Evolution and Long-run Consequences of Agricultural Inheritance Traditions

Abstract: What are the origins and consequences of different inheritance traditions of agricultural property? Our analysis is based on a municipal-level data set on agricultural inheritance practices in Baden-Württemberg in the early 1950s. We also theoretically model how equal partition, because it induced more part-time farming and created less migration pressure lead to industrialisation and structural change in rural areas. In a first step of our empirical analysis, we investigate the factors that determined the origin, persistence and change of different inheritance practices. We find that especially geographic factors like elevation or wine-growing but also deep historical factors like being in the Germanic settlement area or having access to Roman roads are important to understand the origins of inheritance practices. For the persistence of those, deep-rooted historical factors seem to be most important. We also find that inheritance traditions change due to economic incentives and cultural diffusion. Second, we employ a spatial RDD to empirically test whether this is true. Confirming our theory, we find equal partition areas to be better developed, and more industrialized in 1950 and still in the 2000s.