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The Role of Human Capital and Innovation in Prussian Economic Development

  • Francesco Cinnirella


  • Jochen Streb

By merging individual data on valuable patents granted in Prussia in the late nineteenth century with county level information on literacy and income tax revenues we show that increases in the stock of human capital not only improved workers’ productivity but also accelerated innovative activities which, in turn, evoked an additional rise in the productivity level. Instrumenting the stock of literate people with information on the number of blind and deaf-mute people we also establish the direct causal effect of human capital on income, net of the innovation channel.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 4391.

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Date of creation: 2013
Date of revision:
Handle: RePEc:ces:ceswps:_4391
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  1. Kenneth L. Sokoloff, 1988. "Inventive Activity in Early Industrial America: Evidence From Patent Records, 1790-1846," UCLA Economics Working Papers 499, UCLA Department of Economics.
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  9. Oded Galor & Omar Moav & Dietrich Vollrath, 2006. "Inequality in Land Ownership, the Emergence of Human Capital Promoting Institutions, and the Great Divergence," DEGIT Conference Papers c011_001, DEGIT, Dynamics, Economic Growth, and International Trade.
  10. Erik Hornung, 2012. "Human Capital, Technology Diffusion, and Economic Growth - Evidence from Prussian Census Data," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute for Economic Research at the University of Munich, number 46, November.
  11. Zvi Griliches, 1998. "Patent Statistics as Economic Indicators: A Survey," NBER Chapters, in: R&D and Productivity: The Econometric Evidence, pages 287-343 National Bureau of Economic Research, Inc.
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