IDEAS home Printed from https://ideas.repec.org/p/zbw/hohdps/092019.html
   My bibliography  Save this paper

The fetters of inheritance? Equal partition and regional economic development

Author

Listed:
  • Huning, Thilo R.
  • Wahl, Fabian

Abstract

How can agricultural inheritance traditions affect structural change and economic development in rural areas? The most prominent historical traditions are primogeniture, where the oldest son inherits the whole farm, and equal partition, where land is split and each heir inherits an equal share. In this paper, we provide a theoretical model that links these inheritance traditions to the local allocation of labor and capital and to municipal development. First, we show that among contemporary municipalities in West Germany, equal partition is significantly related to measures of economic development. Second, we conduct OLS and fuzzy spatial RDD estimates for Baden-Württemberg in the 1950s and today. We find that inheritance rules caused, in line with our theoretical predictions, higher incomes, population densities, and industrialization levels in areas with equal partition. Results suggest that more than a third of the overall inter-regional difference in average per capita income in present-day Baden Württemberg, or 597 Euro, can be explained by equal partition.

Suggested Citation

  • Huning, Thilo R. & Wahl, Fabian, 2019. "The fetters of inheritance? Equal partition and regional economic development," Hohenheim Discussion Papers in Business, Economics and Social Sciences 09-2019, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    • Handle: RePEc:zbw:hohdps:092019
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/206402/1/1681189216.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Sascha O. Becker & Ludger Woessmann, 2009. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 531-596.
    2. Cinnirella, Francesco & Hornung, Erik, 2016. "Landownership concentration and the expansion of education," Journal of Development Economics, Elsevier, vol. 121(C), pages 135-152.
    3. Bartels, Charlotte & Jäger, Simon & Obergruber, Natalie, 2020. "Long-Term Effects of Equal Sharing: Evidence from Inheritance Rules for Land," IZA Discussion Papers 13665, Institute of Labor Economics (IZA).
    4. Baker, Matthew & Miceli, Thomas J., 2005. "Land inheritance rules: theory and cross-cultural analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 56(1), pages 77-102, January.
    5. Oswald, Andrew J., 1996. "A Conjecture on the Explanation for High Unemployment in the Industrialized Nations: Part I," Economic Research Papers 268744, University of Warwick - Department of Economics.
    6. Stelios Michalopoulos & Elias Papaioannou, 2016. "The Long-Run Effects of the Scramble for Africa," American Economic Review, American Economic Association, vol. 106(7), pages 1802-1848, July.
    7. Hans-Joachim Voth, 2013. "The Three Horsemen of Riches: Plague, War, and Urbanization in Early Modern Europe," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(2), pages 774-811.
    8. Paul L. Menchik, 1980. "Primogeniture, Equal Sharing, and the U.S. Distribution of Wealth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(2), pages 299-316.
    9. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    10. Zareh Asatryan & Annika Havlik & Frank Streif, 2017. "Vetoing and inaugurating policy like others do: evidence on spatial interactions in voter initiatives," Public Choice, Springer, vol. 172(3), pages 525-544, September.
    11. Kersting, Felix & Wohnsiedler, Iris & Wolf, Nikolaus, 2020. "Weber Revisited: The Protestant Ethic and the Spirit of Nationalism," The Journal of Economic History, Cambridge University Press, vol. 80(3), pages 710-745, September.
    12. Oded Galor & Omer Moav & Dietrich Vollrath, 2009. "Inequality in Landownership, the Emergence of Human-Capital Promoting Institutions, and the Great Divergence," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(1), pages 143-179.
    13. Vincenzo Galasso & Paola Profeta, 2018. "When the State Mirrors the Family: The Design of Pension Systems," Journal of the European Economic Association, European Economic Association, vol. 16(6), pages 1712-1763.
    14. Nico Voigtländer & Hans-Joachim Voth, 2012. "Persecution Perpetuated: The Medieval Origins of Anti-Semitic Violence in Nazi Germany," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1339-1392.
    15. Buggle, Johannes C., 2016. "Law and social capital: Evidence from the Code Napoleon in Germany," European Economic Review, Elsevier, vol. 87(C), pages 148-175.
    16. Robert B. Ekelund, Jr. & Robert F. Hebert & Robert D. Tollison, 2002. "An Economic Analysis of the Protestant Reformation," Journal of Political Economy, University of Chicago Press, vol. 110(3), pages 646-671, June.
    17. Alston, Lee J. & Schapiro, Morton Owen, 1984. "Inheritance Laws Across Colonies: Causes and Consequences," The Journal of Economic History, Cambridge University Press, vol. 44(2), pages 277-287, June.
    18. Maarten Bosker & Eltjo Buringh & Jan Luiten van Zanden, 2013. "From Baghdad to London: Unraveling Urban Development in Europe, the Middle East, and North Africa, 800–1800," The Review of Economics and Statistics, MIT Press, vol. 95(4), pages 1418-1437, October.
