Cultural vs. Economic Legacies of Empires: Evidence from the Partition of Poland

Cultural vs. Economic Legacies of Empires: Evidence from the Partition of Poland Irena Grosfeld and Ekaterina Zhuravskaya presented by Silvia Vannutelli September 19, 2016 Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 1 / 36

Motivation Growing literature on the links between distant historical events and current economic and political outcomes. For over a century, Poland lost its sovereignty and was divided among three empires: Russian empire, Kingdom of Prussia and Austrian (Habsburg) empire. Partitions of Poland offer a clean "historical experiment" to evaluate historical legacies of empires. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 2 / 36

Contribution Previous papers focus on average differences between empires. Here, use of Regression Discontinuity at the borders, account for overall spatial pattern. Consider many institutional, economic, cultural factors, potentially related to differences across empires, and show which of these differences persist today. Test whether empire legacies have an effect on actual political outcomes. Evidence of significant empire legacies in religiosity and democratic capital. On the other side, many economic and institutional differences, formed during the partition period, didn t persist. Postulate mechanism: presence vs absence of intra-family transmission. (differences in religiosity, passed through generations, are most persistent). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 3 / 36

Contribution Previous papers focus on average differences between empires. Here, use of Regression Discontinuity at the borders, account for overall spatial pattern. Consider many institutional, economic, cultural factors, potentially related to differences across empires, and show which of these differences persist today. Test whether empire legacies have an effect on actual political outcomes. Evidence of significant empire legacies in religiosity and democratic capital. On the other side, many economic and institutional differences, formed during the partition period, didn t persist. Postulate mechanism: presence vs absence of intra-family transmission. (differences in religiosity, passed through generations, are most persistent). rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 3 / 36

Outline 1 Context 2 Historical Framework 3 Theory Hypotheses 4 Methodology 5 Data Sources 6 Results 7 Conclusion Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 4 / 36

Context Literature Studies of empire legacies on contemporary European outcomes: Grosjean (2011): having being subjected to the same imperial institutions in the past leads to cultural similarity today. Becker et al. (2012): former Habsburg rule has a persistent effect on trust in government and reduces perception of corruption Eastern European states. Herbst and Rivkin(2013) and Bukowski (2014): persistent differences in quality of education across partitions due to the culture of inclusiveness in Austrian partition. Vaste literature on persistence of culture and institutions and their long-term effects on development: Effect of European colonization on colonies development, via impact of colonial rule on domestic institutions post-independence (Acemoglu et al. 2001, La Porta et al. 1998, Engerman and Sokoloff 2002). Historical origins of cultural norms, examining situations where individuals from different backgrounds have been brought into the same environment (Putnam 1993, Greif 1994, Guiso et al. 2008, Tabellini 2010). Specific studies on the historical origins of some particular contemporary behavior or social norm (Voigtländer and Voth 2012, Nunn and Wantchekon 2011). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 5 / 36

Historical Framework There s Something about Poland from 15th century on, all European powers had some interest in Poland: France, Sweden, Russia, Austria, the Germanic Empire (later, Prussia). Why??? Very strategic position, rich of natural resources (wheat and salt mines). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 6 / 36

Historical Framework A map of Poland before the partitions Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 7 / 36

Poland before the partitions Historical Framework Feudal agricultural country, low economic development, but incredibly advanced politically and culturally: quasi-democratic system, religious tolerance. Absence of central "state" power. Great power of local Church and local nobilty, which was able to elect the king and limit its power through veto in Parliament - "Democracy of the nobles". Multi-national. Multi-religious. Multi-linguistic. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 8 / 36

Historical Framework The three partitions: 1772, 1793 and 1795 1772:Russia, Austria and Prussia sign an agreement and simultaneously invade and occupy the provinces of, respectively, Livonia and Belarus, Galicia, and Royal Prussia - about 30 percent of land and half population map 1793: Poland adopts progressive constitution, transforming monarchy from elective to hereditary and suppressing nobility s veto power. Worrying for its potential renaissance, Russia invades Poland. Prussia agrees, in exchange of territories. 1795: nationwide "Kosciuszko" Uprising against the occupiers, inspired by French Revolution. Immediate reaction of Prussia and Russia, and agreement with Austria to wipe Poland off of the maps. 1815: after Napoleonic wars, Congress of Vienna determines a " fourth partition" among the three empires, that will last until 1918. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 9 / 36

