The legacy of autocratic rule in China

What is the long-term legacy of political persecutions? Here I want to present the main findings of my recent research with Melanie Meng Xue (UCLA Anderson). Our research is an attempt to undercover how a legacy of political persecution can shape social capital and civil society by studying imperial China. The full version of the paper is available here.

We know from other research that particular institutions, policies, and events can have a detrimental and long-lasting impact on economic and political outcomes (e.g. Nunn 2011, Voigtländer and Voth, 2012). But it is hard to find a setting where we can study the long-run impact of autocratic institutions. A key feature of autocracy is the use of persecutions to intimidate potential opponents. In our paper, Melanie and I argue that the intensification of imperial autocracy that took place in the High Qing period (1680-1794) provides an ideal setting to study the impact of such persecutions.

Qing China

The High Qing period was one of great political stability, imperial expansion, and internal peace. Economic historians like Bin Wong and Ken Pomeranz have shown that China possessed a flourishing market economy during this period; it experienced Smithian economic growth and a massive demographic expansion. Rulers such as the Kangxi (1661-1722) and Qianlong Emperors (1735-1794) are seen as among the most successful in Chinese history. Nevertheless, as ethnic Manchus, these rulers were extremely sensitive to possible opposition from the Han Chinese. And during this period Qing tightened control over the gentry and implemented a policy of the systematic persecution of dissent. (Figure 1 depicts the Manchu conquest of China.)

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The Qing conquest of China

The Literary Inquisitions

The focus of our paper is on the impact of persecutions conducted by Qing China against individuals suspected of expressing disloyalty. We study the impact of these state-orchestrated persecutions on the social fabric of society. This allows us to speak to the kinds of concerns that authors like Hannah Arendt and George Orwell expressed about the long-run impact of totalitarianism in the 20th century.

These persecutions are referred to by historians as ‘literary inquisitions’. Existing scholarship suggests that the resulting fear of persecution elevated the risks facing writers and scholars, and created an atmosphere of oppression and a culture of distrust which deterred intellectuals from playing an active role in society. But these claims have never been systematically investigated. Putting together several unique datasets for historical and modern China, we explore the impact of literary inquisitions on social capital in Qing China and trace its long-run impact on modern China through its effect on cultural values.

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Jonathan Spence provides an excellent account of one of the most famous and unusual inquisition cases in his book Treason by the Book

To conduct our analysis, we use data on 88 inquisition cases. We match the victims of each case (there are often multiple victims per case) to their home prefecture. This data is depicted in Figure 1. Since prefectures varied greatly in their economic, social, and political characteristics we conduct our analysis on a matched sample. This ensures that the prefectures “treated” by a literary inquisition are similar in terms of their observables to those we code as “untreated”. As our data is a panel, we are able to exploit variation across time as well as variation in space.

While individuals could be persecuted for a host of reasons, these were all but impossible to anticipate ex ante. Cases were referred to the emperor himself. Frederic Wakeman called this “the institutionalization of Imperial subjectivity.” The standard punishment in such cases was death by Lingchi or (slow slicing) and the enslavement of all one’s immediate relatives. In some cases, however, the guilty party would be executed by beheading. These persecutions aimed to deter opposition to Qing rule by signaling the ability of the Emperor to hunt down all potential critics or opponents of the regime.

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The Impact of Literary Inquisitions on Social Capital

We initially focus on the impact of persecution on the short and medium-run using our historical panel. We first examine the effects on the number of notable scholars.  In our preferred specification we find that a literary inquisition reduced the number of notable scholars in a prefecture by 33 percent relative to the sample mean.

We go on to show the effect of persecutions on collective participation among the gentry in China. Our measure of collective participation in civil society is the number of charitable organizations. Charitable organizations played an important role in premodern China providing disaster relief and local public goods such as repairing local roads. They were non-governmental organizations and played an important role alongside the government provision of disaster relief. In our preferred empirical specification, we find that a persecution number of charitable organizations by 38 percent relative to the sample mean.

These results are in keeping with the argument that literary inquisition had a major psychological impact on Chinese society. They are consistent with the rise of “inoffensive” literary subjects during the Qing period that have documented by historians. To reduce the risk of persecution, intellectuals scrupulously avoided activities that could be interpreted as constituting an undermining of Qing rule. Instead they “immersed themselves in the non-subversive “sound learning” and engaged in textual criticism, bibliography, epigraphy, and other innocuous, purely scholarly pursuits” (Wiens, 1969, 16).

The Impact of Literary Inquisitions on 20th Century Outcomes

We go on to examine how the effects of these persecutions can be traced into the 20th century. In particular, we focus on the provision of basic education at the end of Qing dynasty. In late 19th and early 20th century China, there was no centralized governmental provision of primary schools.  Basic education remained the responsibility of the local gentry who ran local schools.

