Colonial Institutions, Trade Shocks, and the Diffusion of Elementary Education in Brazil, 1889-1930

Aldo Musacchio, André Martínez Fritscher and Martina Viarengo

No 10-075, Harvard Business School Working Papers from Harvard Business School

Abstract: In this paper, we examine the role of trade shocks in promoting the diffusion of elementary education in subnational units in Brazil during a period (1889-1930) in which they had relative financial autonomy to collect export taxes and spend on public goods. The argument is that trade shocks affect asymetrically the tax revenues of state governments and, thus, their expenditures on elementary education per capita according to what crop mix they had. We then show that states with more egalitarian and democratic institutions use positive trade shocks to invest in education, while the opposite takes place in states with less democratic institutions (e.g., in states that had more slaves). We also show using OLS and instrumental variables that positive trade shocks increased expenditures on education per capita and led to higher literacy rates and to more schools per children. The resulting distribution of human capital across states persists until today.

Pages: 43 pages
Date: 2010-03, Revised 2012-12
New Economics Papers: this item is included in nep-dev and nep-pol
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Citations: View citations in EconPapers (7)

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http://www.hbs.edu/faculty/pages/download.aspx?name=10-075.pdf Revised version, 2012 (application/pdf)

Related works:
Journal Article: Colonial Institutions, Trade Shocks, and the Diffusion of Elementary Education in Brazil, 1889–1930 (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hbs:wpaper:10-075

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