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Self-Reinforcing Shocks: Evidence from a Resettlement Policy

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  • Aki Kangasharju
  • Matti Sarvimäki

Abstract

We examine the long-term effects of resettling 11 percent of the Finnish population from areas ceded to the Soviet Union during World War II. Our empirical strategy exploits features of the resettlement policy as a source of plausibly exogenous variation in population growth. The results suggest that a 10 percent increase in the population of a rural location during the war caused an additional 15 percent growth during the next five decades. The growth was driven by migration and led to the expansion of the non-primary sector. The effect is larger for locations connected to the railway network.

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Bibliographic Info

Paper provided by Spatial Economics Research Centre, LSE in its series SERC Discussion Papers with number 0047.

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Date of creation: Apr 2010
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Handle: RePEc:cep:sercdp:0047

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Web page: http://www.spatialeconomics.ac.uk/SERC/publications/default.asp

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Keywords: Economic geography; agglomeration; migration;

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