Thus the provision of education at a local level was dependent on the ability of educated individuals to coordinate in the mobilization of resources; this required both cooperation and trust. We therefore hypothesize that if the persecution of intellectuals had a detrimental impact on social capital, it should also have negatively affected the provision of basic education.

We find that among individuals aged over 70 in the 1982 census – hence individuals who were born in the late Qing period – a legacy of a literary inquisition is associated with lower levels of literacy. This reflects the impact of literary inquisition on the voluntary schools provided by the gentry and is not associated with lower enrollment at middle school or high school. We show that result is robust to controlling for selective migration and for the number of death caused by the Cultural Revolution.

Finally, we show that literary inquisitions generated a cultural of political non-participation. Drawing on two datasets of political attitudes – the Chinese General Social Survey (CGSS) and the Chinese Political Compass (CPoC) – we show that individuals in areas in which individuals were targeted during literary inquisitions are both less trusting of government and less interested in political participation.

Finally, we find that individuals in prefectures with a legacy of literary inquisitions are less likely to agree that: “Western-style multi-party systems are not suitable for China” (Q 43.). This suggests that in areas affected by literary inquisitions individuals are also more skeptical of the claims of the Chinese government and more open to considering alternative political systems. Similarly, individuals in affected prefectures are more likely to disagree with the statement that: “Modern China needs to be guided by wisdom of Confucius/Confucian thinking.”

In summary, our analysis suggests that autocratic rule reduced social capital and helped to produce a culture of political quietism in pre-modern China. This has left a legacy that persisted into the 20th century. These findings have implications for China’s current political trajectory. Some scholars anticipate China undergoing a democratic transition as it’s economy develops (Acemoglu and Robinson, 2012). Others point to China as an example of “authoritarian resilience.” By showing that a long-history of autocratic rule and political persecutions can produce a culture of political apathy, our results shed light on a further and previously under-explored source of authoritarian resilience.

Minorities and Economic Growth: Evidence from Jewish Communities in Premodern Europe

Urban theorist Richard Florida is celebrated for arguing that cities today succeed by attracting members of the “creative class.”  In a similar spirit I have a recent paper with Noel D. Johnson where we investigated whether or not cities in medieval and early modern Europe grew faster if they possessed a Jewish community.

Scholars have long noted the role of minority groups in economic development. This is particularly true for the the premodern period. The great scholar of long-run historical development in Europe, Fernand Braudel, observed that “successful merchants who controlled trade circuits and networks often belonged to foreign minorities.” These minorities could be other nationalities or religious minorities, for example, “the Jews, the Armenians, the Banyans, the Parsees, the Raskolniki (Old Believers) in Russia or the Christian Copts in Muslim Egypt” (Braudel, 1979, 1982, 165).

Hornung (2014) studies the impact of the Huguenot migration to Prussia. Since the nineteenth century, scholars like Friedrich List linked the presence of Huguenots with the transmission of human capital, skills, and innovation. Hornung (2014) is able to test this hypothesis using Prussian immigration lists from 1700 that document the location of Huguenot settlements and firm-level data on input and output for all 750 textile manufactories in Prussia in the year 1802. Approximately 16,000 to 20,000 Huguenots fled France to Prussia at the end of the seventeenth century.  Hornung finds that the presence of Huguenots significantly increased firm productivity. Specifically, a 1 percentage point increase in the share of Huguenots was associated with 1.5 percentage points higher productivity in 1802.

Jewish Communities and City Growth

In our paper we take a broad sweep of European history from 1400 to 1850.  We have a total of 1,792 cities in our panel data from the Bairoch (1988) dataset and 1,069 Jewish communities that appear in the Encyclopedia Judaica. The figure below shows both the cities in the Bairoch dataset and the Jewish communities mentioned in the Encyclopedia Judaica.

 

bairochandjewishcitiesgreyscale

To understand the relationship between the presence of a Jewish community and subsequent city growth we conduct a difference-in-differences style regression analysis.

The fact that we have data on city populations every century means we can hold constant the identity of a city using city fixed effects and see whether or not it grew faster in the centuries when it had a Jewish community in comparison to those centuries when it did not. We can also control for the possibility that overall city growth was faster in some centuries in comparison to others using century fixed effects.

We are also able to hold constant other factors that could plausibly have affected city growth. We control for local geography including cereal suitability, proximity to rivers, and proximity to coast, as these factors likely affected city growth in different ways over time. We also control for local infrastructure including presence of university and distance to a medieval trade route.

Our  analysis suggests that, indeed, cities with Jewish communities grew faster on average between 1400 and 1850. The effect we find suggests that cities with Jewish communities grew about one third faster than those that did not have Jewish communities. This analysis remains a correlation, however. We do not know if the presence of a Jewish community brought with it economic benefits or if Jews merely choose to settle in faster growing cities.

