TY  - JOUR
TI  - Warfare, Fiscal Capacity, and Performance
SP  - 171
AV  - public
KW  - JEL Classification:  C20; H10; O10; N40; Keywords: Pre-modern wars
KW  -  Fiscal capacity
KW  -  Public services
KW  -  Worker productivity
Y1  - 2012/09//
UR  - http://dx.doi.org/10.1007/s10887-012-9079-4
A1  - Dincecco, Mark
A1  - Prado, Mauricio
VL  - 17
EP  - 203
ID  - eprints1233
N2  - We exploit differences in casualties sustained in pre-modern wars to estimate the impact of fiscal capacity on economic performance. In the past, states fought different amounts of external conflicts, of various lengths and magnitudes. To raise the revenues to wage wars, states made fiscal innovations, which persisted and helped to shape current fiscal institutions. Economic historians claim that greater fiscal capacity was the key long-run institutional change brought about by historical conflicts. Using casualties sustained in pre-modern wars to instrument for current fiscal institutions, we estimate substantial impacts of fiscal capacity on GDP per worker. The results are robust to a broad range of specifications, controls, and sub-samples.

SN  - 1381-4338
IS  - 3
JF  - Journal of Economic Growth
PB  - Springer-Verlag
ER  -