nhaliday + acemoglu + urban   1

Market Integration as a Mechanism of Growth∗
In what sense are institutions a deep determinant of growth? In this paper, we address this question by examining the relationship between city growth and institutional reform in 19th century Germany, when some cities experienced deep institutional reform as a result of French rule. Employing an instrumental-variables approach, we find there is a hierarchy of growth factors in which institutions affect market integration more than market integration affects institutions. It was institutional improvements that were crucial to market integration, rather than just declining transport costs, which increased city growth during this time period. The institutional reforms, however, were transmitted through the mechanism of market integration. This created a much larger impact on city growth compared to the institutional impact independent from the market integration mechanism. The approach we take can be applied to other causes of economic growth.
pdf  study  economics  growth-econ  institutions  urban  cliometrics  europe  germanic  gallic  natural-experiment  path-dependence  acemoglu  pseudoE  divergence  political-econ  roots  capitalism  cultural-dynamics  conquest-empire  broad-econ  branches  urban-rural  hari-seldon 
january 2017 by nhaliday

bundles : econinterlockingpeeps

Copy this bookmark:



description:


tags: