Globalization and Industrial Policy

The IP-KuK project examines industrial policy in the Austro-Hungarian Monarchy to understand how export promotion and targeted tariff policies affect economic development. Researchers focus on two historical interventions: the 1900 Paris Exhibitions role in promoting Hungarian firms internationally, and export-contingent input tariff reductions in the milling industry during the 1880s. These policies offer insights into mechanisms that remain relevant for contemporary industrial policy debates, particularly in low- and middle-income countries seeking export-led growth. The project creates new firm-level panel datasets from previously unexplored archival sources in Vienna, Budapest, and regional libraries, covering the 18701910 period. In addition to extensive archival work, researchers employ machine learning and genAI methods to enhance digitization and dataset creation opportunities. The researchers employ quasi-experimental methods to identify causal effects on firm performance, technology adoption, and regional development. The historical setting provides cleaner identification than modern contexts, where multiple interventions overlap, and allows them to study the role of cultural and ethnic diversityan issue with clear parallels to modern multiethnic economies such as the European Union. Additionally, the project is compiling the first comprehensive catalog of industrial policies implemented in the Austro-Hungarian Monarchy, addressing a major gap in the literature on 19th-century state intervention outside Western Europe.