The Effect of Technological Changes on Work Restructuring: A Comparative Analysis of the South African and Brazilian Automotive Manufacturing Industries

Abstract

Manufacturing industries have through the history of twentieth and twenty first century development economics occupied a central role in discussions on economic development. Rosenstein-Rodan (1943) argued that the alleviation of unemployment and underdevelopment in 1940s Eastern-Europe could be brought about by a government-funded establishment of complementary manufacturing industries. Lewis (1954) posited that unemployment in developing countries can be drastically reduced with a transfer of unskilled labour from the agricultural to the more productive industrial sector. Meanwhile, the Global Value Chain (GVC) literature emerging in the 1990s and 2000s touted the possibility of development through attachment of local firms to the production networks of technologically superior ‘lead firms’, wherein they could ‘upgrade’ into more valuable products, processes, or sectors (Gereffi, 2019). Underlying the advocacy for manufacturing sectors have been economic growth models wherein the primary factor determining economic growth is the accumulation and or the increased capability of physical capital (Harrod, 1939; Solow, 1956). With concerns over the lack of convergence in the economic growth rates of ‘developed’ and ‘developing’ countries, later scholars mainly attributed long-run economic growth to investments in human, rather than just physical capital (Romer, 1989)