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Technology Adoption and Productivity Growth: Evidence from Industrialization in France

Author

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  • Squicciarini, Mara
  • Juhász, Réka
  • Voigtländer, Nico
Abstract
New technologies tend to be adopted slowly and - even after being adopted - take time to be reflected in higher aggregate productivity. One prominent explanation for these patterns is the need to reorganize production, which often goes hand-in-hand with major technological breakthroughs. We study a unique setting that allows us to examine the empirical relevance of this explanation: the adoption of mechanized cotton spinning during the First Industrial Revolution in France. The new technology required reorganizing production by moving workers from their homes to the newly-formed factories. Using a novel hand-collected plant-level dataset from French archival sources, we show that productivity growth in mechanized cotton spinning was driven by the disappearance of plants in the lower tail - in contrast to other sectors that did not need to reorganize when new technologies were introduced. We provide evidence that this was driven by the need to learn about optimal ways of organizing production. This process of ‘trial and error’ led to initially low and widely dispersed productivity, and - in the subsequent decades - to high productivity growth as knowledge diffused through the economy and new entrants adopted improved methods of organizing production.

Suggested Citation

  • Squicciarini, Mara & Juhász, Réka & Voigtländer, Nico, 2020. "Technology Adoption and Productivity Growth: Evidence from Industrialization in France," CEPR Discussion Papers 14970, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:14970
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    Cited by:

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    2. Réka Juhász & Mara P. Squicciarini & Nico Voigtländer, 2020. "Away from Home and Back: Coordinating (Remote) Workers in 1800 and 2020," NBER Working Papers 28251, National Bureau of Economic Research, Inc.
    3. Tania Babina & Anastassia Fedyk & Alex X. He & James Hodson, 2023. "Firm Investments in Artificial Intelligence Technologies and Changes in Workforce Composition," NBER Chapters, in: Technology, Productivity, and Economic Growth, National Bureau of Economic Research, Inc.
    4. Tommaso Giommoni & Gabriel Loumeau, 2022. "Taxation with a Grain of Salt: The Long-Term Effect of Fiscal Policy on Local Development," CESifo Working Paper Series 9997, CESifo.
    5. Javier Silvestre & John E. Murray, 2023. "Determinants in the adoption of a non-labor-substitution technology: mechanical ventilation in West Virginia coal mines, 1898–1907," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 17(3), pages 467-500, September.
    6. Carlos Esteban Posada, 2020. "Cambio técnico y política económica: la teoría y el caso colombiano (1950-2019)," Documentos de Trabajo de Valor Público 18506, Universidad EAFIT.

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    More about this item

    Keywords

    Industrialization; Technology adoption; Firm productivity;
    All these keywords.

    JEL classification:

    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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