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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:Domestic resource costs for Sudanese manufacturing industry: a preliminary analysis
Author:Umbadda, Siddiq
Year:1985
Periodical:Development and Change
Volume:16
Issue:1
Period:January
Pages:147-158
Language:English
Geographic term:Sudan
Subjects:industry
efficiency
External link:https://doi.org/10.1111/j.1467-7660.1985.tb00205.x
Abstract:The Sudanese manufacturing industry (overwhelmingly import-substituting) did not develop spontaneously but was created artificially through concessions extended to it by the government. Protection distorts relative prices of inputs and outputs and causes inefficiencies in resource allocation which entail a cost to the economy as a whole. This is because inter-sectoral and inter-industry specialization is interfered with; as a result, resources may move from low-cost to high-cost industries, resulting in what can be thought of as an excess Domestic Resource Cost (DRC) of saving or earning foreign exchange. The DRC indicates a country's comparative advantage in producing a particular commodity. The DRC can be used to measure the real cost (in terms of opportunities foregone) of protection if such a commodity is allowed to bemanufactured locally. A DRC scale may be used to shew the degree of efficiency (or inefficiency). This paper investigates this broad measure of efficiency as it pertains to the protective system prevailing in Sudan during the post-Independence period. App., notes, ref., tab.
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