has resulted in substitution of labour with non-labour inputs such as capital. Employment shifts between industrial sectors are often witnessed as indicators of Structural change in an economy. In this paper we are more interested in the nature of structural change that took place in Pakistan economy over 1967-2008. We set to analyse four commonly used measures of sectoral reallocation proposed by Lilien (1982), Groshen and Potter (2003), Rissman (1997), and Aaronson, Rissman and Sullivan (2004). Findings of our work are suggesting that the economy of Pakistan underwent structural change during periods of recession and recovery. However, it does appear that structural changes were more pronounced at the time of 1969 recession than that of 1991 recession. A plausible explanation for this result might be significant shifts in employment from agriculture towards services sectors. We conclude, based on the evidence from our study, that sectoral reallocation is one of the major causes of jobless growth in Pakistan.


2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shromona Ganguly

PurposeThis article analyses the structural change in microenterprises located at India's unorganised manufacturing sector in terms of output mix, choice of technique and productivity during the last few decades.Design/methodology/approachBased on data collected from a quinquennial survey of unorganised firms, this study attempts productivity analysis by using the growth accounting technique.FindingsThe paper finds that there is a significant structural change which has occurred in the small firm sector in Indian manufacturing. The share of capital-intensive industries has increased substantially in recent years. Further, though small firms are more labour intensive, the labour productivity and total productivity of these firms are very low. The falling labour productivity and rising capital intensity indicates replacement of labour with capital in Indian small firm sector.Practical implicationsLow productivity of the sector is a cause for concern and this needs to be addressed by making the sector more competitive in the world market. To achieve this, policies should be designed so that small firms reach the efficient scale of production.Originality/valueThis is the first paper which examines structural changes in the Indian MSME sector. The findings have strong implications for creation of a viable ecosystem of entrepreneurship in the country.


2013 ◽  
Vol 655-657 ◽  
pp. 2284-2287
Author(s):  
Lin Jiang ◽  
Wei Dou ◽  
Ya Qiong Pan

Construction of the regional industrial competitiveness coefficient model to measure and evaluate the dynamic trend of industrial transfer between the manufacturing industries of the eastern, central and western regions since its formal implementation of the western development strategy in 1999, China, the results show that from 2000 to 2010 the absolute superiority of the eastern part of the manufacturing sector is still obvious, even to expand, and the East Midwest gap has not narrowed, as well as the expansion of large-scale industrial transfer and did not happen.


2022 ◽  
Vol 42 (1) ◽  
pp. 244-255
Author(s):  
GIULIO GUARINI ◽  
JOSÉ LUIS OREIRO

ABSTRACT Article aims to integrate New Developmentalism with Ecological View by means of the concepts of Ecological Structural Change (ESC) and Eco-Developmental Class-Coalition (EDCC). ESC means to increase the share of green manufacturing sector in GDP and employment for increasing the environmental efficiency of the economy. Exchange rate overvaluation caused by Dutch disease and growth with foreign savings can harm green manufacturing industries even more than brown manufacturing industries. ESC needs the existence of an EDCC that can be made difficult to occur if exchange rate over-valuation is not removed through taxes over commodities exports, capital controls and a dual mandate for the Central Bank.


1974 ◽  
Vol 13 (1) ◽  
pp. 1-12
Author(s):  
A. R. Kemal

Over the period 1949/50 to 1970/71, Pakistan's large-scale manufacturing sector grew at a compound rate of more than 15 per cent. Its share of GNP increased during this period from 1.5 per cent to 9.4 per cent. Various factors contributed to this growth, not the least of which were the various incentives provided to the manufacturing sector via tariffs, restrictive import licensing, tax holidays and an overvalued official exchange rate. Recently, several studies, and most notably an OECD study by Little, Scitovsky and Scott [10] (hereafter referred to as LSS) questioned the meaning of the growth rates and sectoral shares of manufacturing sector when the goods produced in these sectors are valued at prices distorted by various subsidy and trade restricting policies. They concluded that a better measure of the manu¬facturing sector's contribution could be obtained by valuing a country's gross national product not at domestic prices but at world prices—i.e. the prices that would obtain in the country were there no trade tax or quotas.


