 Cultural barriers to market integration: Evidence from 19th century AustriaJournal of Comparative Economics, 2018, vol. 46, issue 4, 1122-1145 Abstract: I explore the relationship between culture and market integration using data from 19th century Austria and find that religious, not ethnic, differences between regions increase price differentials for grains. I argue that an important mechanism is cultural patronage in the placement of transportation infrastructure. The results show that railroad construction was more intensive between religiously similar places and that religious diversity within regions is negatively correlated with road and rail density. As a secondary mechanism, I argue that regions with more religious diversity enjoyed greater competition in agricultural markets after the elimination of religious discrimination in land tenure institutions. The results support this hypothesis, showing that within regions, religious diversity is negatively correlated with grain prices. The findings highlight the importance of culture and institutions in economic development and are relevant for culturally diverse regional economies today. Keywords: Market integration; Culture; Institutions; Railroads; Habsburg (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:46:y:2018:i:4:p:1122-1145 DOI: 10.1016/j.jce.2018.05.001 Access Statistics for this article Journal of Comparative Economics is currently edited by D. Berkowitz and G. Roland More articles in Journal of Comparative Economics from Elsevier |
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