From Farmers to Merchants: A Human Capital Interpretation of Jewish Economic History

43 Pages Posted: 25 Jan 2003

See all articles by Maristella Botticini

Maristella Botticini

Bocconi University - Department of Economics

Zvi Eckstein

The Interdisciplinary Center (IDC); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

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Date Written: December 2002

Abstract

Since the Middle Ages the Jews have been engaged primarily in Urban, skilled occupations, such as crafts, trade, finance, and medicine. This distinctive occupational selection occurred between the seventh and the ninth centuries in the Muslim Empire and then it spread to other locations. We argue that this transition was the outcome of the widespread literacy among Jews prompted by an educational reform in the first century CE. Based on the growing nexus between education and Judaism in the first half of the millennium, we build a model in which Jewish men choose education, occupation, religion, and location. The model predicts that when urbanization expands (as it did in the Muslim Empire), Jews move to new cities due to their comparative advantage in urban, skilled occupations. Furthermore, before urbanization a proportion of Jewish farmers are predicted to convert to other religions. The predictions of the model regarding conversions, migrations, and reduction in the size of the Jewish population are consistent with the historical evidence about the first millennium provided by the historians. Hence, our study presents evidence for the long-term economic implications of changes in social norms.

Keywords: Jewish Economic History, Human Capital, Religion, Social Norms, Migration, Occupational Choice, First Millennium

JEL Classification: N3, O1, J1, J2, Z1

Suggested Citation

Botticini, Maristella and Eckstein, Zvi, From Farmers to Merchants: A Human Capital Interpretation of Jewish Economic History (December 2002). IZA Discussion Paper No. 670, Available at SSRN: https://ssrn.com/abstract=357041 or http://dx.doi.org/10.2139/ssrn.357041

Maristella Botticini (Contact Author)

Bocconi University - Department of Economics ( email )

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Zvi Eckstein

The Interdisciplinary Center (IDC) ( email )

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IZA Institute of Labor Economics

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