The manufacturing sector contributed to growth in the 20th century, which ultimately
enhanced capabilities related to machinery and plants. However, towards the end of the 20th
century, the manufacturing sector became less prominent as a catalyst for growth as the
economy became increasingly bit-driven. A bit-driven or knowledge economy characterises
the 21st century, where economic growth is created through the expansion of ideas and the
enhancement of human capabilities (Evans, 2007). In order to analyse the requirements of
economic growth in the 21st century, I relied on the New Growth theory and the capability
approach of Amartya Sen. The capability approach reviews state policies in terms of its
impact on developing its citizens’ capabilities, for instance, the ability to choose amongst
Information and Communications Technology (ICT) courses at universities (Sen, 1990: 49).
South Africa has several policies in place which acknowledge the importance of a
knowledge-based economy. It has also referred to the efforts of the African National
Congress (ANC) to build a Developmental State (DS). This research examined several policies
aimed at creating a 21st century DS and asks whether they enhance the capabilities of
citizens to partake in the knowledge economy.
This paper looked at development during the industrialisation period (specifically after
World War II). Here, economic growth was propelled through manufacturing. I drew on
specific countries’ experiences such as Japan, Korea and Taiwan, which were 20th century
DSs. However, as the 21st century approached, the industrial revolution was replaced with a
knowledge-based economy (KBE). The 20th and 21st century DSs are linked in that the
manufacturing sector in the latter DS needs the services sector as a catalyst for job creation
and economic growth. Therefore the manufacturing industry needs to diversify to include
the services sector (Zalk, 2014).