American Economic Review: Vol. 103 No. 3 (May 2013)


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Social Organizations, Violence, and Modern Growth

Article Citation

Greif, Avner, and Murat Iyigun. 2013. "Social Organizations, Violence, and Modern Growth." American Economic Review, 103(3): 534-38.

DOI: 10.1257/aer.103.3.534


Social institutions were often founded by the elite to avoid social upheavals. Institutions helped mitigate the threat of violent social responses to labor-saving innovations. But their organizational forms were influenced by preexisting cultural and social factors. The differences in Chinese and English social institutions explain why England became the first modern economy. Using an English panel of poor relief and social unrest from 1650 to 1830, we document that poor relief was statistically significant in reducing social disorder. Social instability, in turn, negatively influenced innovations, while innovations were positively and significantly related to poor relief.

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Greif, Avner (Stanford U)
Iyigun, Murat (U CO)

JEL Classifications

D02: Institutions: Design, Formation, and Operations
D23: Organizational Behavior; Transaction Costs; Property Rights
D74: Conflict; Conflict Resolution; Alliances
E23: Macroeconomics: Production
O43: Institutions and Growth

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