The Distributional Consequences of Trade: Evidence from the Grain Invasion

Stephan Heblich, Stephen Redding and Yanos Zylberberg

No 32958, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We provide new evidence on the income distributional consequences of trade using the New World Grain Invasion in the 19th Century and variation in agroclimatic suitability for wheat across locations within England and Wales. We show that this large-scale agricultural trade shock led to structural transformation away from agriculture and a redistribution of population from rural to urban areas. We develop a quantitative spatial model to rationalize our empirical findings and evaluate the aggregate implications of this international trade shock. We use our model to undertake counterfactuals for the Grain invasion, holding constant other exogenous determinants of economic activity. We find modest aggregate welfare gains combined with much larger income distributional effects, with geography an important dimension along which these income distributional effects occur.

JEL-codes: F14 F16 F66 (search for similar items in EconPapers)
Date: 2024-09
New Economics Papers: this item is included in nep-geo, nep-his, nep-int, nep-ipr and nep-ure
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Working Paper: The distributional consequences of trade: Evidence from the Grain Invasion (2024)
Working Paper: The distributional consequences of trade: evidence from the Grain Invasion (2024)
Working Paper: The Distributional Consequences of Trade: Evidence from the Grain Invasion (2024)
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