Reversing fortunes of German regions, 1926–2019: Boon and bane of early industrialization?
Paul Berbée,
Sebastian Till Braun,
Richard Franke
Abstract:This paper shows that nineteenth-century industrialization is an essential determinant of the pronounced changes in economic prosperity across German regions over the last 100 years. Using novel data on economic activity in 163 labor market regions in West Germany, we find that nearly half of them experienced a reversal of fortune, moving from the lower to the upper median of the income distribution or vice versa, between 1926 and 2019. Exploiting plausibly exogenous variation in access to coal, we show that e… Show more
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