Stages of diversification

Jean Imbs, Romain Wacziarg

Research output: Contribution to journalReview article

Abstract

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.

Original languageEnglish (US)
Pages (from-to)63-86
Number of pages24
JournalAmerican Economic Review
Volume93
Issue number1
DOIs
StatePublished - Mar 1 2003

ASJC Scopus subject areas

  • Economics and Econometrics

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