The Economic Legacy of Warfare: Evidence from European Regions

46 Pages Posted: 12 Jul 2015 Last revised: 14 Sep 2017

See all articles by Traviss Cassidy

Traviss Cassidy

University of Alabama

Mark Dincecco

University of Michigan at Ann Arbor

Massimiliano Gaetano Onorato

University of Bologna - Department of Economics

Date Written: September 12, 2017

Abstract

This paper shows new evidence that, counterintuitively, the economic legacy of warfare can be positive. We use geocoded data on historical conflict locations in Europe to construct estimates of local exposure to past warfare. We document a positive and significant relationship between historical conflict exposure and regional economic development levels today. This result is robust to controls for initial demography, local geographical features, and country fixed effects. To further account for the possibility of omitted variable bias, we perform an instrumental variables analysis. We find that agglomeration effects, technological innovation, and urban manufacturing were channels through which historical warfare translated into long-run regional development.

Keywords: historical warfare, legacy of warfare, economic development, sub-national level, Europe

JEL Classification: O10, N40, N90, P48, R11

Suggested Citation

Cassidy, Traviss and Dincecco, Mark and Onorato, Massimiliano Gaetano, The Economic Legacy of Warfare: Evidence from European Regions (September 12, 2017). Available at SSRN: https://ssrn.com/abstract=2629326 or http://dx.doi.org/10.2139/ssrn.2629326

Traviss Cassidy

University of Alabama ( email )

P.O. Box 870244
Tuscaloosa, AL 35487
United States

Mark Dincecco (Contact Author)

University of Michigan at Ann Arbor ( email )

HOME PAGE: http://sites.google.com/umich.edu/dincecco

Massimiliano Gaetano Onorato

University of Bologna - Department of Economics ( email )

Bologna
Italy

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