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Data Points: Manufacturing’s Economic Footprint

(originally published by Booz & Company)

How big a role does manufacturing play in a nation’s economic output? On average, share of GDP rises as countries move from the low to the middle stage of economic development (from “factor-driven” to “efficiency-driven,” as defined by the World Economic Forum). But as national economies evolve to the “innovation-driven” stage, manufacturing’s share tends to decline. One likely reason: Product research, engineering, and design tend to remain in developed countries, but manufacturing flows to lower-cost nations. 


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