4.3 Starting Economic Development: The Big Push

Big Push Theory

Complementary Investments

The idea that multiple industries must develop simultaneously for growth to occur (e.g., steel, transport, construction).

Industrialization Trap

A failure of industrial growth due to lack of coordination among interdependent industries.

Super-Entrepreneur Problem

The unrealistic notion that one “super-entrepreneur” could coordinate all development activities; instead, collective or government coordination is needed.

Linkages

Interconnections between industries; growth in one sector can stimulate growth in others through supply and demand chains.

Forward Linkages

When an industry’s output becomes an input for another industry (e.g., steel → machinery).

Backward Linkages

When the growth of an industry creates demand for inputs from other sectors (e.g., construction → cement).

Public Coordination Mechanisms

Government actions (e.g., infrastructure investment, incentives) that help align private sector activities.