Industrial policy impact on competitiveness of companies and sustainable development in post-communist Kazakhstan

Abstract

Industrial policy that can include industrial programs, liberalization of trade, anti-trust policy or price of capital regulation, in the context of post-communist Ka-zakhstan with its historical particularities of institutions has distinctive features. In order to develop different sectors of economy Kazakhstan government imple-mented two sequential industrial programs for 2010-2019 period. It was expected positive effect of the industrial programs and another initiatives of industrial poli-cy on survivorship of companies inside the country. However, concentration rates of companies and retailers within 20 industries that are highly dependent on indus-tries within programs, were increasing during the period of programs realization and liberalization of trade. In order to estimate which of instruments of the indus-trial policy are effective we employ logistic regression model where competitive-ness of companies is dependent on observed factors. The secondary dataset con-sists of 2271 observations at firm level obtained from Euromonitor International and official sources of Kazakhstan government. We find significant impact of Herfindahl-Hirschman index of companies and an interest rate of the National Bank of Kazakhstan on survivorship of firms rather than other instruments of in-dustrial policy in this case. The more attention the government pays to these in-struments the more companies survive.