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  • Writer's pictureKayleanna Giesinger

Economic Development and the Textile Industry

A Masters of Economic Development Research Paper


The textile industry has gone through a shift from the global west to the global east. Despite this shift in manufacturing, predominate consumption of the fast-fashion textiles have remained in the global west. Multiple studies state the economic growth benefits related to the countries where manufacturing exists. However, certain human health violations within the labour conditions suggest that textile manufacturing does more harm in the community than good. The research discussed in this report aims to explore the concepts of economic development and economic growth concerning the textile industry and answer the question; does the textile industry cause positive economic development in communities where manufacturing takes place?

This paper compares both sides of the argument through two analysis techniques. The first is comparative data analysis on the Gross Domestic Product (GDP) and textile export rates of countries affected by trade agreements with the United States of America. The value of this is through assessing the extent of positive impacts from trade agreements on a country’s economy. The analysis was done through the use of correlation coefficients between GDP and exports, and a Wilcox Rank Sum statistical analysis. The results show that in countries where their GDP is highly correlated to their textile exports and the implementation of a trade agreement causes a significant growth in their export rates and GDP — suggesting economic benefits for countries to export textiles.

The second analysis technique was done through a historical literature review of the textile industry. Many papers published before 2000 see the textile manufacturing industry as an opportunity for catalysing economic development in communities with unskilled labour. Additionally, these same papers reinforce the value of the industry being located in an area with unskilled labour as a cost-effective option for corporations. However, a symptom of this, noted in old and new papers, is that industries will ‘location hop’ based on the most cost-effective available location. More recent papers expand on this, noting the concern of the textile industries inability to provide job security. These papers also note other human health violations that occur within the industry such as forced labour, child, labour, gender inequality and health hazards.

By considering both perspectives concerning the textile manufacturing industry, a potential is shown for the industry to benefit communities. Unfortunately, the current system neglects basic socio needs within the communities where manufacturing is situated. A new approach to the textile industry is recommended by targeting the consumer behaviour and intention gap.

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