Banks and Development: Jewish Communities in the Italian Renaissance and Current Economic Performance

By L. Pascali. Review of Economics and Statistics, 2016

111 citations recorded by the source corpus.

Abstract Are differences in local banking development long lasting? Do they affect economic performance? I answer these questions by relying on a historical development that occurred in Italian cities during the Renaissance. A change in Catholic doctrine led to the development of modern banks in cities hosting Jewish communities. Using Jewish demography in 1500 as an instrument, I provide evidence of extraordinary persistence in the level of banking development across Italian cities and substantial effects of local banks on per capita income. Additional firm-level analyses suggest that banks exert large effects on aggregate productivity by reallocating resources toward more efficient firms.

Subfields: Accounting, Demography, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/23f0aaf724cfd0ee32dc407fa4176a7946822873

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Citations in the corpus

History, Path Dependence and Development: Evidence from Colonial Railroads, Settlers and Cities in Kenya (2017, unknown): “We gratefully acknowledge the support of the Institute for International Economic Policy and the Elliott School of International Affairs at GWU.”
Consequences of forced migration: A survey of recent findings (2019, background): “Pascali (2016) provides evidence that Italian municipalities that expelled their Jewish population in the 15 and 16 century have a less developed banking system and lower incomes today. A recent paper by Testa (2018) uses the expulsion of 3 million Germans from the Czechoslovak borderlands after Wor”