Wednesday, 29 May, 2024 | 13:00 | Brown Bag Seminar | ONLINE

Vladimir Shchukin: "Political Economy of Industrialization"

Let us invite you to a Brown Bag Seminar by Vladimir Shchukin
on May 29th, 2024, at 13:00 in room 402

You can also join the seminar online:
Passcode: 6119

Presenter: Vladimir Shchukin

Title: "Political Economy of Industrialization"

Industrialization was essential for the transition from Malthusian stagnation to a modern growth regime. However, initially, the landowning political elite did not promote industrial development, they in fact restrained it in order to maintain their political power and high land rent. In contrast, in the second half of the 19th century, in some economies the landowning elite encouraged industrialization. In this paper, we propose a theory that explains this change in the landowning elite’s behavior. We argue that the landowning elite industrialized the economy to prevent the formation of a coalition between workers and capitalists against the existing political regime. Specifically, the promotion of industrialization eliminated capital gains from political change and simultaneously increased expected losses from redistribution for capitalists if the political regime were to change. Ultimately, capitalists preferred to preserve the existing political regime and the landowning elite became more entrenched in political power. In addition, our theoretical framework reveals how landowners could guarantee future pro-industrial economic institutions without sharing political power.