Industrialization without innovation

Paula Bustos (), Juanma Castro-Vincenzi, Joan Monras and Jacopo Ponticelli

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: Labor-saving technologies in agriculture cam foster structural transformation byre-leasing workers who find jobs in manufacturing. The traditional view is that factor reallocation towards manufacturing Generates innovation and productivity growth. We document, instead, that regions more exposed to a large and exogenous in-crease in agricultural productivity in Brazil industrialized but experienced lower manufacturing productivity growth. Workers released from agriculture were mostly unskilled and primarily moved to the least skill-intensive manufacturing industries. This paper explores the various Mechanisms that can account for the observed manufacturing productivity decline. Changes in worker composition and lower incentives to innovate within manufacturing play prominent roles.

Keywords: agricultural productivity; skill-biased technical change; productivity; labor mobility; genetically engineered soy; Brazil (search for similar items in EconPapers)
JEL-codes: F16 J43 O13 O14 O33 O41 (search for similar items in EconPapers)
Date: 2023-09
New Economics Papers: this item is included in nep-agr and nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Industrialization without Innovation (2024)
Working Paper: Industrialization without Innovation (2019)
Working Paper: Industrialization without Innovation (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:1888

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