ESID Working Paper No. 143 The political economy of automotive industry development policy in middle income countries: A comparative analysis of Egypt, India, South Africa and Turkey Anthony Black,1 Pallavi Roy,2 Amirah El-Haddad3 and Kamil Yilmaz4 May 2020 1 University of Cape Town Email correspondence:
[email protected] 2 SOAS, University of London Email correspondence:
[email protected] 3 German Development Institute, Bonn Email correspondence:
[email protected] 4 Koç University, Istanbul Email correspondence:
[email protected] ISBN: 978-1-912593-53-8 email:
[email protected] Effective States and Inclusive Development Research Centre (ESID) Global Development Institute, School of Environment, Education and Development, The University of Manchester, Oxford Road, Manchester M13 9PL, UK www.effective-states.org The political economy of automotive industry development policy in middle income countries: A comparative analysis of Egypt, India, South Africa and Turkey Abstract This paper examines the political economy of development policy through the prism of four country case studies (Egypt, India, South Africa and Turkey) of the automotive industry. The objective is not simply to examine the developmental impact of automotive policy, but to illustrate how the policy regime has been the outcome of a contested process. Early growth in the auto sector in the four case countries was enabled by rents from protected markets. The emergence of competitive firms is critically dependent on the nature of state–business relationships and the net outcome of the rent-seeking process in the sector. This hinges on the bargaining power of business, foreign or domestic, vis à vis the government.