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Becker, Sascha O.; Hornung, Erik; Wößmann, Ludger (2011): Education and catch-up in the industrial revolution. In: American Economic Journal: Macroeconomics, Vol. 3, No. 3: pp. 92-126
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Research increasingly stresses the role of human capital in modern economic development. Existing historical evidence-mostly from British textile industries-however, rejects that formal education was important for the Industrial Revolution. Our new evidence from technological follower Prussia uses a unique school enrollment and factory employment database linking 334 counties from pre-industrial 1816 to two industrial phases in 1849 and 1882. Using pre-industrial education as instrument for later education and controlling extensively for pre-industrial development, we find that basic education is significantly associated with nontextile industrialization in both phases of the Industrial Revolution. Panel data models with county fixed effects confirm the results.