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Activation of a Modern Industry

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  • Danyang Xie
  • Ping Wang

Abstract

This paper constructs an integrated framework to disentangle the underlying economic mechanism of industrial transformation. We consider three essential elements for the analysis: skill requirements, industry-wide spillovers, and degrees of consumption subsistence. We find that human and nonhuman resources, production factor matching, and industrial coordination are all important for activating a modern industry. In the process of industrial transformation, job destruction may exceed job creation, and income distribution may get worse immediately following the activation of a modern industry. An array of policy prescriptions for advancing a poor country is provided.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 02/15.

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Length: 17
Date of creation: 01 Jan 2002
Date of revision:
Handle: RePEc:imf:imfwpa:02/15

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Keywords: Spillovers; skilled labor; unemployment; skilled workers; employment; unemployment rate; total unemployment; income distribution; full employment; political economy; unskilled labor; competition framework; perfect competition; international trade; metal products; endogenous growth theory; loss of employment; endogenous growth; factor price equalization; market equilibrium; unskilled workers; job creation; world economy; retraining; factor price; employment in industry;

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References

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Citations

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Cited by:
  1. Dennis Tao Yang & Xiaodong Zhu, 2009. "Modernization of Agriculture and Long-Term Growth," Working Papers, University of Toronto, Department of Economics tecipa-376, University of Toronto, Department of Economics.
  2. Chong-Kee Yip & Tsz-Nga Wong, 2014. "A Model of Technology Assimilation," 2014 Meeting Papers, Society for Economic Dynamics 144, Society for Economic Dynamics.
  3. Yuki, Kazuhiro, 2008. "Sectoral Shift, Wealth Distribution, And Development," Macroeconomic Dynamics, Cambridge University Press, Cambridge University Press, vol. 12(04), pages 527-559, September.
  4. Trindade, Vitor, 2005. "The big push, industrialization and international trade: The role of exports," Journal of Development Economics, Elsevier, Elsevier, vol. 78(1), pages 22-48, October.
  5. Daido, Kohei & Tabata, Ken, 2013. "Public infrastructure, production organization, and economic development," Journal of Macroeconomics, Elsevier, Elsevier, vol. 38(PB), pages 330-346.
  6. Ceyhun Elgin, 2010. "A Theory of Economic Development with Endogenous Fertility," Working Papers, Bogazici University, Department of Economics 2010/06, Bogazici University, Department of Economics.
  7. Yuki, Kazuhiro, 2012. "Education, inequality, and development in a dual economy," MPRA Paper 39062, University Library of Munich, Germany.
  8. Chang, Ming-Jen & Wang, Ping & Xie, Danyang, 2011. "The dynamic process of economic takeoff and industrial transformation," MPRA Paper 31868, University Library of Munich, Germany.

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