IDEAS home Printed from https://ideas.repec.org/a/bla/ehsrev/v74y2021i1p60-86.html
   My bibliography  Save this article

Overcoming the Egyptian cotton crisis in the interwar period: the role of irrigation, drainage, new seeds, and access to credit

Author

Listed:
  • Laura Panza
  • Ulaş Karakoç

Abstract

After experiencing a period of spectacular growth during the late nineteenth century, the Egyptian cotton sector underwent a phase of stagnation, which was followed by a gradual and steady increase in output during the interwar period. Drawing on a new panel dataset at the province–year level, this article explores the determinants of the upturn in cotton output, running a horserace between credit, seed technology, and infrastructure. In order to address endogeneity concerns, an instrumental variable approach is adopted, using a modified version of Bartik's shift‐share instrumental variable. Our results provide supporting evidence that peasants switched to a lower‐yielding cotton variety as a response to changes in relative price. Moreover, our production function estimates show that two key factors had a positive impact on output growth: credit availability and the adoption of new cotton varieties.

Suggested Citation

  • Laura Panza & Ulaş Karakoç, 2021. "Overcoming the Egyptian cotton crisis in the interwar period: the role of irrigation, drainage, new seeds, and access to credit," Economic History Review, Economic History Society, vol. 74(1), pages 60-86, February.
    • Handle: RePEc:bla:ehsrev:v:74:y:2021:i:1:p:60-86
    DOI: 10.1111/ehr.13022
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ehr.13022
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ehr.13022?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Richard Hornbeck, 2010. "Barbed Wire: Property Rights and Agricultural Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(2), pages 767-810.
    2. Musoke, Moses S. & Olmstead, Alan L., 1982. "The Rise of the Cotton Industry in California: A Comparative Perspective," The Journal of Economic History, Cambridge University Press, vol. 42(2), pages 385-412, June.
    3. Freeman, H. A. & Ehui, Simeon K. & A. Jabbar, Mohammad, 1998. "Credit constraints and smallholder dairy production in the East African highlands: application of a switching regression model," Agricultural Economics, Blackwell, vol. 19(1-2), pages 33-44, September.
    4. Timothy J. Bartik, 1991. "Who Benefits from State and Local Economic Development Policies?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wbsle, November.
    5. Gastwirth, Joseph L, 1972. "The Estimation of the Lorenz Curve and Gini Index," The Review of Economics and Statistics, MIT Press, vol. 54(3), pages 306-316, August.
    6. Laura Panza, 2014. "De-industrialization and re-industrialization in the Middle East: reflections on the cotton industry in Egypt and in the Izmir region," Economic History Review, Economic History Society, vol. 67(1), pages 146-169, February.
    7. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The Geography of Trade and Technology Shocks in the United States," American Economic Review, American Economic Association, vol. 103(3), pages 220-225, May.
    8. Olmstead, Alan L. & Rhode, Paul W., 2008. "Biological Innovation and Productivity Growth in the Antebellum Cotton Economy," The Journal of Economic History, Cambridge University Press, vol. 68(4), pages 1123-1171, December.
    9. Hazarika, Gautam & Alwang, Jeffrey, 2003. "Access to credit, plot size and cost inefficiency among smallholder tobacco cultivators in Malawi," Agricultural Economics, Blackwell, vol. 29(1), pages 99-109, July.
    10. Ulaş Karakoç, 2018. "Industrial growth in interwar Egypt: first estimates, new insights," European Review of Economic History, European Historical Economics Society, vol. 22(1), pages 53-72.
    11. Nathan Nunn & Nancy Qian, 2014. "US Food Aid and Civil Conflict," American Economic Review, American Economic Association, vol. 104(6), pages 1630-1666, June.
    12. Fan, Shenggen & Zhang, Xiaobo, 2004. "Infrastructure and regional economic development in rural China," China Economic Review, Elsevier, vol. 15(2), pages 203-214.
    13. Panza, Laura, 2013. "Globalization and the Near East: A Study of Cotton Market Integration in Egypt and Western Anatolia," The Journal of Economic History, Cambridge University Press, vol. 73(3), pages 847-872, September.
    14. Mundlack, Yair & Larson, Donald F. & Butzer, Rita, 2002. "Determinants of agricultural growth in Indonesia, the Philippines, and Thailand," Policy Research Working Paper Series 2803, The World Bank.
    15. Laura Panza & Jeffrey G. Williamson, 2015. "Did Muhammad Ali foster industrialization in early nineteenth-century Egypt?," Economic History Review, Economic History Society, vol. 68(1), pages 79-100, February.
    16. Yousef, Tarik M., 2000. "The Political Economy of Interwar Egyptian Cotton Policy," Explorations in Economic History, Elsevier, vol. 37(4), pages 301-325, October.
