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How could Industrial Structure Guide the Choice of Development Strategy? A Field of Influence Analysis for the Democratic Republic of Congo

  • Christian OtchiaEmail author
Article

Abstract

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 words

Field of Influence Social Accounting Matrix Key Sectors Economic Landscape Democratic Republic of Congo 

JEL Classification

C67 D57 O21 O25 

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Notes

Acknowledgments

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.

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Copyright information

© Japan Economic Policy Association (JEPA) 2013

Authors and Affiliations

  1. 1.Graduate School of International DevelopmentNagoya University Furo-choChikusa-ku, NagoyaJapan

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