The Myth of the Frontier
In: Understanding Long-Run Economic Growth: Geography, Institutions, and the Knowledge Economy
One of the most salient explanations for the distinctive path of economic and political development of the United States is captured by the 'Frontier (or Turner) thesis'. Turner argued that it was the presence of the open frontier which explained why the United States became democratic and, at least implicitly, prosperous. In this paper we provide a simple test of this idea. We begin with the contradictory observation that almost every Latin American country had a frontier in the 19th century as well. We show that while the data does not support the Frontier thesis, it is consistent with a more complex 'conditional Frontier thesis.' In this view, the effect of the frontier is conditional on the way that the frontier was allocated and this in turn depends on political institutions at the time of frontier expansion. We show that for countries with the worst political institutions, there is a negative correlation between the historical extent of the frontier and contemporary income per-capita. For countries with better political institutions this correlation is positive. Though the effect of the frontier on democracy is positive irrespective of initial political institutions, it is larger the better were these institutions. In essence, Turner saw the frontier as having positive effects on development because he already lived in a country with good institutions.
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