Explaining declining industries in developing countries: The case of textiles and apparel in Ghana

Abstract

Although declining industries have garnered a plethora of scholarly attention, there is still a theoretical deficit in our understanding of factors that precipitate them in developing countries. This paper examines the causes of declining industries in developing countries. The paper develops an integrated framework to shed light on the subject. Using insights from the textile and apparel industries in Ghana, the study uncovered factors such as global competition, the growth of second-hand clothing and smuggling, and obsolete technologies used by firms have interacted to precipitate the incremental decline of the industries. The study outlines the important implications for theory and practice.