The Case Against Targeted Industry Strategies

Abstract

Targeted industry studies and strategies have been widely used in economic development practice since the 1970s, and their use continues to grow. In spite of their longevity, targeting as a method never has been formally or rigorously evaluated. This article looks at dozens of studies and strategies and concludes that targeting is based on poor data, unsound social science methods, and faulty economic reasoning and is largely a political activity. Targeting studies could be improved somewhat by making their methods more transparent, encouraging use of competing studies, and building in a required evaluation component.