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Abstract

Much of Sub-Saharan Africa is characterised by premature deindustrialisation. In this paper, it is argued that the difficulty experienced by this region with the expansion of manufacturing is related to the fact that most of these countries are land-abundant and thus there is a comparative advantage for agriculture. An agriculture-based model of development thus is most appropriate. The expansion of agricultural production can have both direct and indirect effects on the growth of output and employment in manufacturing. The Ethiopian experience is used to illustrate these ideas. Time-series analysis indicates that agriculture has indeed played a key role in the growth of manufacturing and services.

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