Technical Progress In The Ethiopian Manufacturing Sector Extent And Implication For Industrialization

Cognizant of the importance of technical progress in the process of industrialization, examiningrnits nature and extent in the Ethiopian manufacturing sector is essential. To this end, differentrnstatistical and econometric models are employed. Four main findings emerged in the effort.rnFirstly, the Ethiopian manufacturing sector as a whole registered a negative technical progress.rnSecondly, the production technique, in general, was capital-consuming and labour-saving,rncontrary to the theory of initial factor endowments. Thirdly, there was real sub-sectoralrndifferences; those sectors which are light and with long production experience recorded a positiverntechnical progress while others did not. Finally, the private sector, in general, appeared to bernmore effective in resource use than the public ones.rnThese results have implications for industrialization in Ethiopia. Firms should build thernnecessary technological and managerial capabilities to adapt, assimilate and modify to localrnconditions. In parallel, the government should create the conducive environment by installingrnthe appropriate capabilities, incentives and institutions, paying due attention to theirrncomplementarity.

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