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When, Where, and Why? Early Industrialization in the Poor Periphery 1870-1940

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  • Jeffrey G. Williamson

Abstract

This paper documents industrial output and labor productivity growth around the poor periphery 1870-1940 (Latin America, the European periphery, the Middle East, South Asia, Southeast Asia and East Asia). Intensive and extensive industrial growth accelerated there over these seven critical decades. There was an acceleration by the precocious leaders and more poor countries joined their club. Furthermore, many were actually catching up on Germany, the US and the UK. The paper then reports an early effort to identify the sources underlying the spread of the industrial revolution to the poor periphery. Productivity growth certainly made their industries more competitive in home and foreign markets, but other forces may have mattered more. Ever-cheaper labor gave them an edge in labor-intensive industries, increasingly cheap fuel and non-fuel intermediates from globally integrating markets appear to have taken resource advantages away from the European and North American leaders, and real exchange rate depreciation raised the price of import-competing manufactured goods at home. Tariffs helped protect the home market, but more modestly. All of this took place long before the popular post-WWII ISI strategies, especially in Latin America and Russia, where they had their origin.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 16344.

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Date of creation: Sep 2010
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Handle: RePEc:nbr:nberwo:16344

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Cited by:
  1. Agustín S. Bénétrix & Kevin H. O’Rourke & Jeffrey G. Williamson, 2012. "The Spread of Manufacturing to the Periphery 1870-2007: Eight Stylized Facts," Working Papers 0021, European Historical Economics Society (EHES).
  2. Funke, Michael & Yu, Hao, 2010. "The emergence and spatial distribution of Chinese seaport cities," BOFIT Discussion Papers 11/2010, Bank of Finland, Institute for Economies in Transition.

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