Escaping the middle-income country trap: targeted and pragmatic policies for technological upgrading and worker-inclusive industrial strategies as drawn from firm-level analysis of the Philippines and Thailand.
04 / 2011 - 04 / 2015
Competitiveness policies, largely motivated by what is known about the macroeconomic/institutional and sectoral effects of globalization, typically generate a daunting and uncontextualized policy agenda that falls short of practicability. The main goal of the programme is to develop and pilot a new policy-formulation/implementation process driven by public-private partnerships (PPPs), which addresses the middle-income country trap (MICT) through a comprehensive and multidisciplinary analysis of: 1)the micro-conditions of export performance, firm adjustment and upgrading patterns; 2)the organization and governance of global value chains (GVCs); and 3)labour-related adjustment issues. It recognizes the essential roles of government, firms, workers, and also of foreign lead firms whose positive contribution can be encouraged especially in the area of technological access and diffusion. Driven by a continuous cycle of stakeholder consultation and quality research, the programme aims for pragmatic, context-specific, and worker-inclusive strategies to empower local enterprises through greater technological learning within GVCs and create channels of diffusing know-how among non-GVC firms. The programme contains three components: 1)a comprehensive firm-survey in the Philippines and Thailand for an in-depth analysis of the micro indicators and determinants of the MICT; 2)a case study of two socio-politico economic administrative areas, CALABARZON in the Philippines and Samutprakan in Thailand, to probe into the a) adjustment strategies adopted by sample firms (within&/outside export processing zones, EPZs) in response to global changes and their effects on the labour market; b)gendered impact of such adjustments on workers and their households; and c) factors that facilitate or constrain the capacity of firms to adapt to globalization and upgrade technologically. Linking firm, worker and household data will provide some evidence of the impact of globalization (and of EPZs) on poverty. This will also guide the selection of firms for an in-depth exploration (quantitatively and qualitatively) of the social, political and economic factors?including their links to lead firms and organizational culture?that enable them to thrive despite the vagaries of the market; 3) a Chains-for-Change (C4C) CALABARZON pilot project that aims to stimulate and support private-public partnerships (PPPs) among government, civil society, and firms. From the inputs of component 2, the C4C project will allow stakeholders in PPPs to implement concrete initiatives in key areas where the resources of all actors could have direct and high impact. It aims to develop novel methods that can be introduced on a greater scale, and eventually feed into high-level and nationwide policy formulation regarding competitiveness and worker-inclusive growth.