This paper is concerned with economic developments in South Australia in the context of capital restructuring in the manufacturing sector, inter- State capital penetration and severe labour displacement. The paper discusses the advent of selective 'de-industrialisation' in this state as a feature of national and international capital restructuring. The analysis suggests that, although state policy was integrally involved in the development of the regional economy, state policy is currently faced with major structural problems to which it has few effective solutions. Indeed, the previous inability of the state apparatus to establish long-term economic policies of regional development has led to greater instability in the present crisis.
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