Working Paper: CEPR ID: DP12822
Authors: Quamrul Ashraf; Francesco Cinnirella; Oded Galor; Boris Gershman; Erik Hornung
Abstract: This paper advances a novel hypothesis regarding the historical roots of labor emancipation. Itargues that the decline of coercive labor institutions in the industrial phase of developmenthas been an inevitable by-product of the intensification of capital-skill complementarity inthe production process. In light of the growing significance of skilled labor for fostering thereturn to physical capital, elites in society were induced to relinquish their historically profitablecoercion of labor in favor of employing free skilled workers, thereby incentivizing the masses toengage in broad-based human capital acquisition, without fear of losing their skill premium toexpropriation. In line with the proposed hypothesis, exploiting a plausibly exogenous sourceof variation in proto-industrialization across regions of nineteenth-century Prussia, the initialabundance of elite-owned physical capital that also came to be associated with skill-intensiveindustrialization is shown to have contributed to the subsequent intensity of de facto serfemancipation.
Keywords: Labor; Coercion; Serfdom; Emancipation; Industrialization; Physical Capital Accumulation; Capital-Skill Complementarity; Demand for Human Capital; Nineteenth-Century Prussia
JEL Codes: J24; J47; N13; N33; O14; O15; O43
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| accumulation of physical capital by landowning elites (E22) | shift in economic incentives away from coercive labor practices (J47) |
| shift in economic incentives away from coercive labor practices (J47) | employing free skilled workers (J68) |
| initial abundance of elite-owned physical capital (D33) | broader human capital acquisition among the masses (J24) |
| initial abundance of elite-owned physical capital (D33) | intensity of de facto serf emancipation (P39) |
| initial abundance of elite-owned physical capital (D33) | share of serfs de facto emancipated (P32) |
| initial abundance of elite-owned physical capital (D33) | decline of coercive labor practices (J47) |