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Identity and Mobility: Historical Fractionalization, Parochial Institutions, and Occupational Choice in the American Midwest

This paper examines the role played by a specific identity, defined as the attachment to a hometown, in determining occupational choice and mobility. The analysis links competition between ethnic networks in the Midwest when it was first developing, and the in-group identity that emerged endogenously to support these networks, to institutional participation and occupational choice today. Individuals born in counties with greater ethnic fractionalization in 1860 are today -- 150 years later --(i) significantly more likely to participate in institutions such as churches and parochial schools that transmit identity from one generation to the next, and (ii) significantly less likely to select into mobile skilled occupations. The effect of historical fractionalization on participation in these socializing institutions actually grows stronger over the course of the twentieth century, emphasizing the idea that small differences in initial conditions can have large long-term effects on institutions and economic choices.

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Paper provided by Department of Economics, Williams College in its series Center for Development Economics with number 2011-02.

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Length: 44 pages
Date of creation: Oct 2010
Date of revision:
Handle: RePEc:wil:wilcde:2011-02
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  1. Coakley, Jerry & Kulasi, Farida & Smith, Ron, 1998. "The Feldstein-Horioka Puzzle and Capital Mobility: A Review," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 3(2), pages 169-88, April.
  2. Jappelli, Tullio & Pagano, Marco, 1994. "Saving, Growth, and Liquidity Constraints," The Quarterly Journal of Economics, MIT Press, vol. 109(1), pages 83-109, February.
  3. Oriana Bandiera & Gerard Caprio & Patrick Honohan & Fabio Schiantarelli, 2000. "Does Financial Reform Raise or Reduce Saving?," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 239-263, May.
  4. Orazio P. Attanasio & Lucio Picci & Antonello E. Scorcu, 2000. "Saving, Growth, and Investment: A Macroeconomic Analysis Using a Panel of Countries," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 182-211, May.
  5. Hamid Faruqee & Aasim M. Husain, 1995. "Saving Trends in Southeast Asia: A Cross-Country Analysis," IMF Working Papers 95/39, International Monetary Fund.
  6. Sebastian Edwards, 1995. "Why are Saving Rates so Different Across Countries?: An International Comparative Analysis," NBER Working Papers 5097, National Bureau of Economic Research, Inc.
  7. Ghura, Dhaneshwar & Grennes, Thomas J., 1993. "The real exchange rate and macroeconomic performance in Sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 42(1), pages 155-174, October.
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