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We assess the empirical importance of changes in income andrelative prices for structural transformation in the postwar UnitedStates. We explain two natural approaches to the data: sectors maybe categories of final expenditure or value added; e.g., the servicesector may be the final expenditure on services or the value addedfrom service industries. We estimate preferences for each approachand find that with final expenditure income effects are the dominantforce behind structural transformation, whereas with value-addedcategories price effects are more important. We show how the inputoutputstructure of the United States can reconcile these findings.