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Deindustrialisation and re-industrialisation in the Middle East: Reflections on the cotton industry in Egypt and western Anatolia


  • Laura Panza


This paper undertakes an investigation of the process of decline and rebirth of textile manufacturing in two Middle Eastern regions, Egypt and western Anatolia during the first wave of globalisation (1850-1914). Through the application of the “Dutch Disease” model we explore the linkages between terms of trade and industrialisation. These are further related to the evolution of price transmission between domestic and global raw cotton markets. We find that different levels of market integration have contributed to diverging trajectories in industrial development in the two regions: while in Egypt the process of de-industrialisation was not reversed, in western Anatolia weaker international price transmission and domestic policy interventions facilitated the creation of a nascent domestic textile industry.

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  • Laura Panza, 2012. "Deindustrialisation and re-industrialisation in the Middle East: Reflections on the cotton industry in Egypt and western Anatolia," CEH Discussion Papers 009, Centre for Economic History, Research School of Economics, Australian National University.
  • Handle: RePEc:auu:hpaper:009

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