Working Paper: CEPR ID: DP2523
Authors: Harris Dellas; Vally Koubi
Abstract: The industrialization of labour is the main engine of growth during the early stages of economic development. In less developed countries, equipment investment has played a less important role than non-equipment investment; and it has only proved growth enhancing when it either encountered a substantial industrial labour force or fostered a large increase in the share of industrial employment. These findings draw attention to the effects of investment on the composition of the labour force; and unlike recent claims emphasizing industrialization via equipment investment, they suggest that employment industrialization policies may hold the key to success in the LDC world.
Keywords: Economic Development; Equipment Investment; Industrial Employment; Labour Intensive Technology
JEL Codes: O14; O30; O57
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| industrial employment (L69) | economic growth (O49) |
| equipment investment (E22) | economic growth (O49) |
| high equipment investment (E22) | economic growth (O49) |
| policies promoting industrial employment (O25) | economic growth (O49) |