Published on
19/08/2024
Abstract:
How do radical reforms shape economic development over time? In 1790, the French Assembly overhauled the kingdom's organization to establish new local capitals. In some new artificial departments, the choice of capitals was plausibly exogenous. We study how changes in administrative presence affect state capacity and development in the ensuing decades. In the short run, proximity to the state increases taxation and law enforcement. In the long run, capitals obtain more public goods and grow faster. Our results shed light on the dynamic impacts of state-building in the context of one of history's most ambitious administrative reforms.
How do radical reforms shape economic development over time? In 1790, the French Assembly overhauled the kingdom's organization to establish new local capitals. In some new artificial departments, the choice of capitals was plausibly exogenous. We study how changes in administrative presence affect state capacity and development in the ensuing decades. In the short run, proximity to the state increases taxation and law enforcement. In the long run, capitals obtain more public goods and grow faster. Our results shed light on the dynamic impacts of state-building in the context of one of history's most ambitious administrative reforms.