The Origins and Long-Run Consequences of the Division of Labor

Depetris-Chauvin, Emilio and Özak, Ömer (2016): The Origins and Long-Run Consequences of the Division of Labor.

Abstract

This research explores the deep historical roots and persistent effects of the division of labor in pre-modern societies. It advances the hypothesis, and establishes empirically that population diversity had a positive causal effect on the division of labor. Based on a novel ethnic level dataset combining geocoded ethnographic, linguistic and genetic data, this research exploits the exogenous variation in population diversity generated by historical migratory patterns to causally establish that higher levels of population diversity were conducive to economic specialization and the emergence of trade-related institutions that, in turn, translated into differences in pre-modern comparative development. Additionally, this research provides suggestive evidence that regions historically inhabited by pre-modern societies with higher levels of economic specialization have higher levels of contemporary occupational heterogeneity, economic complexity and development.

• Item Type: MPRA Paper
• Language: English
• Keywords: Economic Specialization, Division of Labor, Trade, Comparative Development, Economic Development, Human Capital, Skill-Bias, Population Diversity, Genetic Diversity, Linguistic Diversity, Cultural Diversity, Persistence, Serial Founder Effect
• Subjects: D - Microeconomics > D7 - Analysis of Collective Decision-Making > D74 - Conflict ; Conflict Resolution ; Alliances ; Revolutions; F - International Economics > F1 - Trade > F10 - General; F - International Economics > F1 - Trade > F14 - Empirical Studies of Trade; J - Labor and Demographic Economics > J2 - Demand and Supply of Labor > J24 - Human Capital ; Skills ; Occupational Choice ; Labor Productivity; N - Economic History > N1 - Macroeconomics and Monetary Economics ; Industrial Structure ; Growth ; Fluctuations > N10 - General, International, or Comparative; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O10 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O11 - Macroeconomic Analyses of Economic Development; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O12 - Microeconomic Analyses of Economic Development; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O43 - Institutions and Growth; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O44 - Environment and Growth; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z10 - General; Z - Other Special Topics > Z1 - Cultural Economics ; Economic Sociology ; Economic Anthropology > Z13 - Economic Sociology ; Economic Anthropology ; Social and Economic Stratification

References

Acemoglu, D., Johnson, S. and Robinson, J. (2005). Institutions as a fundamental cause of long-run growth, Handbook of economic growth 1: 385–472.

Ahlerup, P. and Olsson, O. (2012). The roots of ethnic diversity, Journal of Economic Growth 17(2): 71–102.

Alesina, A., Devleeschauwer, A., Easterly, W., Kurlat, S. and Wacziarg, R. T. (2003). Fractionalization, Journal of Economic Growth 8(2): 155–194.

Alesina, A., Giuliano, P. and Nunn, N. (2013). On the origins of gender roles: Women and the plough, The Quarterly Journal of Economics 128(2): 469–530.

Alesina, A., Harnoss, J. and Rapoport, H. (2016). Birthplace diversity and economic prosperity, Journal of Economic Growth 21(2): 101–138.

Altonji, J. G., Elder, T. E. and Taber, C. R. (2005). Selection on observed and unobserved variables: Assessing the effectiveness of catholic schools, Journal of Political Economy 113(1): 151–184.

Arbatli, E., Ashraf, Q. and Galor, O. (2013). The nature of civil conflict, Working Paper, Brown University, Department of Economics.

Ashraf, Q. and Galor, O. (2011). Dynamics and stagnation in the malthusian epoch, The American Economic Review 101(5): 2003–2041.

Ashraf, Q. and Galor, O. (2013a). Genetic diversity and the origins of cultural fragmentation, TheAmerican Economic Review 103(3): 528–533.

Ashraf, Q. and Galor, O. (2013b). The out of africa hypothesis, human genetic diversity, and comparative economic development, The American Economic Review 103(1): 1–46.

Atkinson, Q. D. (2011). Phonemic diversity supports a serial founder effect model of language expansion from africa, Science 332(6027): 346–349.

Baker, A. J. and Jenkins, P. F. (1987). Founder effect and cultural evolution of songs in an isolated population of chaffinches, fringilla coelebs, in the chatham islands, Animal Behaviour 35(6): 1793–1803.

Barry, H. (1982). Cross-cultural codes on contributions by women to subsistence, Ethnology: An international journal of cultural and social anthropology 21(2): 165–188.

Basu, S. and Waymire, G. B. (2006). Recordkeeping and human evolution, Accounting Horizons 20(3): 201–229.

Bellows, J. and Miguel, E. (2009). War and local collective action in sierra leone, Journal of Public Economics 93(11): 1144–1157.

