I would like to thank Sisira Jayasuriya for offering his continuous guidance and valuable comments. I am also grateful to John King for his useful feedback, to Jeff Williamson, Nobuaki Yamashita, and Sam King for their help with the literature and the data.
De-industrialization and re-industrialization in the Middle East: reflections on the cotton industry in Egypt and in the Izmir region†
Article first published online: 28 JUL 2013
© Economic History Society 2013
The Economic History Review
Volume 67, Issue 1, pages 146–169, February 2014
How to Cite
Panza, L. (2014), De-industrialization and re-industrialization in the Middle East: reflections on the cotton industry in Egypt and in the Izmir region. The Economic History Review, 67: 146–169. doi: 10.1111/1468-0289.12019
- Issue published online: 15 JAN 2014
- Article first published online: 28 JUL 2013
- Manuscript Accepted: 15 APR 2013
- Manuscript Revised: 10 MAR 2013
- Manuscript Received: 23 JUL 2012
This article presents an investigation of the process of decline and rebirth of textile manufacturing in two Middle Eastern regions, Egypt and the Izmir region, during the first wave of globalization (1850–1914). Through the application of the ‘Dutch disease’ model, it explores the linkages between terms of trade and industrialization. These are further related to the evolution of price transmission between domestic and global raw cotton markets. Findings indicate that different levels of market integration have contributed to diverging trajectories in industrial development in the two regions: while in Egypt the process of de-industrialization was not reversed, in the Izmir region weaker international price transmission facilitated the creation of a nascent domestic textile industry. However, terms of trade patterns and relative price movements are only one of the causes that can explain the differences between the two regions.