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Industrial policy and the great divergence

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  • Reka Juhasz
  • Claudia Steinwender

Abstract

We discuss recent work evaluating the role of the government in shaping the economy during the long 19th century, a practice we refer to as industrial policy. We show that states deployed a vast variety of different policies aimed at, primarily, but not exclusively, fostering industrialization. We discuss the thin, but growing literature that evaluates the economic effects of these policies. We highlight some fruitful avenues for future study.

Suggested Citation

  • Reka Juhasz & Claudia Steinwender, 2023. "Industrial policy and the great divergence," CEP Discussion Papers dp1949, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp1949
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    References listed on IDEAS

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    1. Sascha O. Becker & Ludger Woessmann, 2009. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 531-596.
    2. Pablo Fajgelbaum & Stephen J. Redding, 2022. "Trade, Structural Transformation, and Development: Evidence from Argentina 1869–1914," Journal of Political Economy, University of Chicago Press, vol. 130(5), pages 1249-1318.
    3. Liu, Cong, 2020. "The Effects of World War I on the Chinese Textile Industry: Was the World’s Trouble China’s Opportunity?," The Journal of Economic History, Cambridge University Press, vol. 80(1), pages 246-285, March.
    4. Brian D. Varian, 2023. "British exports and foreign tariffs: Insights from the Board of Trade's foreign tariff compilation for 1902," Economic History Review, Economic History Society, vol. 76(3), pages 827-843, August.
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    More about this item

    Keywords

    industrial policy; first wave of globalization; industrialization; infant industry protection; technology policy; transport infrastructure; telegraph; 19th century;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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