Berosus and Burstein, S. M. (1978). The Babyloniaca of Berossus, Vol. v. 1, fasc. 5 of Sources from the ancient Near East, 2nd print. with minor corrections edn, Undena Publications, Malibu.

Betti, L., Balloux, F., Amos, W., Hanihara, T. and Manica, A. (2009). Distance from africa, not climate, explains within-population phenotypic diversity in humans, Proceedings of the Royal Society of London B: Biological Sciences 276(1658): 809–814.

Birchenall, J. A. (2014). Disease and diversity in africa’s long-term economic development, Technical report, University of California Santa Barbara.

Bisson, M. S. (1982). Trade and tribute. archaeological evidence for the origin of states in south central africa (commerce et tribut. documents archéologiques sur l’origine des états du sud de l’afrique centrale), Cahiers d’études africaines pp. 343–361.

Boix, C. (2015). Political order and inequality: their foundations and their consequences for human welfare, Cambridge studies in comparative politics, Cambridge University Press.

Borland, J. and Yang, X. (1992). Specialization and a new approach to economic organization and growth, The American Economic Review 82(2): 386–391.

Cann, R. L., Stoneking, M. and Wilson, A. C. (1987). Mitochondrial dna and human evolution, Nature 325(6099): 31–36.

Claessen, H. J. M. and Skalník, P. (1978). The Early state, Mouton, The Hague.

Conley, T. (1999). Gmm estimation with cross sectional dependence, Journal of Econometrics 92(1): 1–45.

Cook, C. J. (2015). The natural selection of infectious disease resistance and its effect on contemporary health, Review of Economics and Statistics 97(4): 742–757.

Cook, C. J. and Fletcher, J. M. (2016). Genetic diversity and economic outcomes: Evidence from high schools in wisconsin, Working Paper .

Creanza, N., Ruhlen, M., Pemberton, T. J., Rosenberg, N. A., Feldman, M. W. and Ramachandran, S. (2015). A comparison of worldwide phonemic and genetic variation in human populations, Proceedings of the National Academy of Sciences 112(5): 1265–1272.

Dean, J. S., Euler, R. C., Gumerman, G. J., Plog, F., Hevly, R. H. and Karlstrom, T. N. (1985). Human behavior, demography, and paleoenvironment on the colorado plateaus, American Antiquity pp. 537–554.

Depetris-Chauvin, E. (2014). State history and contemporary conflict: Evidence from sub-saharan africa, Technical report, Brown University.

Desmet, K., Ortuño-Ortín, I. and Wacziarg, R. (2012). The political economy of linguistic cleavages, Journal of development Economics 97(2): 322–338.

Desmet, K., Ortuño-Ortín, I. and Wacziarg, R. (2015). Culture, ethnicity and diversity, Technical report, National Bureau of Economic Research.

Diamond, J. M. (1997). Guns, germs, and steel: the fates of human societies, 1st ed, W.W. Norton & Co., New York.

Díaz del Castillo, B. (1796). Historia verdadera de la conquista de la Nueva España, Imprenta de Don Benito Cano, Madrid.

Dryer, Matthew S & Haspelmath, M. e. (2013). The World Atlas of of Language Structures Online., Leipzig: Max Planck Institute for Evolutionary Anthropology.

Durkheim, É. (1893). De la division du travail social, 2. éd, F. Alcan, Paris.

Easterly, W. and Levine, R. (1997). Africa’s growth tragedy: policies and ethnic divisions, The Quarterly Journal of Economics pp. 1203–1250.

Fenske, J. (2014). Ecology, trade, and states in pre-colonial africa, Journal of the European Economic Association 12(3): 612–640.

Freeman, D. and Pankhurst, A. (2003). Peripheral people: the excluded minorities of Ethiopia, Red Sea Press, Lawrenceville, NJ.

Friedlaender, J. S., Friedlaender, F. R., Reed, F. A., Kidd, K. K., Kidd, J. R., Chambers, G. K., Lea, R. A., Loo, J.-H., Koki, G., Hodgson, J. A. et al. (2008). The genetic structure of pacific islanders, PLoS Genet 4(1): e19.

Galor, O. and Özak, Ö. (2015). Land productivity and economic development: Caloric suitability vs. agricultural suitability, SMU Working Paper Series .

Galor, O. and Özak, Ö. (2016). The agricultural origins of time preference, American Economic Review 106(10).

Galor, O., Özak, Ö. and Sarid, A. (2016). Geographical origins and economic consequences of language structures, SMU Working Paper Series .

Gennaioli, N. and Rainer, I. (2007). The modern impact of precolonial centralization in africa, Journal of Economic Growth 12(3): 185–234.

