The economic power of elites, human capital, and industrial change in late Imperial Russia

Abstract

This paper studies the economic impacts of land ownership concentration among the aristocratic elite in the Russian Empire. I document that areas with a higher concentration of noble land ownership were associated with lower levels of primary education during 1880–1911. Exploring the mechanisms, I show that by controlling local governments the landed elites decreased public spending on education, shifting the financial burden to peasant households in the 1880s–1890s. I also demonstrate that the extension of school provision through a government program of schooling subsidies after 1905 led to a relatively large increase in enrollment rates in regions with high noble landownership concentration, suggesting initial underinvestment in education in these areas. Finally, the paper identifies a significant negative influence of landed elites on industrial growth and firm productivity, with up to 56% of this effect attributable to the human capital channel.