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DP2523
Industrial Employment, Investment Equipment and Economic Growth
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Publication Date:
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August 2000
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Link to this Page:
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www.cepr.org/pubs/dps/DP2523.asp
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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.
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