Working Paper: CEPR ID: DP6751
Authors: Oded Galor; Omer Moav; Dietrich Vollrath
Abstract: This paper suggests that inequality in the distribution of land ownership adversely affected the emergence of human capital promoting institutions (e.g., public schooling) and thus the pace and the nature of the transition from an agricultural to an industrial economy, contributing to the emergence of the great divergence in income per capita across countries. The prediction of the theory regarding the adverse effect of the concentration of land ownership on education expenditure is established empirically based on evidence from the beginning of the 20th century in the US.
Keywords: geography; great divergence; growth; human capital; institutions; land inequality
JEL Codes: O10; O40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| land ownership inequality (Q15) | emergence of human capital promoting institutions (J24) |
| land ownership inequality (Q15) | education expenditure (H52) |
| education expenditure (H52) | transition from agricultural to industrial economy (N53) |
| land concentration (Q24) | education expenditure (H52) |
| land ownership inequality (Q15) | economic growth (O49) |
| equal land distribution (D30) | effective public education policies (H52) |
| effective public education policies (H52) | skill-intensive industrial sector (J24) |