Women's Liberation as a Financial Innovation

Abstract

In one of the greatest extensions of property rights in human history, common law countries began giving rights to married women in the 1850s. Before this "women's liberation," the doctrine of coverture strongly incentivized parents of daughters to hold real estate, rather than financial assets such as money, stocks, or bonds. We exploit the staggered nature of coverture's demise across US states to show that women's rights led to shifts in household portfolios; a positive shock to the supply of credit; and a reallocation of labor towards non-agriculture and capital intensive industries. Investor protection deepened financial markets aiding industrialization.

Keywords: Women's liberation, financial innovation, investor protection, economic growth

JEL Classification: E02, E44, G11, J12, K11, K36, N11, N21, O11