14 Arguments for industrial development strategy
- Industrial products fetch high and stable prices. Industrial products are free from the adverse effects of natural factors like climate and they command high prices on the international market unlike agricultural This leads to an increase in the income of the producers and better terms of trade for the country.
- It facilitates the exploitation and utilization of the idle local resources. This helps to improve on the productive capacities in the economy hence economic growth and development
- 3. It increases government revenue through taxation. Industrialization widens the tax base in form of employment opportunities created and various investments undertaken hence generating more tax revenue to the government, The revenue realized is used to construct social and economic infrastructure like hospitals, roads, schools, power plants, roads
- It leads to better standards of living. Industrialization leads to the production of a variety of high quality goods and services in the economy. This widens the choice of consumers at reduced prices hence better standards of living.
- It facilitates technological development in the country. Industrialization encourages the use of modem production techniques through inventions, innovations and technology transfer. This increases efficiency hence production of better quality goods and services.
- It improves the balance of payment position of the country. Industrialization increases the production of high quality goods and services for exports through value addition. Such goods compete favorably on the world market hence increasing the export earnings of the country. In addition, there is an increase in the production of goods and services for the domestic market. This helps the country to save the scarce foreign exchange earnings which would be used for import purposes hence better balance of payments position.
- It increases employment opportunities. This is due to increased resource utilization and a number of production and other economic activities carried out. This increases the income of the people. This is true if labour intensive techniques of production are used.
- It leads to the development of social and economic infrastructure. Industrialization promotes the development of the social and economic infrastructures in form of roads, schools, hospitals, financial institutions etc. so as to facilitate trade in the economy.
- 9. It reduces the dependence of the economy on other economies. Through import substitution strategy, a number of formally imported goods and services are produced. This leads to an increase in self-reliance and sustenance of the economy.
- It increases urbanization and monetization of an economy. This is because industrialization promotes trade and commerce in the economy.
- It promotes inter sectoral linkages in the economy especially with the agricultural sector. This is because agro-based industries provide factor inputs to the agricultural sector and market for the products from the agricultural sector in form of raw materials.
- It leads to social cultural transformation. Industrialization brings about social transformation, equitable distribution of income and balanced regional development in the process of economic development.
- It increases capital inflow in the country. This because most of the large industries are owned by foreign investors who bring in capital and efficient technology. This increases the level of investment in the country.
- It increases the GDP of the country. This is due to increased production and economic activities in the country which increases trade in the economy hence high levels of national income.
CATEGORIES Economics
TAGS Dr. Bbosa Science