    17. Beddow, Jason M. & Pardey, Philip G., 2015. "Moving Matters: The Effect of Location on Crop Production," The Journal of Economic History, Cambridge University Press, vol. 75(1), pages 219-249, March.
    18. Cihan Artunç, 2019. "Religious minorities and firm ownership in early twentieth‐century Egypt," Economic History Review, Economic History Society, vol. 72(3), pages 979-1007, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amuedo-Dorantes, Catalina & Arenas-Arroyo, Esther & Sevilla, Almudena, 2018. "Immigration enforcement and economic resources of children with likely unauthorized parents," Journal of Public Economics, Elsevier, vol. 158(C), pages 63-78.
    2. Paul Goldsmith-Pinkham & Isaac Sorkin & Henry Swift, 2020. "Bartik Instruments: What, When, Why, and How," American Economic Review, American Economic Association, vol. 110(8), pages 2586-2624, August.
    3. Gehring, Kai & Kaplan, Lennart C. & Wong, Melvin H.L., 2022. "China and the World Bank—How contrasting development approaches affect the stability of African states," Journal of Development Economics, Elsevier, vol. 158(C).
    4. Temple, Jonathan & Van de Sijpe, Nicolas, 2017. "Foreign aid and domestic absorption," Journal of International Economics, Elsevier, vol. 108(C), pages 431-443.
    5. Eric D Gould, 2019. "Explaining the Unexplained: Residual Wage Inequality, Manufacturing Decline and Low-skilled Immigration," The Economic Journal, Royal Economic Society, vol. 129(619), pages 1281-1326.
    6. Diemer, Andreas, 2023. "Divided we fall? The effect of manufacturing decline on the social capital of US communities," LSE Research Online Documents on Economics 120355, London School of Economics and Political Science, LSE Library.
    7. Samuel Bazzi & Martin Fiszbein & Mesay Gebresilasse, 2020. "Frontier Culture: The Roots and Persistence of “Rugged Individualism” in the United States," Econometrica, Econometric Society, vol. 88(6), pages 2329-2368, November.
    8. Awotide, B.A. & Abdoulaye, Tahirou & Alene, Arega & Manyong, Victor M., 2015. "Impact of Access to Credit on Agricultural Productivity: Evidence from Smallholder Cassava Farmers in Nigeria," 2015 Conference, August 9-14, 2015, Milan, Italy 210969, International Association of Agricultural Economists.
    9. Laura Panza, 2014. "De-industrialization and re-industrialization in the Middle East: reflections on the cotton industry in Egypt and in the Izmir region," Economic History Review, Economic History Society, vol. 67(1), pages 146-169, February.
    10. Xu, Minhong & Xu, Yilan, 2021. "What happens when Airbnb comes to the neighborhood: The impact of home-sharing on neighborhood investment," Regional Science and Urban Economics, Elsevier, vol. 88(C).
    11. Crawford, Rowena & Stoye, George & Zaranko, Ben, 2021. "Long-term care spending and hospital use among the older population in England," Journal of Health Economics, Elsevier, vol. 78(C).
    12. Kyle Barron & Edward Kung & Davide Proserpio, 2021. "The Effect of Home-Sharing on House Prices and Rents: Evidence from Airbnb," Marketing Science, INFORMS, vol. 40(1), pages 23-47, January.
    13. Cem Özgüzel, 2021. "The Cushioning Effect of Immigrant Mobility," CESifo Working Paper Series 9268, CESifo.
    14. Amuakwa-Mensah, Salome & Surry, Yves, 2022. "Association between rural electrification and agricultural output: Evidence from Sub-Saharan Africa," World Development Perspectives, Elsevier, vol. 25(C).
    15. Carter, Patrick & Van de Sijpe, Nicolas & Calel, Raphael, 2021. "The elusive quest for additionality," World Development, Elsevier, vol. 141(C).
    16. Andreas Fuchs & Hannes Öhler, 2021. "Does private aid follow the flag? An empirical analysis of humanitarian assistance," The World Economy, Wiley Blackwell, vol. 44(3), pages 671-705, March.
    17. Cem Özgüzel, 2020. "The Cushioning Effect of Immigrant Mobility: Evidence from the Great Recession in Spain," Working Papers halshs-03000365, HAL.
    18. Enrico Moretti, 2014. "Local Economic Development, Agglomeration Economies, and the Big Push: 100 Years of Evidence from the Tennessee Valley Authority," The Quarterly Journal of Economics, Oxford University Press, vol. 129(1), pages 275-331.
    19. Partridge, Mark D. & Rickman, Dan & Olfert, M. Rose & Tan, Ying, 2013. "International Trade and Local Labor Markets: Are Foreign and Domestic Shocks Created Differently?," MPRA Paper 53407, University Library of Munich, Germany.
    20. Francesco Vona & Giovanni Marin & Davide Consoli & David Popp, 2018. "Environmental Regulation and Green Skills: An Empirical Exploration," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 5(4), pages 713-753.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ehsrev:v:74:y:2021:i:1:p:60-86. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/ehsukea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.