2019 ◽  
Vol 23 (4) ◽  
Author(s):  
Harutaka Takahashi ◽  
Kansho Piotr Otsubo

Abstract In the present study, we set up a continuous-time two-sector optimal growth model with services and manufacturing goods and then examine structural change: the rapid growth of the service sector. Earlier studies of structural changes can be separated into two categories: preference-driven and technology-driven. Here we introduce a new and distinct category of structural change: consumption externality identified as rise of the living standard. A key assumption is that (1) a representative consumer has a non-homothetic Stone–Geary type utility function with respect to manufacturing goods and that (2) its subsistence level will be regarded as the standard of living and will be affected by the average consumption of manufacturing goods, which also affects the consumption level of services. We also assume that the manufacturing sector is more capital-intensive than the service sector, which takes an important role in our proofs. Results show that a steady state equilibrium exists that is globally stable as well as saddle-point stable. Then, given certain production parameters in a steady state, there exists optimal steady state where the value-added and employment shares by service sector will dominate those of the manufacturing sector under the condition that external effects of the service sector dominates capital-intensity effect of the manufacturing sector. In other words, through the transition process, the service sector will dominate the manufacturing sector in the steady state.


1986 ◽  
Vol 25 (4) ◽  
pp. 649-670
Author(s):  
Aftab Ali Syed

Input-Output (1-0) tables of Pakistan's economy for the year 1975-76 were published by the Pakistan Institute of Development Economics (PIDE) in 1983. They delineated the structure of production of 118 industries together with the disposition of their output by five categories of final demand: consumption expenditures; gross fixed capital formation; changes in stocks; exports; and re-exports. Import have been shown to be absorbed as intermediate inputs as well as destined for final consumption. The present author presented an analytical paper [3], based on the said data-base, in which despite the useful industrial details captured, the predominant agrarian nature of Pakistan's economy was emphasized. Agricultural sector's contribution to the total gross domestic product (CDP) at factor cost amounted to 22.1 percent. Although the 1-0 tables identified some 81 manufacturing industries - both large-scale and small-scale - there were only seven industries whose contribution to the total CDP was of any significance. The manufacturing sector, as a whole, contributed only about 11.7 percent of the total CDP. Service industries, construction and the like still account for the rest of the CDP.


2020 ◽  
Author(s):  
Asim Iqbal ◽  
Rana Tahir Naveed ◽  
Ahmad Mohmad Albassami ◽  
MahsaMoshfegyan

The manufacturing sector has played a pivotal role for the development of the economies. It generates jobs, earn foreign reserves by exports and serves domestic economy as well. Given the importance of manufacturing sector, the performance measurement of this sector has been the main interest of economists, researchers and policymakers. The objective of the present study is to measure the performance of small, medium and large scale manufacturing industries. We utilized non-parametric approach to measure the performance by using survey panel data during 1995-2005. Further, for hypotheses testing, we use bootstrapping approach to test the null of insignificant change in the performance measures. We found that small and large scale manufacturing industries do not significantly change their technological frontier during the study period, while, both are highly efficient due to the better operation and management. Further, for high efficiency, the contribution of scale efficiency is larger as compare to the operation and management in case of large scale manufacturing industries. On the other hand, medium scale industries significantly shifted their technological frontier and adopted new technology or innovations, this sector is also efficient due to the better operation and management. However, the performance of all these manufacturing industries in terms of productivity change is not satisfactory. We conclude that by and large, the manufacturing industry has been endeavoring to improve its efficiency by expanding production with the help of available resources and administrative strategies. The conspicuous element is that the firms are reluctant to put resources into R&D which can shift production frontier upward. Keywords: Small, Medium and Large manufacturing, Performance, DEA, Bootstrapping, Punjab


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