Did M uhammad A li foster industrialization in early nineteenth‐century E gypt?

M uhammad A li, who ruled E gypt between 1805 and 1849, intervened in E gyptian markets in an attempt to foster industrialization, especially between 1812 and 1840. Like a modern marketing board, the state purchased agricultural commodities (cotton and wheat) at low prices and sold them on world markets at much higher prices, a policy equivalent to an export tax. A li also replaced tax farming with his own land taxes. The revenues so derived were used in part to finance manufacturing investment and to build irrigation canals. In addition, A li supplied flax and cotton at those cheap purchase prices to domestic textile manufacturing, thus subsidizing the industry. He also used non‐tariff barriers to exclude foreign competition from domestic markets. Were A li's state‐led policies successful in fostering industry? The answer is no easier to extract from this phase of E gyptian history than from that of other poor countries at that time. This is because E gypt faced the same terms of trade boom typical of most poor commodity exporters, which was causing de‐industrialization everywhere else in the poor periphery. A li picked a very difficult time to pursue his agenda, but we show that his policies were successful.