Did Protestantism promote economic prosperity via higher human capital?

Edwards, Jeremy (2017): Did Protestantism promote economic prosperity via higher human capital?

Abstract

This paper investigates the Becker-Woessmann (2009) argument that Protestants were more prosperous in nineteenth-century Prussia because they were more literate, a version of the Weber thesis, and shows that it cannot be sustained. The econometric analysis on which Becker and Woessman based their argument is fundamentally flawed, because their instrumental variable does not satisfy the exclusion restriction. When an appropriate instrumental-variable specification is used, the evidence from nineteenth-century Prussia rejects the human-capital version of the Weber thesis put forward by Becker and Woessmann.

• Item Type: MPRA Paper
• Language: English
• Keywords: Human capital, Protestantism, economic history, instrumental variables
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C26 - Instrumental Variables (IV) Estimation; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I20 - General; N - Economic History > N3 - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy > N33 - Europe: Pre-1913; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z12 - Religion

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