How could Industrial Structure Guide the Choice of Development Strategy? A Field of Influence Analysis for the Democratic Republic of Congo
The purpose of this paper is to analyse the structure of the economy of the Democratic Republic of Congo (DRC), and measure the strength of the linkages between different economic sectors. We construct a social accounting matrix for DRC, and apply the minimum information decomposition of the Leontief inverse to design appropriate development policies based on the field of influence of changes. Our findings highlight the importance of creating agricultural value chains and establishing a competitive agrofood industry in DRC. The analysis suggests that increasing value addition in and processing capacity of agricultural products will generate the most important volume change in the economy, and improving efficiency of financial intermediation will have an important additional scale effect. The findings also pinpoint the role of investment in transportation infrastructure and trade institutions in creating domestic and regional markets for competitive agrofood products. Our study further indicates that although mining is a weak sector in DRC, it remains necessary for export expansion and economic growth. From a policy standpoint, this result suggests that the creation of backward and forward linkages is essential for mining to play a major role in DRC’s industrialization.
Key wordsField of Influence Social Accounting Matrix Key Sectors Economic Landscape Democratic Republic of Congo
JEL ClassificationC67 D57 O21 O25
Unable to display preview. Download preview PDF.
I would like to express my sincere gratitude to the anonymous referees and participants in the 11th International Conference of the Japan Economic Policy Association (JEPA) at Nagoya Gakuin University, Aichi, Japan, for their helpful comments and suggestions.
- Hewings, G. J. D. and M. Sonis. 2009. Coefficient Change and Innovation Spread in Input- Output Models. Working Papers in Input-Output Economics 09-003. The International Input-Output Association.Google Scholar
- Institut National de la Statistique. 2008. Les Travaux de Comptabilité Nationale en République Démocratique du Congo. Institut National de la Statistique, Kinshasa, Democratic Republic of Congo.Google Scholar
- Kamiantako, M. 1993. The Impact of Stabilization and Structural Adjustment Policies (SSAPs) in Zaire: Analysis within a Social Accounting Matrix Framework. Visiting Research Fellow Series n°221. Institute of Developing Economies, Tokyo.Google Scholar
- Löfgren, H.; RL. Harris and S. Robinson. 2002. A Standard Computable General Equilibrium (CGE) Model in GAMS Micro Computers in Policy Research No. 5. International Food Policy research Institute, Washington DC.Google Scholar
- Pyatt, G. and J.I. Round. 1985. Social Accounting Matrices: A Basis for Planning. The World Bank, Washington D.C.Google Scholar
- Robinson, S. and M. El-Said. 2000. GAMS Code for Estimating a Social Accounting Matrix (SAM) using Cross Entropy (CE) Methods. IFPRI Discussion Paper 64. IFPRI, Washington D.C.Google Scholar
- Santos, S.. 2006. Constructing a Database for Economic Modelling from the System of National Accounts: a Social Accounting Matrix for Portugal. Ecomod 2006 Conference Paper Ecomod, Hong Kong, China.Google Scholar
- Sonis, M.; J. Guilhoto; G. J. D. Hewings and E.B. Martins. 1995. Linkages, Key Sectors, and Structural Change: Some New Perspectives. The Developing Economies XXXIII(3): 233–270.Google Scholar
- UNECA. 1984. An Aggregate Social Accounting Matrix (SAM) for Zaire, 1980: A Preliminary Report. E/ECA/PSD.3/16. UNECA, Addis Ababa.Google Scholar
- United Nations. 1993. System of National Accounts. United Nations, New York.Google Scholar
- Warr, P. and M. Azis. 1997. Indosam: A Balanced and Disaggregated 1993 Social Accounting Matrix for Indonesia. Working Paper 9706. CIES, University of Adelaide, Adelaide, South Australia.Google Scholar