This dissertation analyzes the relation between industrial organization, technological change and economic policy-making. The secrets to long-term growth are hidden in this complex relation, which explains the forces that enable and hinder learning in production. The recent changes in the international economy are surveyed--changes in technologies, changes in the organization of production and work and changes in the structure of firms. The resulting change in the nature of competitiveness calls for a different theoretical framework and policy recommendations from traditional economic analysis. The study reviews the problems of the liberalization paradigm in economic development. The development theories that flourished in the 1950s and 1960s provided an early basis for concern with industrialization. Nevertheless, economic development theories have underplayed the importance of technological and organizational efforts. Economic development is redefined as a combination of a learning process and innovation. In the light of these ideas, the different stages in the industrial history of Argentina are reinterpreted. The transformations that are redefining the international automobile industry are reviewed, namely, changes in production methods, technological changes, inter-firm relations and international strategies. The implications of these changes are explored for the less developed countries that aim to have a future role in the industry. A strategic sector analysis is applied to the automobile industry in Argentina. This sector is of particular interest because it was an important force driving idiosyncratic import substitution efforts in the 1960s and is a test case for incomes, trade and sector promotion and protection policies in the 1990s. Drawing on case-study evidence from plant visits, the accumulated learning and future learning potential of the sector are evaluated. This potential is examined across four dimensions: the development of strategic, organizational, technological and learning capabilities. The study concludes with a reassessment of the conventional debates in traditional theory and policy-making. It argues for the need to move away from old dichotomies which fail to address how organizational and technological change interact to contribute to long-term growth.