Nikolaus Wolf (Humbolt University)

joint with F. Kersting and I. Wohnsiedler

We revisit the evidence for Max Weber's hypothesis on the role of Protestantism for economic development in 19th century Germany. We show that income levels, literacy rates and savings within Germany are much more affected by differences between nationalities than by differences between religious groups, exploiting rich variation in terms of religious denominations and mother tongue and using religious denominations in 1624 as instrument. Especially differences in savings rates, which stand at the core of Weber's argument, are due to differences in nationality. The effect of nationality on various outcomes can be partly explained by discrimination against the Polish minority and successful Polish resistance against this.