'De-industrialisation' and colonial rule: The cotton textile industry in Indonesia, 1820-1941

Pierre van der Eng ()

Departmental Working Papers from Australian National University, Economics RSPAS

Abstract: Did colonial rule in Indonesia have a de-industrialising impact? Using the case of the cotton textile industry, this paper finds little evidence. Value added in the industry increased in Java during 1820-71, increased more than three-fold during 1874-1914 and doubled during 1934-41. Most activity involved finishing of imported cotton cloth. Spinning and weaving increased marginally, as high labour intensity of small-scale production, marginal local raw cotton production, and competitive international markets for yarn and cloth precluded domestic production. Unfavourable real exchange rates discouraged investment in modern spinning and weaving ventures. From 1934, production increased rapidly due to trade protection and technological change in small-scale weaving.

Keywords: Cotton textiles; manufacturing; Indonesia; trade policy; technological change (search for similar items in EconPapers)
JEL-codes: F13 L67 N65 O14 O33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev, nep-his and nep-sea
Date: 2007

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Persistent link: http://EconPapers.repec.org/RePEc:pas:papers:2007-04

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