Giuliano, P. and Nunn, N. (2013). The transmission of democracy: from the village to the nation-state, The American Economic Review 103(3): 86–92.

Gluckman, M. (1941). Economy of the central Barotse plain, Rhodes-Livingstone Institute, Livingstone.

Hallpike, C. R. (1968). The status of craftsmen among the konso of south-west ethiopia, Africa 38(03): 258–269.

Hallpike, C. R. (2008). The Konso of Ethiopia: a study of the values of a Cushitic people, AuthorHouse, Central Milton Keynes.

Hamilton, M. J. and Buchanan, B. (2009). The accumulation of stochastic copying errors causes drift in culturally transmitted technologies: quantifying clovis evolutionary dynamics, Journal of Anthropological Archaeology 28(1): 55–69.

Hausmann, R. and Hidalgo, C. A. (2011). The network structure of economic output, Journal of Economic Growth 16(4): 309–342.

Hausmann, R., Hidalgo, C. A., Bustos, S., Coscia, M., Simoes, A. and Yildirim, M. A. (2014). The atlas of economic complexity: Mapping paths to prosperity, Mit Press.

Henderson, J. V., Storeygard, A. and Weil, D. N. (2012). Measuring economic growth from outer space, The American Economic Review 102(2): 994–1028.

Hidalgo, C. A., Klinger, B., Barabási, A.-L. and Hausmann, R. (2007). The product space conditions the development of nations, Science 317(5837): 482–487.

Hill, K. and Hurtado, A. M. (1996). Aché life history: the ecology and demography of a foraging people, Aldine de Gruyter, New York.

Hinton, P. (1979). The karen, millennialism, and the politics of accommodation to lowland states, in C. F. Keyes (ed.), Ethnic Adaptation and Identity: The Karen on the Thai Frontier with Burma, Institute for the Study of Human Issues, pp. 81–98.

Houthakker, H. S. (1956). Economics and biology: specialization and speciation, Kyklos 9(2): 181–189.

Kimura, M. (1983). The neutral theory of molecular evolution, Cambridge University Press, Cambridge.

Kiszewski, A., Mellinger, A., Spielman, A., Malaney, P., Sachs, S. E. and Sachs, J. (2004). A global index representing the stability of malaria transmission, The American Journal of Tropical Medicine and Hygiene 70(5): 486–498.

Kiyotaki, N. and Wright, R. (1989). On money as a medium of exchange, The Journal of Political Economy pp. 927–954.

Lao, O., Lu, T. T., Nothnagel, M., Junge, O., Freitag-Wolf, S., Caliebe, A., Balascakova, M., Bertranpetit, J., Bindoff, L. A., Comas, D. et al. (2008). Correlation between genetic and geographic structure in europe, Current Biology 18(16): 1241–1248.

Lewbel, A. (2012). Using heteroscedasticity to identify and estimate mismeasured and endogenous regressor models, Journal of Business & Economic Statistics 30(1): 67–80.

Loomis, W. T. (1998). Wages, welfare costs, and inflation in classical Athens, The University of Michigan Press, Ann Arbor.

Lycett, S. J. (2008). Acheulean variation and selection: does handaxe symmetry fit neutral expectations?, Journal of Archaeological Science 35(9): 2640–2648.

Lycett, S. J. and von Cramon-Taubadel, N. (2008). Acheulean variability and hominin dispersals: a model-bound approach, Journal of Archaeological Science 35(3): 553–562.

Manica, A., Amos, W., Balloux, F. and Hanihara, T. (2007). The effect of ancient population bottle-necks on human phenotypic variation, Nature 448(7151): 346–348.

Michalopoulos, S. (2012). The origins of ethnolinguistic diversity, The American Economic Review 102(4): 1508.

Michalopoulos, S. and Papaioannou, E. (2013). Pre-colonial ethnic institutions and contemporary african development, Econometrica 81(1): 113–152.

Moore, J. L., Manne, L., Brooks, T., Burgess, N. D., Davies, R., Rahbek, C., Williams, P. and Balmford, A. (2002). The distribution of cultural and biological diversity in africa, Proceedings of the Royal Society of London B: Biological Sciences 269(1501): 1645–1653.

Murdock, G. P. (1967). Ethnographic atlas: a summary, Ethnology pp. 109–236.

Murdock, G. P. and White, D. R. (1969). Standard cross-cultural sample, Ethnology pp. 329–369.

Myres, N. M., Rootsi, S., Lin, A. A., Järve, M., King, R. J., Kutuev, I., Cabrera, V. M., Khusnutdinova, E. K., Pshenichnov, A., Yunusbayev, B. et al. (2011). A major y-chromosome haplogroup r1b holocene era founder effect in central and western europe, European Journal of Human Genetics 19(1): 95–101.

