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This article revisits and empirically tests the conjecture that specialization in natural resource industries (NRI) might not necessarily be a 'curse' for developing countries if it generates opportunities for export diversification in backward‐linked sectors à la Hirschman. The article systematizes the evolution of the debate around the NRI 'curse'. Then it empirically tests whether NRI might represent a sufficient 'domestic representative demand' à la Linder to favour diversification into backward‐linked sectors such as knowledge‐intensive business services and high‐tech manufacturing. It focuses on the former and discusses the new opportunities for export diversification led by virtuous pathways of domestic structural change. It finds novel, quantitative empirical support for this conjecture, which complements extant qualitative literature and discusses implications that revisit the NRI curse debate. [ABSTRACT FROM AUTHOR]

The article revisits two classical approaches to development and trade, and offers an alternative account of the emergence of global value chains (GVCs) involving business services (BS), to trade-in-tasks theory. Based on this account, we propose what we call the Hirschman–Linder hypothesis (HLH), which predicts the need for an adequate 'representative domestic' (intermediate) demand for BS for countries to enter and upgrade in BS GVCs. We review the quantitative and qualitative empirical evidence supporting the HLH and find two main results: (i) countries with a substantial manufacturing core are more likely to participate (and eventually to upgrade) in BS GVCs, and (ii) countries endowed or specialized in natural resource industry (NRI), either the primary or extractive sectors are also likely to be part of BS GVCs. If BS GVCs represent globalization's third unbundling for developing countries, the HLH suggests that on the one hand a core manufacturing sector is essential for entering and upgrading in BS GVCs, and on the other hand that if countries can diversify into BS and upgrade in BS GVCs specialization in natural resources might not necessarily be a curse. [ABSTRACT FROM AUTHOR]