2024 Reports

Codification, Technology Absorption, and the Globalization of the Industrial Revolution

Juhász, Réka; Sakabe, Shogo; Weinstein, David E.

This paper studies technology absorption worldwide in the late nineteenth century. We construct several novel datasets to test the idea that the codification of technical knowledge in the vernacular was necessary for countries to absorb the technologies of the Industrial Revolution. Using the rapid and unprecedented codification of technical knowledge in Meiji Japan as a natural experiment, we show that productivity growth in Japan was higher in industries that could potentially benefit from Western technical knowledge only after the Japanese government codified as much technical knowledge as what was available in Germany in 1870. We find no similar patterns in other parts of the world that did not codify knowledge. Our findings shed new light on the frictions associated with technology diffusion and offer a novel take on why Meiji Japan was unique among non-Western countries in successfully industrializing during the first wave of globalization.

JEL CLASSIFICATION: F14, F63, N15

KEYWORDS: Industrialization, Codification, Technology Adoption, Late Development, Productivity, Industrial Policy, Japan