Instrumenting the Presence of a Jewish Community

We model the network of Jewish communities as one way to see whether the effect of Jews on city growth was indeed casual. By examining how Jewish communities expanded we hope to isolate a source of exogenous variation in the presence of a Jewish community.

We assume that a Jewish community is more likely to be established close to another Jewish community because of trade networks, financial relationships, or cultural linkages. We then calculate the closest travel path between Jewish communities using our information about the location of roads and river networks and estimates of premodern transport costs. The important assumption we make is that if cities with Jewish communities share certain “unobservable” characteristics that might make them more likely to grow rapidly, these characteristics become less correlated with distance.

We then divide Europe into 5km x 5km grids and assign the lowest travel cost to each grid. We apply Djikstra’s algorithm to determine the lowest cost of travel between all 3,211,264 city pairs (van Etten, 2012). This allows us to create a measure of ‘Jewish network access’ for each city.

Jewish network access itself is, of course, correlated with the unobservable characteristics of the city for which it is calculated. To overcome this we adopt two strategies to create valid instruments out of the network access measures. First, we calculate Jewish network access for cities that are only more than a certain distance away from each other. Second, we use information on expulsions to weight our measure of Jewish network access. The intuition behind this is that Jewish expulsions consist of an exogenous “push” factor leading to Jews settling in new cities close to the existing network of Jewish communities. Using these two strategies we obtain similar (though larger in magnitude) effects from the presence of a Jewish community on city growth. This provides further suggestive evidence that the correlation we found in our baseline analysis was indeed causal.

The Relationship Between Urban Growth and the Presence of a Jewish Community Over time

Across specifications, we find that cities with Jewish communities experienced no growth advantage in the 15th and 16th centuries. After 1600, however, they began to grow significantly faster.

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The relationship we observe in the Figure does not appear to be inline with a pure human capital story. Jews had higher human capital than Christians throughout the medieval and early modern period. But the growth advantage of cities that had Jewish communities only became evident after 1600. This raises the possibility that something else changed around  17th century that made the human capital and skills of Jews more complementary to economic growth.

Two Mechanisms: Jewish Emancipation and Market Access

The two factors that stand out in explaining the emergence of a growth advantage for cities with Jewish communities after 1600 but not before are: (1) Jewish Emancipation after 1750; and (2) a complementarity between the presence of a Jewish community and market access.

The process of Jewish emancipation began in continental Europe after 1780. It was a major institutional break that signified a major change in the economic, social, and political status of the Jews in Europe. In work with Jean-Paul Carvalho, I’ve shown that Jewish emancipation lead to a religious schism and the emergence of both Reform and Ultra-Orthodox Judaism.

In the period before Jewish emancipation, legal barriers limited the ability of Jews to put their labor to its highest value use. Jewish businesses were prevented from hiring non-Jewish workers. Jews could not attend universities. Moreover, Jews and Christians were culturally isolated. This changed with emancipation, and we expect to see it reflected in the contribution of Jewish communities to city growth in the post-1750 period.

The second factor we study is the complementarity between the presence of a Jewish community and the development of markets. The historical literature points to the importance of Jewish trading and financial networks. But, while economic historians have conducted numerous studies of market integration during the early modern period, with a few exceptions these have focused on the grain trade with little systematic study of other markets due to data limitations. Jewish merchants in medieval and early modern Europe, however, did not play a prominent role in the grain trade but, rather, were involved in the transport of diamonds, sugar, silks, tobacco, and other luxury products in addition to playing a large role in banking and finance. Therefore, rather than looking at grain markets, we explore a more general measure of market integration based on market access.

Market access depends on the population size of nearby cities weighted by the cost associated with the least cost travel path. We show that market access was increasing for all cities after 1700. We find evidence that cities with Jewish communities were better able to take advantage of this increase in market access. As we detail in the paper, our findings are consistent with the argument made by numerous historians that Jewish trading and finance networks help to knit together the European economy, particularly in the period 1650 to 1800 (Israel, 1985).

 

Our analysis provides support for the accounts of historians who have emphasized the important role played by Jewish traders in 17th and 18th century Europe (such as Fortune, 1984; Israel, 1985; Trivellato, 2009). Furthermore, our story is in line with institutional arguments such as those developed by Douglass North, John Wallis and Barry Weingast, and Daron Acemoglu and James Robinson.  In the Middle Ages, the presence of Jewish communities was part of an institutional arrangement that extracted rents from society and distributed them among members of the ruling elite. The eradication of these rent-seeking arrangements and the liberalization of Jewish economic activity, first in the Netherlands and England and then in the rest of Europe following Jewish Emancipation, was of critical importance as it is in those cities that possessed emancipated Jewish communities that we observe the strongest relationship between the presence of Jews and economic growth.