    19. Hoyt Bleakley & Jeffrey Lin, 2012. "Portage and Path Dependence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(2), pages 587-644.
    20. Alfred Lameli & Volker Nitsch & Jens Südekum & Nikolaus Wolf, 2015. "Same Same But Different: Dialects and Trade," German Economic Review, Verein für Socialpolitik, vol. 16(3), pages 290-306, August.
    21. Wolf, Nikolaus & Caruana-Galizia, Paul, 2015. "Bombs, homes, and jobs: Revisiting the Oswald hypothesis for Germany," Economics Letters, Elsevier, vol. 135(C), pages 65-68.
    22. Kopsidis, Michael & Wolf, Nikolaus, 2012. "Agricultural Productivity Across Prussia During the Industrial Revolution: A Thünen Perspective," The Journal of Economic History, Cambridge University Press, vol. 72(3), pages 634-670, August.
    23. Michael Kopsidis & Nikolaus Wolf, 2012. "Agricultural Productivity Across Prussia During the Industrial Revolution: A ThŸnen Perspective," Working Papers 0013, European Historical Economics Society (EHES).
    24. Gary D. Hansen & Edward C. Prescott, 2002. "Malthus to Solow," American Economic Review, American Economic Association, vol. 92(4), pages 1205-1217, September.
    25. Bosker, Maarten & Buringh, Eltjo, 2017. "City seeds: Geography and the origins of the European city system," Journal of Urban Economics, Elsevier, vol. 98(C), pages 139-157.
    26. Becker, Sascha O. & Pfaff, Steven & Rubin, Jared, 2016. "Causes and consequences of the Protestant Reformation," Explorations in Economic History, Elsevier, vol. 62(C), pages 1-25.
    27. Huning, Thilo R. & Wahl, Fabian, 2021. "The origins of agricultural inheritance traditions," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 660-674.
    28. Christian Dustmann & Bernd Fitzenberger & Uta Sch?nberg & Alexandra Spitz-Oener, 2014. "From Sick Man of Europe to Economic Superstar: Germany's Resurgent Economy," Journal of Economic Perspectives, American Economic Association, vol. 28(1), pages 167-188, Winter.
    29. Wegge, Simone A., 1998. "Chain Migration and Information Networks: Evidence From Nineteenth-Century Hesse-Cassel," The Journal of Economic History, Cambridge University Press, vol. 58(4), pages 957-986, December.
    30. Sibylle Lehmann‐Hasemeyer & Fabian Wahl, 2021. "The German bank–growth nexus revisited: savings banks and economic growth in Prussia," Economic History Review, Economic History Society, vol. 74(1), pages 204-222, February.
    31. Alan S. Blinder, 1973. "A Model of Inherited Wealth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(4), pages 608-626.
    32. Timothy W. Guinnane, 2002. "Delegated Monitors, Large and Small: Germany's Banking System, 1800–1914," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 73-124, March.
    33. Anselm Hager & Hanno Hilbig, 2019. "Do Inheritance Customs Affect Political and Social Inequality?," American Journal of Political Science, John Wiley & Sons, vol. 63(4), pages 758-773, October.
    34. Conley, T. G., 1999. "GMM estimation with cross sectional dependence," Journal of Econometrics, Elsevier, vol. 92(1), pages 1-45, September.
    35. Habakkuk, H. J., 1955. "Family Structure and Economic Change in Nineteenth-Century Europe," The Journal of Economic History, Cambridge University Press, vol. 15(1), pages 1-12, March.
    36. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    37. Abel Schumann, 2014. "Persistence of Population Shocks: Evidence from the Occupation of West Germany after World War II," American Economic Journal: Applied Economics, American Economic Association, vol. 6(3), pages 189-205, July.
    38. Graziella Bertocchi, 2006. "The Law of Primogeniture and the Transition from Landed Aristocracy to Industrial Democracy," Journal of Economic Growth, Springer, vol. 11(1), pages 43-70, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bartels, Charlotte & Jäger, Simon & Obergruber, Natalie, 2020. "Long-Term Effects of Equal Sharing: Evidence from Inheritance Rules for Land," IZA Discussion Papers 13665, Institute of Labor Economics (IZA).
    2. Huning, Thilo R. & Wahl, Fabian, 2023. "You reap what you know: Appropriability and the origin of European states," European Journal of Political Economy, Elsevier, vol. 79(C).
    3. Süß, Karolin, 2023. "Long-term effects of historical inheritance customs on household formation and gender disparities," Ruhr Economic Papers 1038, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    4. Michael Fritsch & Martin Obschonka & Fabian Wahl & Michael Wyrwich, 2021. "Cultural Imprinting: Ancient Origins of Entrepreneurship and Innovation in Germany," Jena Economics Research Papers 2021-012, Friedrich-Schiller-University Jena.
    5. Fritsch, Michael & Obschonka, Martin & Wahl, Fabian & Wyrwich, Michael, 2020. "The deep imprint of Roman sandals: Evidence of long-lasting effects of Roman rule on personality, economic performance, and well-being in Germany," Hohenheim Discussion Papers in Business, Economics and Social Sciences 05-2020, University of Hohenheim, Faculty of Business, Economics and Social Sciences.
