The Second World War, Inequality and the Social Contract in Britain

Abstract

What is the impact of warfare on inequality and the social contract? Using local data on bombing, the evolution of wealth inequality and vote shares for the Labour Party in Britain around the Second World War, we establish two results. First, on average, we find no impact of bombing on inequality. However, there is considerable heterogeneity, and this result is driven by southern Britain. In northern Britain, bombing led to significant falls in inequality. Second, heavier bombing led to a significant increase in the vote share for Labour after the war everywhere, but this effect is transitory in the south while it is permanent in the north. Our results obtain both in a simple difference‐in‐differences framework as well as in a panel‐regression discontinuity framework in which we exploit the limited range of German fighter escort planes. Our results provide novel causal evidence for the inequality‐reducing impact of warfare, and we interpret them as consistent with the notion that the impact of the war also led to a reconfiguration of the social contract in Britain.

The Political Effects of the 1918 Influenza Pandemic in Weimar Germany

“…Section III introduces the main data sets, while Section IV details out how we estimate 12 Health shocks differ from other types of shocks such as wars because they have little impact on physical capital (Jordà et al, 2022) and thus do not affect the wealth distribution. It is therefore unlikely that the influenza pandemic affected voting behavior via changes in wealth inequality similar to the way WWII increased votes for the Labour party in England, as found by Heldring et al (2022). Nevertheless, if the pandemic led to sorting, it may have had an effect on the geography of poverty, wealth, and voting patterns (Ambrus et al, 2020).…”

The Political Effects of the 1918 Influenza Pandemic in Weimar Germany

“…Section III introduces the main data sets, while Section IV details out how we estimate 12 Health shocks differ from other types of shocks such as wars because they have little impact on physical capital (Jordà et al, 2022) and thus do not affect the wealth distribution. It is therefore unlikely that the influenza pandemic affected voting behavior via changes in wealth inequality similar to the way WWII increased votes for the Labour party in England, as found by Heldring et al (2022). Nevertheless, if the pandemic led to sorting, it may have had an effect on the geography of poverty, wealth, and voting patterns (Ambrus et al, 2020).…”

Origins of Latin American Inequality

“…We thank Aldo Musacchio for suggesting this point.19 In the region, Alix-Garcia, Schechter, Valencia Caicedo, and Zhu (2022) look at the multifaceted impact of the War of the Triple Alliance, but do not focus on inequality per se. Related,Heldring, Robinson, and Whitfill (2022) explore the relationship between conflict and inequality in England.…”