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Education and Catch-Up in the Industrial Revolution

  • Sascha O. Becker
  • Erik Hornung
  • Ludger Woessmann

Research increasingly stresses the role of human capital in modern economic development. Existing historical evidence -- mostly from British textile industries -- however, rejects that formal education was important for the Industrial Revolution. Our new evidence from technological follower Prussia uses a unique school enrollment and factory employment database linking 334 counties from pre-industrial 1816 to two industrial phases in 1849 and 1882. Using pre-industrial education as instrument for later education and controlling extensively for pre-industrial development, we find that basic education is significantly associated with nontextile industrialization in both phases of the Industrial Revolution. Panel data models with county fixed effects confirm the results. (JEL I20, J24, N13, N33, N63)

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Article provided by American Economic Association in its journal American Economic Journal: Macroeconomics.

Volume (Year): 3 (2011)
Issue (Month): 3 (July)
Pages: 92-126

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Handle: RePEc:aea:aejmac:v:3:y:2011:i:3:p:92-126
Note: DOI: 10.1257/mac.3.3.92
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  1. Galor, Oded, 2005. "From Stagnation to Growth: Unified Growth Theory," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 4, pages 171-293 Elsevier.
  2. Hanushek, Eric A. & Wößmann, Ludger, 2012. "Do better schools lead to more growth? Cognitive skills, economic outcomes, and causation," Munich Reprints in Economics 20400, University of Munich, Department of Economics.
  3. Goldin, Claudia D. & Katz, Lawrence F., 1998. "The Origins of Technology-Skill Complementarity," Scholarly Articles 27867130, Harvard University Department of Economics.
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  7. Sascha O. Becker & Francesco Cinnirella & Ludger Woessmann, 2009. "The Trade-off between Fertility and Education: Evidence from before the Demographic Transition," CESifo Working Paper Series 2775, CESifo Group Munich.
  8. Becker, Sascha O. & Hornung, Erik & Woessmann, Ludger, 2009. "Catch Me If You Can: Education and Catch-up in the Industrial Revolution," IZA Discussion Papers 4556, Institute for the Study of Labor (IZA).
  9. Jess Benhabib & Mark M. Spiegel, 2002. "Human capital and technology diffusion," Working Paper Series 2003-02, Federal Reserve Bank of San Francisco.
  10. Becker, Sascha O. & Wößmann, Ludger, 2007. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," Discussion Papers in Economics 1366, University of Munich, Department of Economics.
  11. Kindleberger, Charles P, 1995. "Technological Diffusion: European Experience to 1850," Journal of Evolutionary Economics, Springer, vol. 5(3), pages 229-42, September.
  12. Oded Galor & Omer Moav, 2006. "Das Human-Kapital: A Theory of the Demise of the Class Structure," Review of Economic Studies, Oxford University Press, vol. 73(1), pages 85-117.
  13. Gregory Clark, 2005. "The Condition of the Working-Class in England, 1209-2004," Working Papers 539, University of California, Davis, Department of Economics.
  14. Oded Galor & Omer Moav & Dietrich Vollrath, 2009. "Inequality in Landownership, the Emergence of Human-Capital Promoting Institutions, and the Great Divergence," Review of Economic Studies, Oxford University Press, vol. 76(1), pages 143-179.
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  16. N. F. R. Crafts, 1977. "Industrial Revolution in England and France: Some Thoughts on the Question, “Why was England First?”," Economic History Review, Economic History Society, vol. 30(3), pages 429-441, 08.
  17. Galor, Oded & Moav, Omer, 2001. "Das Human Kapital," CEPR Discussion Papers 2701, C.E.P.R. Discussion Papers.
  18. Alan B. Krueger & Mikael Lindahl, 2000. "Education for Growth: Why and For Whom?," NBER Working Papers 7591, National Bureau of Economic Research, Inc.
  19. Allen,Robert C., 2009. "The British Industrial Revolution in Global Perspective," Cambridge Books, Cambridge University Press, number 9780521868273, November.
  20. Daron Acemoglu & Simon Johnson & James A. Robinson, 2002. "Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution," The Quarterly Journal of Economics, Oxford University Press, vol. 117(4), pages 1231-1294.
  21. Ros s, Joan R., 1998. "Measuring the contribution of human capital to the development of the Catalan factory system (1830 61)," European Review of Economic History, Cambridge University Press, vol. 2(01), pages 25-48, April.
  22. Lenoir, Timothy, 1998. "Revolution from Above: The Role of the State in Creating the German Research System, 1810-1910," American Economic Review, American Economic Association, vol. 88(2), pages 22-27, May.
  23. Bessen, James, 2003. "Technology and Learning by Factory Workers: The Stretch-Out at Lowell, 1842," The Journal of Economic History, Cambridge University Press, vol. 63(01), pages 33-64, March.
  24. Easterlin, Richard A., 1981. "Why Isn't the Whole World Developed?," The Journal of Economic History, Cambridge University Press, vol. 41(01), pages 1-17, March.
  25. Sandberg, Lars G., 1979. "The Case of the Impoverished Sophisticate: Human Capital and Swedish Economic Growth before World War I," The Journal of Economic History, Cambridge University Press, vol. 39(01), pages 225-241, March.
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