Working Paper: CEPR ID: DP15434
Authors: Laura Panza
Abstract: This paper investigates the impact of the disruption of the Ottoman Empire on the integration of regional and colonial commodity markets in the Near East. Exploiting a novel dataset on commodity prices in Syria, Egypt, Turkey, France and the UK covering the 1787-1939 period, it assesses the extent of price dispersion across markets before and after the end of the Ottoman Empire and investigates the causes behind the change in market integration. The results indicate that while regional markets disintegrated throughout the period, reflecting the anti-global environment of the interwar era, colonial market linkages strengthened. The empirical findings also highlight that border effects, rather the rise of protection per se, were the main drivers behind the increase of regional price dispersion.
Keywords: market integration; Near East; colonial linkages; interwar era
JEL Codes: N75; N95
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| end of the Ottoman Empire (N93) | increase in price dispersion among regional markets (D49) |
| new national borders (F55) | increase in price dispersion among regional markets (D49) |
| increased protectionist policies (F52) | increase in price dispersion among regional markets (D49) |
| being part of the same empire (F54) | decrease in price gaps (D41) |
| increase in tariff rates (F13) | null result in price gaps (D41) |
| border effects (F55) | increase in price dispersion (D49) |
| historical trade links (N73) | decrease in market integration (F15) |
| creation of new regulatory institutions (D02) | decrease in market integration (F15) |
| rise of nationalism (F52) | decrease in market integration (F15) |