Ideas to Action:

Independent research for global prosperity




June 10, 2015

Manufacturing or Services? An Indian Illustration of a Development Dilemma - Working Paper 409

Manufacturing has historically offered the fastest path out of poverty, but there is mounting evidence that this path may be all but closed to developing countries today. Some have suggested that services might provide a new path forward, while others have expressed skepticism about this claim and consequent pessimism over the future growth trajectories of developing countries. We contribute to debate this by using a multi-sector growth framework to establish five important criteria that any sector must exhibit in order to lead an economy to rapid, sustained, and inclusive development. 

Amrit Amirapu and Arvind Subramanian