Role of industrialization in an economy

Positive roles/advantages/benefits/merits /need for industrialization in less developed countries

• Creates jobs in the country
• Promotes innovation, and technological advancement
• Leads development of infrastructures such as roads and power distribution.
• Promotes scientific research
• Provision of a wide range of commodities. The existence of both processing and manufacturing industries tend to produce diversity of products
• Increases government revenue through taxed to the firm and salaries of employees.
• Encourage development of skills such as managerial skills.
• Minimize rural—urban migrations especially those located in rural areas.
• Sources of foreign exchange from exports
• Provision markets to raw materials especially agricultural produces.
• Strengthening international relations due to free participation of foreigners.

Negative effects/disadvantages/demerits of industrialization in less developed countries

• social overheads such as pollution, noises
• Encourage rural-urban migration since most of the industries are located in urban areas.
• Profit repatriation since most of the medium and large industries are owned by foreigners in developing countries
• Increases the external resource dependence on imported raw materials and machinery.
• Accelerate unemployment problem since large-scale industries are capital intensive.
• Increases the external resource dependence on imported raw materials and machinery.
• Accelerate unemployment problem since large-scale industries are capital intensive.
• Promote regional unbalanced development because most industries are concentrated in urban areas
• Promote income inequality because only minority of the population is engaged highly paying industrial sector leaving most population in a poorly paying agricultural sector.