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Title: Agricultural Diversification and Development Evidence from U.S. History

Citation Type: Miscellaneous

Publication Year: 2013

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Abstract: This paper studies the long-run effects of agricultural diversification on manufacturing produc- tivity and income per capita. Evidence from United States counties shows that the structure of agricultural production at early stages of development affects the growth process. Identifica- tion of causal effects comes from a novel instrumental variable strategy that relies on natural endowments as a source of exogenous variation in agricultural diversification patterns. Accord- ing to my IV estimates, a one-standard-deviation increase in agricultural diversification in 1860 led to a 5 percentage points gain in income per capita in 2000. The positive effect of agricul- tural diversification was already present in manufacturing productivity by 1920. I conduct an exploratory assessment of different channels of causality, and find evidence pointing to human capital formation and industrial diversification.

Url: http://www.inesad.edu.bo/bcde2013/papers/BCDE2013-101.pdf

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Authors: Fiszbein, Martin

Publisher: Brown University

Data Collections: IPUMS NHGIS

Topics: Land Use/Urban Organization

Countries: United States