Template-type: ReDIF-Paper 1.0
Author-Name: Szirmai, Adam
Author-Email: szirmai@merit.unu.edu
Author-Workplace-Name: UNU-MERIT/MGSoG, Maastricht University
Author-Name: Verspagen, Bart
Author-Email: B.Verspagen@maastrichtuniversity.nl
Author-Workplace-Name: UNU-MERIT, and School of Business and Economics,
	 Maastricht University
Title: Manufacturing and Economic Growth in Developing Countries, 1950-2005 
Abstract: Since the middle of the eighteenth century, manufacturing has functioned 
	 as the main engine of economic growth and development. However, in 
	 recent research, questions have been raised concerning the continued 
	 importance of the manufacturing sector for economic development. This 
	 paper reexamines the role of manufacturing as a driver of growth in 
	 developing countries in the period 1950-2005.  
	 The paper makes use of a newly constructed panel dataset of annual value 
	 added shares (in current prices) for manufacturing, industry, 
	 agriculture and services for the period 1950-2005. Regression analysis 
	 is used to analyse the relationships between sectoral shares and per 
	 capita GDP growth for different time periods and different groups of 
	 countries. For the total sample, we find a moderate positive impact of 
	 manufacturing on growth in line with the engine of growth hypothesis. 
	 Splitting our sample into three subperiods, we only find a direct effect 
	 of manufacturing on growth for the middle period 1970-1990. We also find 
	 interesting interaction effects of manufacturing with education and 
	 income gaps. In a comparison of the subperiods, it seems that since 
	 1990, manufacturing is becoming a more difficult route to growth than 
	 before.
Classification-JEL: O40, O14, N64
Keywords: Structural Change, Manufacturing, Engine of Growth, Catch-up
Series: UNU-MERIT Working Papers
Creation-Date: 2011
Number: 2011-069
File-URL: https://unu-merit.nl/publications/wppdf/2011/wp2011-069.pdf
File-Format: application/pdf
File-Size: 275 Kb
Handle: RePEc:unm:unumer:2011069