The importance of education for economic development: A new agenda of economic-historical research using Prussian district data, part 2

In ifo Schnelldienst 23/2010 we reported the initial results of a new agenda of economic-historical research that examines historical processes of development with micro-econometric methods. The research uses the unique date set of Prussian censuses that is available at the district level for the entire 19th century. This research agenda is currently being pursued by the department for Human Capital and Innovation at the Ifo Institute within the framework of an extensive research project funded by the Leibniz Association on the "creation of an internationally leading centre for empirical research on the importance of education in long-term economic processes". The first article examined the historical importance of Protestantism for education; this second part builds on the first and looks at the importance of education for economic development. The provisional results show, among other things, that Protestant areas were economically more advanced solely on the basis of their better education. In addition, education was already an important performance-influencing factor in the first half of the 19th century for the industrialisation process in Prussia. And already before the demographic transition, there was a trade-off between education and fertility.