Culture of Social Integration: How Extractive Colonialism Promotes Contemporary Individual Income

ABSTRACT

By exploring the history of northeastern China in 1898–1911, this paper documents that extractive colonialism spurs a culture of social integration that generates a positive effect on contemporary individual income, with robustness to potential endogeneity bias. Given that the existing literature has emphasized the long-run negative economic impacts of extractive colonialism, this paper helps explain the following institutional puzzle: Why does extractive colonialism spur development in the long run? We thereby deepen understanding of colonialism and institutions from a cultural perspective.

KEYWORDS:

• Extractive colonialism
• long-run development
• culture of social integration

JEL CODES:

• A10
• N00
• O10

JEL CLASSIFICATION:

• B25
• D31
• O15

Disclosure statement

No potential conflict of interest was reported by the author(s).

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

Notes

¹ To the best of our knowledge, there are no data to measure salience of extractive institutions. Even when some possible dataset are used, such as the extracted amount/value of minerals, which are negatively depends on the local capacity of the Chinese government, it tends to bring confounding factors for our estimations. We admit that our measure of extractive colonialism with only reference to the geographic location scarifies the measurement preciseness, but it tends to capture the exogenous part of extractive colonialism to guarantee the validity of our estimates, which is the fundamental requirement for identification.

² We measure not only the objective facts of social integration (i.e. ethnic diversity and dialect diversity) but also the subjective attitude to social integration (i.e. the propensity to accept migrants and migrant’s intention to remain). As such, we can infer that CSI rather than social integration matters.

³ We use historical documents on mining areas to identify the longitude and latitude of the core mining areas.

⁴ If we cluster standard errors at the prefecture level, we obtain the same findings. Since the number of clusters (at the prefecture level) is small, we report the results with robust standard errors.

⁵ The 2005 census indicates the ethnicity of the respondent, so we can measure the proportion at the prefecture level.

⁶ Considering that individuals beyond legal age may own income, we include individuals of all age and then re-conduct regressions. Correspondingly, results are highly similar to Table 1, which are provided upon request.

Additional information

Funding

This work was supported by the National Natural Science Foundation of China [Project No. 71763009].