Historical Framework Poland Partitions Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 10 / 36

Historical Framework Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 11 / 36

Three very different Empires Historical Framework Empires differ greatly in political institutions, culture and economic development, and as a result, in their economic and social policies toward Poland: Austria: administrative and cultural autonomy, local democratic institutions, religious freedom, no economic development. Prussia: heavy economic development, administrative efficiency, religious tolerance(until 1871), political and cultural oppression ( Germanization). Russia: religious repression, administrative corruption,, low economic development, violent political and cultural oppression (Russification). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 12 / 36

Three very different Empires Historical Framework Empires differ greatly in political institutions, culture and economic development, and as a result, in their economic and social policies toward Poland: Austria: administrative and cultural autonomy, local democratic institutions, religious freedom, no economic development. Prussia: heavy economic development, administrative efficiency, religious tolerance(until 1871), political and cultural oppression ( Germanization). Russia: religious repression, administrative corruption,, low economic development, violent political and cultural oppression (Russification). rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 12 / 36

Cultural vs economic legacies Theory Hypotheses the partition brought about divergence in culture, institutions and economic development. However, not all differences across empires are equally persistent. Literature on cultural transmission suggests that economic differences trigger integration, when arbitrage opportunities; in contrast, cultural differences push people to segregate. Economic integration and cultural segregation may coexist over long time. two potential cultural transmission mechanisms: intra-family (vertical) vs socialization (horizontal), the former is stronger. Cultural attributes transmitted via family upbringing are expected to be more persistent than economic outcomes and formal institutions. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 13 / 36

Cultural vs economic legacies Theory Hypotheses the partition brought about divergence in culture, institutions and economic development. However, not all differences across empires are equally persistent. Literature on cultural transmission suggests that economic differences trigger integration, when arbitrage opportunities; in contrast, cultural differences push people to segregate. Economic integration and cultural segregation may coexist over long time. two potential cultural transmission mechanisms: intra-family (vertical) vs socialization (horizontal), the former is stronger. Cultural attributes transmitted via family upbringing are expected to be more persistent than economic outcomes and formal institutions. rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 13 / 36

Theory Hypotheses Political legacies Polish political space defined along 3 ideological dimensions: (1) attachment to cultural freedom and tolerance (e.g. role of religion in public life); (2) extent of economic liberalism and local autonomy; (3) attitude towards communist past. Political outcomes don t have a direct connection to the difference among empires, but political scientists claim political map of Poland matches partitions -> if there is an effect, it must come from the influence of the cultural or economic legacies. map In presence of discontinuities in political outcomes at the borders, test whether votes for main political parties is related to fundamental legacies of empires within regions of poland with common histories. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 14 / 36

Theory Hypotheses Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silvia vs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 15 / 36

Methodology Econometric Strategy - I Spatial Regression Discontinuity: look at municipalities around Austria-Russia and Russia-Prussia borders to estimate locally the impact of empires. Variables that exhibit a significant jump at the borders are considered as outcomes of the empire influence. main identifying assumptions: 1) borders were set fairly arbitrarily by the partition powers and do not correspond to any pre-existing discontinuous differences. 2) spatial patterns of all (observable and unobservable) factors of interest, other than empire influence, should be smooth at the partition borders. Problem: assumption 1) is essentially untestable due to lack of data. However, historical evidence consistent with it. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 16 / 36

Methodology Econometric Strategy - I Spatial Regression Discontinuity: look at municipalities around Austria-Russia and Russia-Prussia borders to estimate locally the impact of empires. Variables that exhibit a significant jump at the borders are considered as outcomes of the empire influence. main identifying assumptions: 1) borders were set fairly arbitrarily by the partition powers and do not correspond to any pre-existing discontinuous differences. 2) spatial patterns of all (observable and unobservable) factors of interest, other than empire influence, should be smooth at the partition borders. Problem: assumption 1) is essentially untestable due to lack of data. However, historical evidence consistent with it. rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 16 / 36

Methodology Econometric Strategy - II Bandwidth set at 60 kilometers (link). two empirical specifications: one-dimensional - uses Euclidian distance as the forcing variable: Outcome i = αempire i + δ 1 Dist i + δ 2 Dist i Empire i + γ 1 x i + γ 2 y i + C i β + ɛ i (1) two-dimensional - controls flexibly for the geolocation: Outcome i = αempire i + f (x i, y i ) + C i β + ɛ i (2) Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 17 / 36

