Land use and development over the long run

Abstract

This thesis comprises three essays on the role of land use in economic development over the long run. As is natural for many theses, "development" here is defined in a range of ways. The first essay considers the long-run effects of historical land concentration on agricultural investment and productivity in the frontier United States. The second essay considers how disruptions to agriculture in the US South, in the form of the boll weevil pest, changed the political economy of the Jim Crow South. The final essay considers the long run in the future, using agronomic microdata to assess the impact of climate change on agricultural productivity. The first chapter provides new evidence on the old question of how concentrating land into the hands of large landlords affects economic development. Despite their popularization as bastions of pioneer equality, America's frontier regions often exhibited highly concentrated patterns of land ownership.

A patchwork of policies opened some areas to large-scale farming by absentee landlords but reserved others for settlement by small farmers. This paper studies the impacts of land concentration on the long-run development of the frontier United States using quasi-random variation in these allocation procedures. I collect a large database of modern property tax valuations and show that historical land concentration had persistent effects over a span of 150 years: lowering investment by 23%, overall property value by 4.4%, and population by 8%. I argue that landlords' use of sharecropping raised the costs of investment, a static inefficiency that persisted due to land market frictions. I find little evidence for other explanations, including elite capture of political systems.

I use my empirical estimates to evaluate counterfactual policies, applying recent advances in combinatorial optimization to show that an optimal property rights allocation would have increased my sample's agricultural land values by $28 billion (4.8%) in 2017. The second chapter, joint with James Feigenbaum and Soumyajit Mazumder, studies the role of Hirschman's threat of "exit" in the Great Migration in the Jim Crow South. How do coercive societies respond to negative economic shocks? Since before the nation's founding, cotton cultivation formed the politics and institutions in the South, including the development of slavery, the lack of democratic institutions, and intergroup relations between whites and blacks. We leverage the natural experiment generated by the boll weevil infestation from 1892-1922, which disrupted cotton production in the region.

Panel difference-in-differences results provide evidence that Southern society became less violent and repressive in response to this shock with fewer lynchings and less Confederate monument construction. Cross-sectional results leveraging spatial variation in the infestation and historical cotton specialization show that affected counties had less KKK activity, higher non-white voter registration, and were less likely to experience contentious politics in the form of protests during the 1960s. To assess mechanisms, we show that the reductions in coercion were responses to African American out-migration. Even in a context of antidemocratic institutions, ordinary people can retain political power through the ability to "vote with their feet." The third chapter, joint with Arnaud Costinot and Dave Donaldson, looks at the long run effects of climate change on agricultural productivity and land use.

A large agronomic literature models the implications of climate change for a variety of crops and locations around the world. The goal of the present paper is to quantify the macro-level consequences of these micro-level shocks. Using an extremely rich micro-level dataset that contains information about the productivity--both before and after climate change--of each of 10 crops for each of 1.7 million fields covering the surface of the Earth, we find that the impact of climate change on these agricultural markets would amount to a 0.26% reduction in global GDP when trade and production patterns are allowed to adjust.