Fickle Fossils. Economic Growth, Coal and the European Oil Invasion, 1900-2015

Miriam Fritzsche and Nikolaus Wolf

No 3, Berlin School of Economics Discussion Papers from Berlin School of Economics

Abstract: Fossil fuels have shaped the European economy since the industrial revolution. In this paper, we analyse the effect of coal and oil on long-run economic growth, exploiting variation at the level of European NUTS-2 and NUTS-3 regions over the last century. We show that an “oil invasion” in the early 1960s turned regional coal abundance from a blessing into a curse, using new detailed data on carboniferous strata as an instrument. Moreover, we show that human capital accumulation was the key mechanism behind this reversal of fortune. Not only did former coal regions fail to accumulate sufficient levels of human capital, but pre-industrial human capital helped declining regions to reinvent themselves. Without sufficient human capital, fossil fuels did never generate sustainable growth.

Keywords: Coal; Oil Invasion; Education; Reinvention; Economic Growth (search for similar items in EconPapers)
JEL-codes: I25 N13 O13 Q32 R10 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2022-11-29
New Economics Papers: this item is included in nep-ene, nep-env, nep-gro and nep-his
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Related works:
Working Paper: Fickle Fossils. Economic Growth, Coal and the European Oil Invasion, 1900-2015 (2023)
Working Paper: Fickle Fossils. Economic Growth, Coal and the European Oil Invasion, 1900-2015 (2023)
Working Paper: Fickle Fossils. Economic Growth, Coal and the European Oil Invasion, 1900-2015 (2023)
Working Paper: Fickle Fossils. Economic Growth, Coal and the European Oil Invasion 1900-2015 (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:bdp:dpaper:0003

DOI: 10.48462/opus4-4652

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