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A Two-Tiered Demographic System: "Insiders" and "Outsiders" in Three Swabian Communities, 1558-1914

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Listed:
  • Guinnane, Timothy W.

    (Yale University)

  • Ogilvie, Sheilagh C.

    (University of Cambridge)

Abstract

The investment decisions of small-scale farmers in developing countries are conditioned by their financial environment. Binding credit market constraints and incomplete insurance can reduce investment in activities with high expected profits. We conducted several experiments in northern Ghana in which farmers were randomly assigned to receive cash grants, grants of or opportunities to purchase rainfall index insurance, or a combination of the two. Demand for index insurance is strong, and insurance leads to significantly larger agricultural investment and riskier production choices in agriculture. The salient constraint to farmer investment is uninsured risk: when provided with insurance against the primary catastrophic risk they face, farmers are able to find resources to increase expenditure on their farms. Demand for insurance in subsequent years is strongly increasing in a farmer's own receipt of insurance payouts, and with the receipt of payouts by others in the farmer's social network. Both investment patterns and the demand for index insurance are consistent with the presence of important basis risk associated with the index insurance, and with imperfect trust that promised payouts will be delivered.

Suggested Citation

  • Guinnane, Timothy W. & Ogilvie, Sheilagh C., 2013. "A Two-Tiered Demographic System: "Insiders" and "Outsiders" in Three Swabian Communities, 1558-1914," Working Papers 112, Yale University, Department of Economics.
  • Handle: RePEc:ecl:yaleco:112
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    References listed on IDEAS

    as
    1. Sheilagh Ogilvie, 2004. "Guilds, efficiency, and social capital: evidence from German proto-industry," Economic History Review, Economic History Society, vol. 57(2), pages 286-333, May.
    2. Ogilvie, Sheilagh & Küpker, Markus & Maegraith, Janine, 2012. "Household Debt in Early Modern Germany: Evidence from Personal Inventories," The Journal of Economic History, Cambridge University Press, vol. 72(01), pages 134-167, March.
    3. Toni Richards, 1983. "Weather, nutrition, and the economy: Short-run fluctuations in births, deaths, and marriages, France 1740–1909," Demography, Springer;Population Association of America (PAA), vol. 20(2), pages 197-212, May.
    4. David N. Weil & Oded Galor, 2000. "Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond," American Economic Review, American Economic Association, vol. 90(4), pages 806-828, September.
    5. Weir, David R., 1984. "Life Under Pressure: France and England, 1670–1870," The Journal of Economic History, Cambridge University Press, vol. 44(01), pages 27-47, March.
    6. Timothy W. Guinnane, 2011. "The Historical Fertility Transition: A Guide for Economists," Journal of Economic Literature, American Economic Association, vol. 49(3), pages 589-614, September.
    7. Ogilvie, Sheilagh, 2003. "A Bitter Living: Women, Markets, and Social Capital in Early Modern Germany," OUP Catalogue, Oxford University Press, number 9780198205548.
    8. Ogilvie, S. & Küpker, M. & Maegraith, J., 2009. "Community Characteristics and Demographic Development: Three Württemberg Communities, 1558 - 1914," Cambridge Working Papers in Economics 0910, Faculty of Economics, University of Cambridge.
    9. Guinnane, Timothy W. & Ogilvie, Sheilagh, 2008. "Institutions and Demographic Responses to Shocks: Wurttemberg, 1634-1870," Working Papers 44, Yale University, Department of Economics.
    10. Tommy Bengtsson & Cameron Campbell & James Z. Lee, 2004. "Life Under Pressure: Mortality and Living Standards in Europe and Asia, 1700-1900," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262025515, March.
    11. Noriko O. Tsuya & Wang Feng & George Alter & James Z. Lee, 2010. "Prudence and Pressure: Reproduction and Human Agency in Europe and Asia, 1700-1900," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262013525, March.
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    More about this item

    JEL classification:

    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)
    • N33 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: Pre-1913
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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