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Persistent Antimarket Culture: A Legacy of the Pale of Settlement after the Holocaust

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  • Irena Grosfeld
  • Alexander Rodnyansky
  • Ekaterina Zhuravskaya

Abstract

We estimate long-term effects of Jewish presence in Europe before World War II, using discontinuity at the border of the "Pale of Settlement" area where Jews were allowed to live in the Russian Empire. Current residents of the Pale have lower support for market, and are less entrepreneurial but more trusting compared to those outside the Pale. We suggest a mechanism and test for it: anti-Semitism generated persistent antimarket culture and trust among non-Jews. Consistent with this mechanism, antimarket attitudes and trust decrease with distance to pogroms controlling for historical Jewish presence. Self-identification and cohesion of majority depends on the presence of minority.

Suggested Citation

  • Irena Grosfeld & Alexander Rodnyansky & Ekaterina Zhuravskaya, 2013. "Persistent Antimarket Culture: A Legacy of the Pale of Settlement after the Holocaust," American Economic Journal: Economic Policy, American Economic Association, vol. 5(3), pages 189-226, August.
  • Handle: RePEc:aea:aejpol:v:5:y:2013:i:3:p:189-226
    Note: DOI: 10.1257/pol.5.3.189
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    Cited by:

    1. Carvalho, Jean-Paul & Koyama, Mark, 2016. "Jewish emancipation and schism: Economic development and religious change," Journal of Comparative Economics, Elsevier, vol. 44(3), pages 562-584.
    2. Couttenier, Mathieu & Sangnier, Marc, 2015. "Living in the Garden of Eden: Mineral resources and preferences for redistribution," Journal of Comparative Economics, Elsevier, vol. 43(2), pages 243-256.
    3. Marcel Prokopczuk & Francesco D'Acunto & Michael Weber, 2015. "Distrust in Finance Lingers: Jewish Persecution and Households' Investments," 2015 Meeting Papers 26, Society for Economic Dynamics.
    4. Couttenier, Mathieu & Sangnier, Marc, 2015. "Living in the Garden of Eden: Mineral resources and preferences for redistribution," Journal of Comparative Economics, Elsevier, vol. 43(2), pages 243-256.
    5. Michalopoulos, Stelios & Papaioannou, Elias, 2017. "Spatial Patterns of Development: A Meso Approach," Working Papers 4, Federal Reserve Bank of Minneapolis, Opportunity and Inclusive Growth Institute.
    6. Natkhov, Timur, 2015. "Colonization and development: The long-term effect of Russian settlement in the North Caucasus, 1890s–2000s," Journal of Comparative Economics, Elsevier, vol. 43(1), pages 76-97.
    7. Eder, Christoph & Halla, Martin, 2017. "Economic Origins of Cultural Norms: The Case of Animal Husbandry and Bastardy," IZA Discussion Papers 10969, Institute for the Study of Labor (IZA).
    8. repec:eee:rujoec:v:1:y:2015:i:2:p:154-181 is not listed on IDEAS
    9. Grosfeld, Irena & Zhuravskaya, Ekaterina, 2015. "Cultural vs. economic legacies of empires: Evidence from the partition of Poland," Journal of Comparative Economics, Elsevier, vol. 43(1), pages 55-75.
    10. Rachel E. Kranton, 2016. "Identity Economics 2016: Where Do Social Distinctions and Norms Come From?," American Economic Review, American Economic Association, vol. 106(5), pages 405-409, May.
    11. Francesco D’Acunto & Marcel Prokopczuk & Michael Weber, 2017. "Historical Antisemitism, Ethnic Specialization, and Financial Development," NBER Working Papers 23785, National Bureau of Economic Research, Inc.
    12. Christoph Eder, 2014. "Missing Men: World War II Casualties and Structural Change," NRN working papers 2014-03, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
    13. De Haas, Ralph & Djourelova, Milena & Nikolova, Elena, 2016. "The Great Recession and social preferences: Evidence from Ukraine," Journal of Comparative Economics, Elsevier, vol. 44(1), pages 92-107.
    14. Stelios Michalopoulos & Elias Papaioannou, 2017. "Spatial Patterns of Development: A Meso Approach," NBER Working Papers 24088, National Bureau of Economic Research, Inc.
    15. Vitola, Alise & Grigoriadis, Theocharis, 2018. "Diversity & empire: Baltic Germans & comparative development," Discussion Papers 2018/6, Free University Berlin, School of Business & Economics.
    16. Yann Algan & Pierre Cahuc, 2010. "Inherited Trust and Growth," American Economic Review, American Economic Association, vol. 100(5), pages 2060-2092, December.
    17. Irena Grosfeld & Ekaterina Zhuravskaya, 2013. "Persistent effects of empires: Evidence from the partitions of Poland," PSE Working Papers halshs-00795231, HAL.
    18. Martin Mendelski & Alexander Libman, 2014. "Demand for litigation in the absence of traditions of rule of law: an example of Ottoman and Habsburg legacies in Romania," Constitutional Political Economy, Springer, vol. 25(2), pages 177-206, June.
    19. Ochsner, Christian & Roesel, Felix, 2016. "Migrating Extremists," Annual Conference 2016 (Augsburg): Demographic Change 145632, Verein für Socialpolitik / German Economic Association.
    20. Finley, Theresa & Koyama, Mark, 2016. "Plague, Politics, and Pogroms: The Black Death, Rule of Law, and the persecution of Jews in the Holy Roman Empire," MPRA Paper 72110, University Library of Munich, Germany.
    21. Giuseppe Albanese & Guido Blasio & Paolo Sestito, 2016. "My parents taught Me. Evidence on the family transmission of values," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(2), pages 571-592, April.
    22. Grosfeld, Irena & Sakalli, Seyhun Orcan & Zhuravskaya, Ekaterina, 2017. "Middleman Minorities and Ethnic Violence: Anti-Jewish Pogroms in the Russian Empire," CEPR Discussion Papers 12154, C.E.P.R. Discussion Papers.
    23. Colussi, Tommaso & Isphording, Ingo E. & Pestel, Nico, 2016. "Minority Salience and Political Extremism," IZA Discussion Papers 10417, Institute for the Study of Labor (IZA).
    24. Catalina Tejada & Eliana Ferrara & Henrik Kleven & Florian Blum & Oriana Bandiera & Michel Azulai, 2015. "State Effectiveness, Growth, and Development," Working Papers id:6668, eSocialSciences.

    More about this item

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • N33 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: Pre-1913
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
    • P10 - Economic Systems - - Capitalist Systems - - - General
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion

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