Working Paper: NBER ID: w30874
Authors: Fabian Eckert; John Juneau; Michael Peters
Abstract: We study the joint process of urbanization and industrialization in the US economy between 1880 and 1940. We show that only a small share of aggregate industrialization is accounted for by the relocation of workers from remote rural areas to industrial hubs like Chicago or New York City. Instead, most sectoral shifts occurred within rural counties, dramatically transforming their sectoral structure. Most industrialization within counties occurred through the emergence of new "factory" cities with notably higher manufacturing shares rather than the expansion of incumbent cities. In contrast, today's shift towards services seems to benefit large incumbent cities the most.
Keywords: urbanization; industrialization; rural America; economic growth; sectoral change
JEL Codes: E0; R11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| urbanization (R11) | sectoral change (O14) |
| within-county transformations (R23) | sectoral shifts (L16) |
| new factory cities (L69) | industrialization (O14) |
| migration rates (J61) | sector switching (P23) |
| within-state component (H73) | aggregate structural change (O49) |
| decline in agricultural employment (J43) | sectoral reallocation (J69) |