Nettle, D. (1998). Explaining global patterns of language diversity, Journal of anthropological archae- ology 17(4): 354–374.

Nissen, H. J., Damerow, P. and Englund, R. K. (1993). Archaic bookkeeping: early writing and tech- niques of economic administration in the ancient Near East, University of Chicago Press, Chicago, Ill.

Nolan, P. and Lenski, G. E. (2011). Human societies: an introduction to macrosociology, 11th ed edn, Paradigm Publishers, Boulder.

Nunn, N. and Puga, D. (2012). Ruggedness: The blessing of bad geography in africa, Review of Economics and Statistics 94(1): 20–36.

Nunn, N. and Wantchekon, L. (2011). The slave trade and the origins of mistrust in africa, American Economic Review 101(7): 3221–52.

Olson, D. M., Dinerstein, E., Wikramanayake, E. D., Burgess, N. D., Powell, G. V., Underwood, E. C., D’amico, J. A., Itoua, I., Strand, H. E., Morrison, J. C. et al. (2001). Terrestrial ecoregions of the world: A new map of life on earth a new global map of terrestrial ecoregions provides an innovative tool for conserving biodiversity, BioScience 51(11): 933–938.

Oster, E. (2014). Unobservable selection and coefficient stability: Theory and validation.

Özak, Ö. (2010). The voyage of homo-economicus: Some economic measures of distance.

Özak, Ö. (2012). Distance to the technological frontier and economic development, Southern Methodist University Working Paper Series .

Pemberton, T. J., DeGiorgio, M. and Rosenberg, N. A. (2013). Population structure in a comprehensive genomic data set on human microsatellite variation, G3: Genes| Genomes| Genetics 3(5): 891–907.

Perrin, M. (1996). Guajiro, The Gale Group, Inc.

Pinhasi, R., Thomas, M. G., Hofreiter, M., Currat, M. and Burger, J. (2012). The genetic history of europeans, Trends in Genetics 28(10): 496–505.

Prem, H. J. and Carrasco Pizana, P. (1974). Matrícula de Huexotzinco: ms. mex. 387 der Bibliothèque Nationale Paris : Edition, Kommentar, Hieroglyphenglossar, Akademische Druck- u. Verlagsanstalt, Graz, Austria.

Putterman, L. (2008). Agriculture, diffusion and development: ripple effects of the neolithic revolution, Economica 75(300): 729–748.

Ramachandran, S., Deshpande, O., Roseman, C. C., Rosenberg, N. A., Feldman, M. W. and Cavalli- Sforza, L. L. (2005). Support from the relationship of genetic and geographic distance in human populations for a serial founder effect originating in africa, Proceedings of the National Academy of Sciences of the United States of America 102(44): 15942–15947.

Reid, R. J. (2002). Political power in pre-colonial Buganda: economy, society & welfare in the nineteenth century, James Currey, Oxford.

Roberts, K. (2011). The origins of business, money, and markets, Columbia Business School Pub., New York.

Rogers, D. S., Feldman, M. W. and Ehrlich, P. R. (2009). Inferring population histories using cultural data, Proceedings of the Royal Society of London B: Biological Sciences 276(1674): 3835–3843.

Schmandt-Besserat, D. and Schmandt-Besserat, D. (1996). How writing came about, 1st abridged ed edn, University of Texas Press, Austin.

Smith, A. (1776). An Inquiry into the Nature and Causes of the Wealth of Nations, Whitestone, Dublin.

Spolaore, E. and Wacziarg, R. (2013). How deep are the roots of economic development?, Journal of Economic Literature 51(2): 325–69.

Stigler, G. J. (1951). The division of labor is limited by the extent of the market, The Journal of Political Economy pp. 185–193.

Sun, G.-Z. (2012). The division of labour in economics: a history, Vol. 142 of Routledge studies in the history of economics, Routledge, London.

Trigger, B. G. (1983). The rise of egyptian civilization, in B. G. Trigger, B. J. Kemp, D. O’Connor and A. B. Lloyd (eds), Ancient Egypt: a social history, Cambridge University Press Cambridge, pp. 1–70.

Wang, S., Lewis Jr, C. M., Jakobsson, M., Ramachandran, S., Ray, N., Bedoya, G., Rojas, W., Parra, M. V., Molina, J. A., Gallo, C. et al. (2007). Genetic variation and population structure in native americans, PLoS Genet 3(11): e185.

Yang, X. and Borland, J. (1991). A microeconomic mechanism for economic growth, Journal of political economy pp. 460–482.

Yang, X. and Sachs, J. D. (2008). Economic development and the division of labor, John Wiley & Sons.