Modernized
Work ethic and economic development: An investigation into Weber's thesis
Annemiek Schilpzand & Eelke de Jong
European Journal of Political Economy, forthcoming
Abstract:
This paper argues that the capitalist spirit associated with Max Weber's Protestant Ethics is not associated with Protestantism but with the modernization phase of economic development. A preference for hard work is also found amongst other religions and non-religious people at times of high economic growth and decreases after the modernization phase. We find a robust relationship between the level and growth of economic development during an individual's childhood and this individual's work ethic. An epidemiological approach is applied to indicate that the direction of the relationship runs from growth and the level of economic development at the time values are formed, to work ethic. Protestant adherence has a positive relation with work ethic, but this relation is less robust than economic development.
The Non-Democratic Roots of Mass Education: Evidence from 200 Years
Agustina Paglayan
American Political Science Review, forthcoming
Abstract:
Because primary education is often conceptualized as a pro-poor redistributive policy, a common argument is that democratization increases its provision. But primary education can also serve the goals of autocrats, including redistribution, promoting loyalty, nation-building, and/or industrialization. To examine the relationship between democratization and education provision empirically, I leverage new datasets covering 109 countries and 200 years. Difference-in-differences and interrupted time series estimates find that, on average, democratization had no or little impact on primary school enrollment rates. When unpacking this average null result, I find that, consistent with median voter theories, democratization can lead to an expansion of primary schooling, but the key condition under which it does — when a majority lacked access to primary schooling before democratization — rarely holds. Around the world, state-controlled primary schooling emerged a century before democratization, and in three-fourths of countries that democratized, a majority already had access to primary education before democratization.
The Gender Gap in Competitive Chess across Countries: Commanding Queens in Command Economies
Maryam Dilmaghani
Journal of Comparative Economics, forthcoming
Abstract:
Currently, the World Chess Federation lists 1,643 male Grandmasters against only 37 females. While the greater attainment of men in competitive chess is well known, the lesser known fact is that the gender gap in competitive chess varies strongly across countries. For instance, for every 100 male players with the attainment level of Candidate Master, there are about 48, 47, 38, 4, 3, and 2 female players in Vietnam, Georgia, China, US (Japan), France (Sweden), and Denmark (Finland), respectively. Noting these large gender discrepancies, this paper constructs a cross-country panel to explore the determinants of these gaps. Controlling for main economic development indicators and several measures of gender equality, a legacy of command economy is found to be the most significant predictor of a smaller gender gap in competitive chess across countries. Various explanations and their implications are discussed.
Shipwrecked by Rents
Fernando Arteaga, Desiree Desierto & Mark Koyama
George Mason University Working Paper, September 2020
Abstract:
The trade route between Manila and Mexico was a monopoly of the Spanish Crown for more than 250 years. The Manila Galleons were ``the richest ships in all the oceans'', but much of the wealth sank at sea and remain undiscovered. We introduce a newly constructed dataset of all of the ships that travelled this route. We show formally how monopoly rents that allowed widespread bribe-taking would have led to overloading and late ship departure, thereby increasing the probability of shipwreck. Empirically, we demonstrate not only that these late and overloaded ships were more likely to experience shipwrecks or to return to port, but that such effect is stronger for galleons carrying more valuable, higher-rent, cargo. This sheds new light on the costs of rent-seeking in European colonial empires.
Tracking historical changes in trustworthiness using machine learning analyses of facial cues in painting
Lou Safra et al.
Nature Communications, September 2020
Abstract:
Social trust is linked to a host of positive societal outcomes, including improved economic performance, lower crime rates and more inclusive institutions. Yet, the origins of trust remain elusive, partly because social trust is difficult to document in time. Building on recent advances in social cognition, we design an algorithm to automatically generate trustworthiness evaluations for the facial action units (smile, eye brows, etc.) of European portraits in large historical databases. Our results show that trustworthiness in portraits increased over the period 1500–2000 paralleling the decline of interpersonal violence and the rise of democratic values observed in Western Europe. Further analyses suggest that this rise of trustworthiness displays is associated with increased living standards.
