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This paper aims to analyze manufacturing´s contribution to development in high-income (HIC) and middle-income countries (MIC) from 2000 to 2019, by econometrically testing the inverted-U curve hypothesis of Rowthorn (1994), Palma (2005), and Rodrik (2016). The original contribution of the analysis presented in this paper is to test the validity of this relationship for MIC and HIC by examining not the share of manufacturing in GDP (measured by value added), but the contribution of the manufacturing sector to development measured by the structural decomposition of productivity and wage growth. The paper´s main findings are: (i) the results do not indicate a decline in the contribution of manufacturing to development among middle- and high-income countries (MIC and HIC) as they attain higher levels of per capita income. In fact, across nearly all econometric specifications, no evidence of an inverted U-shaped curve was observed between the manufacturing’s contribution to development and per capita income levels, (ii) for high- and medium-tech sectors in MIC, empirical evidence suggests that the manufacturing's contribution to development increases as per capita income rises above US$8,000, (iii) the higher the tech-intensity, the more important the contribution of manufacturing to development in HIC and MIC. These findings further underscore the central role of industrial and innovation policies as essential components in fostering sustainable growth trajectories, taking into account the heterogeneity of sectors and countries, especially in the context of a techno-productive paradigm shift driven by the imperative to facilitate digital and green transitions.