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Industrial Catching Up in the Poor Periphery 1870-1975

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  • Jeffrey G. Williamson

Abstract

This paper documents industrial output and labor productivity growth around the poor periphery 1870-1975 (Latin America, the European periphery, the Middle East, South Asia, Southeast Asia and East Asia). Intensive and extensive industrial growth accelerated there over this critical century. The precocious poor periphery leaders underwent a surge and more poor countries joined their club. Furthermore, by the interwar the majority were catching up on Germany, the US and the UK, a process that accelerated even more up to 1950-1975. What explains the spread of the industrial revolution world-wide and this catching up? Productivity growth certainly made their industries more competitive in home and foreign markets, but other forces mattered as well. A falling terms of trade raised the relative price of manufactures in domestic markets, as did real exchange rate depreciation. In addition, increasingly cheap fuel and non-fuel intermediates from globally integrating markets seems to have taken resource advantages away from the European and North American leaders, and integrating world financial markets also reduced the cheap capital advantage of the leaders. However, ever-cheaper labor was not a serious cause of industrial catch up, offering little support for the Krugman-Venables (1995) model. Furthermore, tariffs did not foster industrial catch up either, but rather poor industry performance fostered high tariffs. Markets and policies mattered, not just institutions.

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  • Jeffrey G. Williamson, 2011. "Industrial Catching Up in the Poor Periphery 1870-1975," NBER Working Papers 16809, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:16809
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    Cited by:

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    2. Emanuele Felice & Josep Pujol Andreu, 2013. "GDP and life expectancy in Italy and Spain over the long-run (1861-2008): insights from a time-series approach," UHE Working papers 2013_06, Universitat Autònoma de Barcelona, Departament d'Economia i Història Econòmica, Unitat d'Història Econòmica.
    3. Cristiano Antonelli & Nicola Crepax & Claudio Fassio, 2013. "The cliometrics of academic chairs. Scientific knowledge and economic growth: the evidence across the Italian Regions 1900–1959," The Journal of Technology Transfer, Springer, vol. 38(5), pages 537-564, October.
    4. Cristián Ducoing & José Peres-Cajías & Marc Badia-Miró & Ann-Kristin Bergquist & Carlos Contreras & Kristin Ranestad & Sara Torregrosa, 2018. "Natural Resources Curse in the Long Run? Bolivia, Chile and Peru in the Nordic Countries’ Mirror," Sustainability, MDPI, vol. 10(4), pages 1-25, March.
    5. Jose Peres Cajias & Marc Badia-Miro & Anna Carreras-Marin, 2012. "Intraregional trade in South America, 1913-50. Economic linkages before institutional agreements," Working Papers in Economics 270, Universitat de Barcelona. Espai de Recerca en Economia.
    6. Marc Badia-Miró & Cristián A. Ducoing, 2014. "The long run development of Chile and the Natural Resources curse. Linkages, policy and growth, 1850-1950," UB Economics Working Papers 2014/318, Universitat de Barcelona, Facultat d'Economia i Empresa, UB Economics.
    7. Felice, Emanuele & Carreras, Albert, 2012. "When did modernization begin? Italy's industrial growth reconsidered in light of new value-added series, 1911–1951," Explorations in Economic History, Elsevier, vol. 49(4), pages 443-460.
    8. Emanuele Felice & Albert Carreras, 2012. "The roots of success: industrial growth in Italy reconsidered, 1911-1951," UHE Working papers 2012_04, Universitat Autònoma de Barcelona, Departament d'Economia i Història Econòmica, Unitat d'Història Econòmica.

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    JEL classification:

    • F1 - International Economics - - Trade
    • N7 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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