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State capacity and public goods: institutional change,human capital and growth in early modern Germany

Author

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  • Dittmar, Jeremiah
  • Meisenzahl, Ralf R.

Abstract

What are the origins and consequences of the state as a provider of public goods? We study legal reforms that established mass public education and increased state capacity in German cities during the 1500s. These fundamental changes in public goods provision occurred where ideological competition during the Protestant Reformation interacted with popular politics at the local level. We document that cities that formalized public goods provision in the 1500s began differentially producing and attracting upper tail human capital and grew to be significantly larger in the long-run. We study plague outbreaks in a narrow time period as exogenous shocks to local politics and find support for a causal interpretation of the relationship between public goods institutions, human capital, and growth. More broadly, we provide evidence on the origins of state capacity directly targeting welfare improvement.

Suggested Citation

  • Dittmar, Jeremiah & Meisenzahl, Ralf R., 2016. "State capacity and public goods: institutional change,human capital and growth in early modern Germany," LSE Research Online Documents on Economics 66435, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:66435
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    File URL: http://eprints.lse.ac.uk/66435/
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    Citations

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    Cited by:

    1. Lecce, Giampaolo & Ogliari, Laura, 2019. "Institutional Transplant and Cultural Proximity: Evidence from Nineteenth-Century Prussia," The Journal of Economic History, Cambridge University Press, vol. 79(4), pages 1060-1093, December.
    2. Mario F Carillo, 2021. "Agricultural Policy and Long-Run Development: Evidence from Mussolini's Battle for Grain," The Economic Journal, Royal Economic Society, vol. 131(634), pages 566-597.
    3. Evans, Olaniyi, 2022. "The criticality of institutions and the macroeconomy for education outcomes in Africa," MPRA Paper 118197, University Library of Munich, Germany.
    4. Stefano Comino & Alberto Galasso & Clara Graziano, 2017. "The Diffusion of New Institutions: Evidence from Renaissance Venice's Patent System," NBER Working Papers 24118, National Bureau of Economic Research, Inc.
    5. Michel Serafinelli & Guido Tabellini, 2022. "Creativity over time and space," Journal of Economic Growth, Springer, vol. 27(1), pages 1-43, March.
    6. Ennio E. Piano, 2019. "State capacity and public choice: a critical survey," Public Choice, Springer, vol. 178(1), pages 289-309, January.

    More about this item

    Keywords

    State capacity; institutions; growth; education; human capital; persistence;
    All these keywords.

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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