Stages of Diversification

This paper studies the evolution of sectoral concentration in relation to the level of per capita income. We show that various measures of sectoral concentration follow a U-shaped pattern across a wide variety of data sources: countries first diversify, in the sense that economic activity is spread...

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Bibliographic Details
Published inThe American economic review Vol. 93; no. 1; pp. 63 - 86
Main Authors Imbs, Jean, Wacziarg, Romain
Format Journal Article
LanguageEnglish
Published American Economic Association 01.03.2003
Subjects
Crop diversification
Data analysis
Datasets
Diversification
Economics
Economics and Finance
Employment
Gini coefficient
Gross domestic product
Growth theory
Humanities and Social Sciences
Income
Income estimates
Income level
Manufacturing industries
Per capita income
Point estimators
Trade theory
Specialization
International Trade
International Macroeconomics
Comparative Advantage
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Summary:This paper studies the evolution of sectoral concentration in relation to the level of per capita income. We show that various measures of sectoral concentration follow a U-shaped pattern across a wide variety of data sources: countries first diversify, in the sense that economic activity is spread more equally across sectors, but there exists, relatively late in the development process, a point at which they start specializing again. We discuss this finding in light of existing theories of trade and growth, which generally predict a monotonic relationship between income and diversification.
Bibliography:ObjectType-Article-2
SourceType-Scholarly Journals-1
ObjectType-Feature-1
content type line 23
ISSN:0002-8282
1944-7981
DOI:10.1257/000282803321455160