    6. David E. Bloom & Victoria Y. Fan & Vadim Kufenko & Osondu Ogbuoji & Klaus Prettner & Gavin Yamey, 2021. "Going beyond GDP with a parsimonious indicator: inequality-adjusted healthy lifetime income," Vienna Yearbook of Population Research, Vienna Institute of Demography (VID) of the Austrian Academy of Sciences in Vienna, vol. 19(1), pages 127-140.
    7. Huning, Thilo R. & Wahl, Fabian, 2021. "The origins of agricultural inheritance traditions," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 660-674.
    8. Boberg-Fazlić, Nina & Lampe, Markus & Martinelli Lasheras, Pablo & Sharp, Paul, 2022. "Winners and losers from agrarian reform: Evidence from Danish land inequality 1682–1895," Journal of Development Economics, Elsevier, vol. 155(C).
    9. Kravtsova, Maria & Libman, Alexander, 2023. "Historical family structure as a predictor of liberal voting: Evidence from a century of Russian history," Economic Systems, Elsevier, vol. 47(2).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bartels, Charlotte & Jäger, Simon & Obergruber, Natalie, 2020. "Long-Term Effects of Equal Sharing: Evidence from Inheritance Rules for Land," IZA Discussion Papers 13665, Institute of Labor Economics (IZA).
    2. Hanlon, W.Walker & Heblich, Stephan, 2022. "History and urban economics," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    3. Natalie Obergruber, 2018. "Microeconometric Analysis of Individual and Institutional Determinants of Education and Occupational Choice," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 80.
    4. Fabian Wahl, 2017. "Does European development have Roman roots? Evidence from the German Limes," Journal of Economic Growth, Springer, vol. 22(3), pages 313-349, September.
    5. Quamrul H. Ashraf & Francesco Cinnirella & Oded Galor & Boris Gershman & Erik Hornung, 2017. "Capital-Skill Complementarity and the Emergence of Labor Emancipation," Working Papers 2017-1, Brown University, Department of Economics.
    6. Christian Ochsner, 2017. "Dismantled once, diverged forever? A quasi-natural experiment of Red Army misdeeds in post-WWII Europe," ifo Working Paper Series 240, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    7. Suesse, Marvin & Wolf, Nikolaus, 2020. "Rural transformation, inequality, and the origins of microfinance," Journal of Development Economics, Elsevier, vol. 143(C).
    8. Alexander Donges & Jean-Marie Meier & Rui C. Silva, 2023. "The Impact of Institutions on Innovation," Management Science, INFORMS, vol. 69(4), pages 1951-1974, April.
    9. Francesco Cinnirella & Erik Hornung, 2016. "Land Inequality, Education, and Marriage: Empirical Evidence from Nineteenth-Century Prussia," CESifo Working Paper Series 6072, CESifo.
    10. Wahl, Fabian, 2016. "Does medieval trade still matter? Historical trade centers, agglomeration and contemporary economic development," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 50-60.
    11. Breinlich, Holger & Ottaviano, Gianmarco I.P. & Temple, Jonathan R.W., 2014. "Regional Growth and Regional Decline," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 4, pages 683-779, Elsevier.
    12. Cinnirella, Francesco & Hornung, Erik, 2016. "Landownership concentration and the expansion of education," Journal of Development Economics, Elsevier, vol. 121(C), pages 135-152.
    13. Remi Jedwab & Noel D. Johnson & Mark Koyama, 2022. "The Economic Impact of the Black Death," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 132-178, March.
    14. Huning, Thilo R. & Wahl, Fabian, 2021. "The origins of agricultural inheritance traditions," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 660-674.
    15. Kukic, Leonard & Arslantas, Yasin, 2022. "Religious change and persistence in Bosnia: Poverty, conversions, and nationalism, 1468-2013," IFCS - Working Papers in Economic History.WH 35286, Universidad Carlos III de Madrid. Instituto Figuerola.
    16. Barsanetti, Bruno, 2021. "Cities on pre-Columbian paths," Journal of Urban Economics, Elsevier, vol. 122(C).
    17. Johnson, Noel D. & Koyama, Mark, 2017. "Jewish communities and city growth in preindustrial Europe," Journal of Development Economics, Elsevier, vol. 127(C), pages 339-354.
    18. Remi Jedwab & Felix Meier zu Selhausen & Alexander Moradi, 2022. "The economics of missionary expansion: evidence from Africa and implications for development," Journal of Economic Growth, Springer, vol. 27(2), pages 149-192, June.
    19. Adrian Chadi & Matthias Krapf, 2017. "The Protestant Fiscal Ethic: Religious Confession And Euro Skepticism In Germany," Economic Inquiry, Western Economic Association International, vol. 55(4), pages 1813-1832, October.
    20. Stelios Michalopoulos & Alireza Naghavi & Giovanni Prarolo, 2010. "Trade and Geography in the Economic Origins of Islam: Theory and Evidence," Working Papers 2010.75, Fondazione Eni Enrico Mattei.

    More about this item

    Keywords

    inheritance rules; sectoral change; regional economic development; Baden-Württemberg; spatial inequalities;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • N93 - Economic History - - Regional and Urban History - - - Europe: Pre-1913

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:hohdps:092019. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/fwhohde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.