Stages of Diversification
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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.
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This tendency has led to the neglect of the impacts that changes in demand have on different sectors and on different countries in terms of diversification, specialization and restructuring.
“This tendency, in turn, has led to the neglect of the impacts that changes in demand (sometimes deliberately managed by the government) have on different sectors and on different countries in terms of diversification, specialization and restructuring (Imbs and Wacziarg, 2003).”
From Industrial Policy in the 21st Century (2020) · cites this paper as Imbs and Wacziarg, 2003
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Industrial Policy in the 21st Century
Chang, H., & Andreoni, A. (2020) · Development and Change · doi:10.1111/dech.12570 · Cited by 455 · see citing works
- Authors
- Imbs, J., & Wacziarg, R.
- Affiliations
- Centre for Economic Policy Research (GB)
- National Bureau of Economic Research (US)
- Venue
- American Economic Review
- Publisher
- American Economic Association
- Published
- 2003-02-01
- Volume
- 93
- Issue
- 1
- Pages
- 63-86
- ISSN
- 0002-8282 (ISSN-L)
- OpenAlex
- W2767682255
- Cited by
- 1,568
- References
- 0
- Citations by year
- 2026: 47 · 2025: 49 · 2024: 55 · 2023: 88 · 2022: 78 · 2021: 87 · 2020: 95 · 2019: 90 · 2018: 82 · 2017: 90 · 2016: 88 · 2015: 80 · 2014: 81 · 2013: 89 · 2012: 73
- FWCI
- 98.56
- Type
- journal article
- Language
- en
- Open access
- green
- doi.org
- Locations
- American Economic Review (publishedVersion)
- SSRN Electronic Journal (acceptedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- OpenGrey (Institut de l'Information Scientifique et Technique) (submittedVersion)
- HAL (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic and Technological Innovation
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Economic Theory and Policy
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
- Keywords
- sectoral concentration, economic diversification, economic specialization, per capita income, economic development stages, trade theory, growth theory, sectoral composition of output
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