Engineers, Innovative Capacity and Development in the Americas

Using newly collected national and
sub-national data, and historical case studies, this paper
argues that differences in innovative capacity, captured by
the density of engineers at the dawn of the Second
Industrial Revolution, are important to explaining present
income differences, and, in particular, the poor performance
of Latin America relative to North America. This remains the
case after controlling for literacy, other higher order
human capital, such as lawyers, as well as demand side
elements that might be confounded with engineering. The
analysis then finds that agglomeration, certain geographical
fundamentals, and extractive institutions such as slavery
affect innovative capacity. However, a large effect
associated with being a Spanish colony remains suggesting
important inherited factors.