B08
Competition between States and the Historical Roots of Identity
Discussion Papers

Discussion Paper No. 199
November 13, 2019

Weber Revisited: The Protestant Ethic and the Spirit of Nationalism

Author:

Kersting, Felix (HU Berlin)
Wohnsiedler, Iris (HU Berlin)
Wolf, Nikolaus (HU Berlin)

Abstract:

We revisit Max Weber's hypothesis on the role of Protestantism for economic development. We show that nationalism is crucial to both, the interpretation of Weber's Protestant Ethic and empirical tests thereof. For late 19th century Prussia we reject Weber’s suggestion that Protestantism mattered due to an “ascetic compulsion to save”. Moreover, we find that income levels, savings, and literacy rates differed between Germans and Poles, not between Protestants and Catholics using pooled OLS and IV regressions as well as IV mediation analysis. We suggest that this result is due to anti-Polish discrimination.

Keywords:

Max Weber; protestantism; nationalism

JEL-Classification:

N13; N33; O16; Z12

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Discussion Paper No. 172
July 30, 2019

The Rise of Fiscal Capacity

Authors:

Cantoni, Davide (LMU Munich)
Mohr, Cathrin (LMU Munich)
Weigand, Matthias (LMU Munich)

Abstract:

Having sufficient fiscal capacity to tax is a key hallmark and defining feature of states, and there is a growing literature trying to explain its origins. Existing empirical evidence on fiscal capacity is scarce and focuses on large, ex-post successful territories. In this paper we study the introduction of the first centralized, permanent fiscal institutions in the multifarious territories of the Holy Roman Empire from 1400 to 1800. We link information on fiscal centralization and the size and survival of territories to an extensive dataset on state-formation and growth-related outcomes. We empirically confirm that territories are more likely to centralize when neighboring territories are centralized and when they are exposed to a higher threat of war. In line with the literature on the consequences of fiscal capacity, we show that centralized territories are more likely to survive than non-centralized territories and as a result grow more in size. They invest more in administrative and military structures, but investments in the military only occur in the core areas of centralized territories. This contradicts the central assumption of models on fiscal capacity which states that investments into the military are a non-excludable public good.

Keywords:

JEL-Classification:

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Discussion Paper No. 143
February 27, 2019

Persistence and Activation of Right-Wing Political Ideology

Authors:

Cantoni, Davide (LMU Munich and CESifo)
Hagemeister, Felix (LMU Munich)
Westcott, Mark (Vivid Economics)

Abstract:

We argue that a long-run cultural persistence of right-wing ideology can explain the recent rise of right-wing populism. Shifts in the supply of party platforms can interact with this existing demand, and give rise to patterns of historical persistence. We study the context of Germany in the 2017 federal election, when the emergence of the AfD offered voters a populist right-wing option, with little social stigma attached. We show that municipalities that expressed strong support for the Nazi party in 1933 are more likely to vote for the AfD now, but not in 2013, when the AfD was a more moderate, fiscally conservative party. Using opinion surveys, we show that these dynamics are not generated by a concurrent demand shift: political attitudes do not shift sharply to the right in the municipalities with a history of Nazi support.

Keywords:

persistence; culture; right-wing ideology; germany

JEL-Classification:

D72; N44; P16

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Discussion Paper No. 52
November 2, 2017

Coal and Blood: Industrialization and the Rise of Nationalism in Prussia before 1914

Author:

Kersting, Felix (Humboldt-Universität zu Berlin)

Abstract:

Industrialization and the rise of nationalism were the two major developments in Germany before the World War I. A novel county-level dataset reveals that industrialization and nationalism measured by membership in the "Kriegervereine'", the biggest civil organization at the time, were negatively correlated. Using coal potential as an IV for identification, I find strong evidence for a causal impact of industrialization on nationalism. In order to detect possible mechanisms, a three stage IV regression model produces strong support that migration and trade union membership were crucial factors that linked industrialization and nationalism.

Keywords:

nationalism; industrialization; prussia

JEL-Classification:

F06; N13; N33

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