Abstract
The emergence of a particular set of socio-psychological traits, including patience, impersonal pro-sociality, and individualism, is hypothesized to be central to Europe’s economic and industrial takeoff. An open question is whether such cultural characteristics lead to industrialization, or whether industrialization itself causes individuals and societies to develop such psychological patterns. We make progress on this question by conducting a field experiment in Tanzania to separately identify the selection and treatment effects of manufacturing employment. On the selection margin, we ask whether individuals who self-select into manufacturing employment systematically differ in their ability, ‘soft’ skills (including self-control and punctuality), and psychological traits (such as competitiveness and individualism). On the treatment margin, we partner with one of the largest garment factories in Tanzania to implement a randomized encouragement design to generate exogenous variation in hiring probabilities to measure the causal effects of manufacturing employment on these same dimensions.