Long-term Persistence

We study whether culture has an independent role in creating persistence of institutional shocks by testing whether today’s notable differences in civic capital between the North and the South of Italy are the legacy of the medieval free city-state experience of the Middle Ages. We show that cities that experienced self-government in the Middle Ages have more civic capital today. This effect is observable even within the North and persists even accounting for the fact that cities did not become independent randomly. We conjecture that this effect persisted over time through the intergenerational transmission of attributional styles (i.e., the way people explain the events they experience to themselves). Consistently, we find that fifth-graders in former city-states exhibit a less pessimistic attributional style, which itself is correlated with a higher level of civic capital.