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Wars, Local Political Institutions, and Fiscal Capacity: Evidence from Six Centuries of German History

Author

Listed:
  • Becker, Sascha O.

    (University of Warwick and CAGE)

  • Ferrara, Andreas

    (University of Warwick and CAGE)

  • Melander, Eric

    (University of Warwick and CAGE)

  • Pascali, Luigi

    (UPF and CAGE)

Abstract

We study the effect of warfare on the development of state capacity and representative institutions using novel data on cities and territories in the German lands between 1200 and 1750. More specifically, we show that cities with a higher conflict exposure establish more sophisticated tax systems, but also develop larger councils, councils that are more likely to be elected by citizens, and more likely to be independent of other local institutions. These results are consistent with the idea of a trade-off between more efficient taxation and power sharing proposed in earlier work. We make headway on establishing a causal role of wars by using changes to German nobles’ positions within the European nobility network to instrument for conflict.

Suggested Citation

  • Becker, Sascha O. & Ferrara, Andreas & Melander, Eric & Pascali, Luigi, 2018. "Wars, Local Political Institutions, and Fiscal Capacity: Evidence from Six Centuries of German History," CAGE Online Working Paper Series 395, Competitive Advantage in the Global Economy (CAGE).
    • Handle: RePEc:cge:wacage:395
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    Cited by:

    1. Schaff, Felix, 2020. "When ‘the state made war’, what happened to economic inequality? Evidence from preindustrial Germany (c.1400-1800)," LSE Research Online Documents on Economics 107046, London School of Economics and Political Science, LSE Library.
    2. David de la Croix & Pauline Morault, 2020. "Winners and Losers from the Protestant Reformation: An Analysis of the Network of European Universities," LIDAM Discussion Papers IRES 2020029, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    3. Schaff, Felix S.F., 2023. "Warfare and Economic Inequality: Evidence from Preindustrial Germany (c. 1400-1800)," Explorations in Economic History, Elsevier, vol. 89(C).
    4. Schaff, Felix, 2020. "When ‘the state made war’, what happened to economic inequality? Evidence from preindustrial Germany (c.1400-1800)," Economic History Working Papers 107046, London School of Economics and Political Science, Department of Economic History.

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    More about this item

    Keywords

    N13; P48; R11 Jel Classification: WARFARE; POLITICAL INSTITUTIONS; STATE CAPACITY;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

    NEP fields

    This paper has been announced in the following NEP Reports:

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