Stages of diversification in Africa

This paper investigates the relationship between manufatturing diversification and level of economic development for 29 African countries. Three diversification stages are identified. Considerable differences in diversification are found over the first stage at the low end of the per capita-income scale. Diversification alone will not encourage development in poorer countries until obstacles such as weak institutions, poor governance and a lack of infrastructure are addressed. Diversification slows down over the remaining stages as countries develop. Results show countries further along the African economic development path successfully diversified manufacturing. (C) 2016 Elsevier B.V. All rights reserved.