Atlantic Slavery and the Rise of the Capitalist Global Economy
Joseph Inikori
Current Anthropology, forthcoming
Abstract:
This article traces the long-run contribution of the employment of enslaved Africans in large-scale commodity production in the Americas to the rise of the capitalist global economy. It demonstrates the two-stage evolution of the global economy — the rise of the nineteenth-century capitalist Atlantic economic system (the nucleus of the global economy), the first stage, and the extension of that system to Asia and the rest of the world, the second stage. It shows that the establishment of the integrated nineteenth-century Atlantic economy was a function of the growth of multilateral trade in the Atlantic basin that resulted from the employment of enslaved Africans in large-scale commodity production in the Americas, on which basis the major economies of the Americas, especially the US economy, and Western European economies, especially the British economy, achieved structural transformation, which included the British Industrial Revolution and its new technologies. Led by Great Britain, the advanced economies of the Atlantic world employed the new technologies of the Industrial Revolution, economically and politically, to extend the Atlantic capitalist economic order to Asia and the rest of the world to constitute the hierarchically structured capitalist global economic order.
Aid Volatility, Human Capital, and Growth
Pierre-Richard Agénor & Nihal Bayraktar
Journal of Human Capital, Fall 2020, Pages 401–448
Abstract:
We study the effect of aid volatility on education outcomes and economic growth, in a model that focuses on a low-income economy where acquiring skills benefits from public subsidies partly financed through foreign aid. By creating uncertainty about the net return to education, a high degree of aid volatility mitigates agents’ incentives to invest in skills. If savings and growth depend on the composition of the labor force, aid volatility may have an adverse effect on the mean growth rates of investment and output. Panel data regressions for a group of aid-dependent countries provide robust evidence of a negative relationship between the volatility of education aid and schooling outcomes.
Entrepreneurship, fear of failure, and economic policy
Nabamita Dutta & Russell Sobel
European Journal of Political Economy, forthcoming
Abstract:
The previous literature finds that self-reported ‘fear of failure’ has a significant negative effect on individuals' choice to become entrepreneurs. We hypothesize this effect is lessened in economies with a larger number of additional, alternative, entrepreneurial opportunities to pursue if a failure occurs. Prior literature also concludes the number of entrepreneurial opportunities is enhanced significantly by having policies and institutions consistent with higher levels of economic freedom. We therefore test and confirm that fear of failure hurts the entrepreneurial process less when levels of economic freedom are higher as there are more additional chances for failed entrepreneurs to pursue.
The demographic dividend is more than an education dividend
Rainer Kotschy, Patricio Suarez Urtaza & Uwe Sunde
Proceedings of the National Academy of Sciences, 20 October 2020, Pages 25982-25984
Abstract:
The demographic dividend has long been viewed as an important factor for economic development and provided a rationale for policies aiming at a more balanced age structure through birth control and family planning. Assessing the relative importance of age structure and increases in human capital, recent work has argued that the demographic dividend is related to education and has suggested a dominance of improving education over age structure. Here we reconsider the empirical relevance of shifts in the age distribution for development for a panel of 159 countries over the period 1950 to 2015. Based on a flexible model of age-structured human capital endowments, the results document important interactions between age structure and human capital endowments, suggesting that arguments of clear dominance of education over age structure are unwarranted and lead to potentially misleading policy conclusions. An increase in the working-age population share has a strong and significant positive effect on growth, even conditional on human capital, in line with the conventional notion of a demographic dividend. An increase in human capital only has positive growth effects if combined with a suitable age structure. An increasing share of the most productive age groups has an additional positive effect on economic performance. Finally, the results show considerable heterogeneity in the effect of age structure and human capital for different levels of development. Successful policies for sustainable development should take this heterogeneity into account to avoid detrimental implications of a unidimensional focus on human capital without accounting for demography.
Engineering Informal Institutions: Long-Run Impacts of Alternative Dispute Resolution on Violence and Property Rights in Liberia
Alexandra Hartman, Robert Blair & Christopher Blattman
Journal of Politics, forthcoming
Abstract:
Informal institutions govern property rights and disputes when formal systems are weak. Effective informal institutions should help people reach and maintain bargains, minimizing violence. Can outside organizations engineer persistent institutional change? Will this strengthen property rights and investment? We experimentally evaluate a United Nations and civil society mass education campaign to promote alternative dispute resolution practices and norms in rural Liberia, where violent land disputes are common. Prior work showed a drop in violence and unresolved disputes within one year. We return after three years to test for sustained impacts and mechanisms. Treated communities report large, persistent drops in violent disputes and a slight shift toward nonviolent norms. Treated residents also report larger farms, although overall effects on property rights and investment are mixed. Politically connected residents report more secure property rights, while those with fewer connections feel less secure. Sustained institutional engineering is feasible, but politics shapes distributional outcomes.