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Abstract for:

Self-Reinforcing Shocks: Evidence from a Resettlement Policy

Aki  Kangasharju,  Matti  Sarvimäki,  April 2010
Paper No' SERCDP0047: | Full paper (pdf)
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Keywords: Economic geography; agglomeration, migration

JEL Classification: F12; J10; R12; N94

Is hard copy/paper copy available? YES - Paper Copy Still In Print.
This Paper is published under the following series: SERC Discussion Papers
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Abstract:

i. A completely revised version of this paper is available as SERCDP0080, May 2011.

We examine the long-term effects of resettling 11 percent of the Finnish population from areas ceded to the Soviet Union during World War II. Our empirical strategy exploits features of the resettlement policy as a source of plausibly exogenous variation in population growth. The results suggest that a 10 percent increase in the population of a rural location during the war caused an additional 15 percent growth during the next five decades. The growth was driven by migration and led to the expansion of the non-primary sector. The effect is larger for locations connected to the railway network.