Endogenous Borders? Exploring a Natural Experiment on Border Effects

Konferenzbeitrag

A large literature documents the impact of borders on trade. However, in all these studies border effects are identified from cross-sectional variation alone. We do not know the "treatment effect" of borders nor can we rule out reverse causation. In this paper we exploit the border changes imposed across Europe by the peace treaties in 1919-20 as a natural experiment. We estimate the effects of borders on trade with a difference in difference approach and find that the "treatment effects" of borders are much smaller than the pure cross-sectional effects. We find strong evidence that border changes occurred systematically along pre-existing trade frictions.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: History as Laboratory: Natural Experiments in Economic History ; No. E1-V3

Classification and Topics

• Classification: Wirtschaft ; Economic Integration ; Economic History: Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations: Europe: Pre-1913 ; Economic History: Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations: Europe: 1913-
• Subject: border effects ; treatment effects ; European history

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Wolf, Nikolaus ; Heinemeyer, Hans Christian ; Schulze, Max-Stephan
• Event: Veröffentlichung
• (who): Verein für Socialpolitik
• (where): Frankfurt a. M.
• (when): 2010

Further information

• Handle: http://hdl.handle.net/10419/37300
• Last update: 10.03.2025, 11:42 AM CET