In this session of the European Macro History Online Seminar series, Charlotte Bartels, Post-doctoral researcher at the German Institute for Economic Research (DIW), will present on The Long-Term Effects of Equal Sharing: Evidence from Historical Inheritance Rules for Land.
Abstract: What are long-term economic effects of a more equal distribution of wealth? We exploit variation in historical inheritance rules for land during Germany’s transition from an agrarian to an industrial economy. Inherited land was to be shared equally among children in some German areas, while others ruled land to be indivisible. Using a geographic regression discontinuity design, we show that the equal division of land lowered landholding inequality and led to an earlier industrialization, in particular in innovative industries and occupations. The small and fragmented peasant holdings in equal division areas created both the incentive and the chance for extensive engagement in industrial by-employment during the industrialization period. Studying long-term outcomes, we find substantially higher GDP per capita, higher labor productivity, higher top incomes and more millionaires in equal division areas today. Other potential drivers of growth are smooth at the boundary and equal division areas were not historically more developed.
This online seminar is part of the European Macro History Online Seminar series. If you wish to attend, please register below for the entire series.
Download the slides (PDF, 410 KB)