State Capacity and the Post Office: Evidence from 19th Century Quebec

35 Pages Posted: 23 Feb 2020

See all articles by Vincent Geloso

Vincent Geloso

Bates College; University of Western Ontario - King's University College

Michael Makovi

Texas Tech University, College of Agricultural Sciences and Natural Resources, Department of Agricultural and Applied Economics; Texas Tech University - Free Market Institute

Date Written: January 27, 2020

Abstract

The theory of state capacity predicts that states with powerful abilities — as long as they are constrained — can promote economic growth, because these abilities can serve to support market development. A difficulty in the study of state capacity relates to its measurement. Some scholars, especially in economic history, argue that post offices area proxy for government effectiveness and state capacity (Chong et al., 2014; Acemoglu et al., 2016; Rogowski et al., 2017; Jensen and Ramey, 2019), because a well-functioning communication network helps markets operate. We test whether this claim is generalizable by using data from nineteenth century Quebec. We use a difference-in-difference method to estimate the effect of gaining, or losing, a post office on the value of agricultural output per acre between 1831 and 1861. We find no treatment effect, implying that post offices had no relationship with agricultural productivity. This may suggest that post offices are not a valid proxy for state capacity or, at the very least, that they do not constitute generalizable evidence.

Keywords: State Capacity, Economic History, Post Office, Canada, Quebec

JEL Classification: H11, N41, N51

Suggested Citation

Geloso, Vincent and Makovi, Michael, State Capacity and the Post Office: Evidence from 19th Century Quebec (January 27, 2020). Available at SSRN: https://ssrn.com/abstract=3526153 or http://dx.doi.org/10.2139/ssrn.3526153

Vincent Geloso (Contact Author)

Bates College ( email )

Department of Economics
Lewiston, ME
United States

University of Western Ontario - King's University College ( email )

266 Epworth Avenue
London, Ontario N6A 2M3
Canada

Michael Makovi

Texas Tech University, College of Agricultural Sciences and Natural Resources, Department of Agricultural and Applied Economics ( email )

Box 42132
Lubbock, TX 79409-2132
United States

Texas Tech University - Free Market Institute ( email )

Box 45059
Lubbock, TX 79409-5059
United States

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