Trade, Structural Transformation and Development: Evidence from Argentina 1869-1914

Pablo Fajgelbaum () and Stephen Redding

No 20217, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We provide new theory and evidence on the role of external and internal integration in structural transformation and economic development using Argentina’s integration into the world economy in the late-19th century. Our theoretical model provides microfoundations for a spatial Balassa-Samuelson effect, in which locations closer to world markets have higher population densities, urban population shares, relative prices of non-traded goods, and land prices relative to wages, and specialize in transport-cost-sensitive traded goods. We estimate the model’s parameters, provide evidence in support of this spatial Balassa-Samuelson mechanism, and find substantial effects of both external and internal integration on economic development.

JEL-codes: F11 F14 O13 O14 (search for similar items in EconPapers)
Date: 2014-06
New Economics Papers: this item is included in nep-his and nep-ure
Note: ITI
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Citations: View citations in EconPapers (33)

Published as Pablo Fajgelbaum & Stephen J. Redding, 2022. "Trade, Structural Transformation, and Development: Evidence from Argentina 1869–1914," Journal of Political Economy, vol 130(5), pages 1249-1318.

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Journal Article: Trade, Structural Transformation, and Development: Evidence from Argentina 1869–1914 (2022)
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