The Timing of Industrialization Across Countries

Abstract

We develop a measure of the timing of industrialization, comparable across 149 countries. Defining the year of industrial transition as the year in which employment in industry exceeded that in agriculture, we identify 67 countries that industrialized between 1801 and 2005 and 82 countries that had not yet industrialized by 2005. We cross validate the data using anecdotal evidence from historians and by showing that, in a subset of countries, industrial production per capita surges around the year of industrialization. We then use the measure to investigate existing theories of industrialization. First, we find that an early transition is associated with higher income today. Second, the industrial transition is closely linked with the fertility transition. Third, early- and late-industrializers have rather similar levels of income, human capital, and structural composition. Fourth, late-comers differ from early-industrializers in terms of being more open to trade, having larger service shares, industrializing faster, experiencing higher growth rates of GDP per capita and schooling, and last by being more heterogenous along several dimensions.