Counties in Borders bandwidth Methodology Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 18 / 36

Data Sources Data Sources Census and GUS (2002): Census for municipality data on population, level of education, and unemployment. GUS County-level data for wages, industrial production per capita, employment in services and finance. Social diagnosis Survey on attitudes: individual-level responses on subjective church attendance, attitudes towards democracy, trust in government, police and courts, propensity to violate laws and to use bribes for administrative matters. Polish Institute of Statistics of the Catholic Church (2008): objective municipality data on church attendance. DIVA-GIS, NOAA and historical sources: digital maps of Poland s partitions, centroids of each municipality and distance from the borders, number of railways, average luminosity, geographic characteristics. Official Electoral Commission: election data on the last four national elections (2001, 2005, 2007, 2011). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 19 / 36

Results Cultural Legacies - Religiosity Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 20 / 36

Results Cultural Legacies - beliefs in Democracy Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 21 / 36

Results Cultural Legacies Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 22 / 36

Results Economic Legacies Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 24 / 36

Results Economic Legacies - Discontinuity Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 25 / 36

Results Economic Legacies - no discontinuity Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 26 / 36

Results Political Outcomes Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 27 / 36

Results Political Outcomes and Empire Legacies Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 29 / 36

Results Summary of Results - Cultural vs. Economic Effects Differences in incomes, industrialization (except for infrastructure), education, corruption, and trust in government institutions disappeared with time, smoothed by economic forces and policy intervention. In contrast, differences in cultural attitudes persisted, presumably via inter-generational family transmission. In particular: Prussian empire, more industrialized -> denser railroad network; Hasburg Empire, more autonomy -> creation of persistent democratic capital; Russian empire, religious oppression -> persistent lower religiosity. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 31 / 36

Results Summary of Results - Cultural vs. Economic Effects Differences in incomes, industrialization (except for infrastructure), education, corruption, and trust in government institutions disappeared with time, smoothed by economic forces and policy intervention. In contrast, differences in cultural attitudes persisted, presumably via inter-generational family transmission. In particular: Prussian empire, more industrialized -> denser railroad network; Hasburg Empire, more autonomy -> creation of persistent democratic capital; Russian empire, religious oppression -> persistent lower religiosity. rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 31 / 36

Results Summary of Results - Political Effects Support for Religious Conservatives and for liberals exhibits a significant discontinuous jump at the Russia-Austria border (robust across specifications). Religiosity is a significant determinant of the vote for Religious Conservatives and for the Left. Belief in democracy and railway intensity are significant predictors of the vote for Liberals with a much larger magnitude of the effect of the democratic capital. These correlations confirm that the effect of empires on religiosity and democratic capital are the channels through which empires have an effect on current political outcomes on the Russia-Austria border. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 32 / 36

Results Discussion and Robustness "Placebo" experiment: move each border in 2 opposite directions. Run placebo RD estimation. Significant results appear at the same rate for both smooth and discontinuous outcomes at the real historical borders. Use alternative polynomial functional forms for the one-dimensional RD, change the bandwidth and allow for spatial correlation of the errors. Re-run regression excluding localities exactly at the borders (concern that the border effect was driven by presence of guards at the border). Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 33 / 36

Conclusion Conclusion Significant evidence of legacy of past empires on contemporary outcomes, but different persistence: cultural factors are more persistent than economic ones. Cultural empire legacies have an effect on contemporary political outcomes. very good paper, no "econometrics applied to historical data", but more history guiding economic analysis of current data. clean ad effective, useful example for future work: borders changed a lot over history, so lot of potential to explore. Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 34 / 36

Conclusion Conclusion Significant evidence of legacy of past empires on contemporary outcomes, but different persistence: cultural factors are more persistent than economic ones. Cultural empire legacies have an effect on contemporary political outcomes. very good paper, no "econometrics applied to historical data", but more history guiding economic analysis of current data. clean ad effective, useful example for future work: borders changed a lot over history, so lot of potential to explore. rena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 34 / 36

Conclusion Berlin "Pro-Religion" Referendum 2009 - Another legacy? Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 35 / 36

Conclusion Dziekuje Irena Grosfeld and Ekaterina Zhuravskaya (presented by Cultural Silviavs. Vannutelli) Economic Legacies of Empires: Evidence from the Partition of Poland September 19, 2016 36 / 36