Title

The Distributional Consequences of Trade: Evidence from the Grain Invasion

Author(s)

Stephan Heblich Stephan Heblich (University of Toronto and NBER)

Stephen J. Redding Stephen Redding (Princeton University, NBER and CEPR)

Yanos Zylberberg Yanos Zylberberg (University of Bristol and CEPR)

Abstract

We examine the distributional consequences of trade using the New World Grain Invasion that occurred in the second half of the 19th century. We use a newly-created dataset on population, employment by sector, property values, and poor law transfers for over 10,000 parishes in England and Wales from 1801–1901. In response to this trade shock, we show that locations with high wheat suitability experience population decline, rural-urban migration, structural transformation away from agriculture, increases in welfare transfers, and declines in property values, relative to locations with low wheat suitability. We develop a quantitative spatial model to evaluate the income distributional consequences of this trade shock. Undertaking counterfactuals for the Grain Invasion, we show that geography is an important dimension along which these income distributional consequences occur.

Creation Date

2024-09

Section URL ID

Paper Number

337

URL

https://gceps.princeton.edu/wp-content/uploads/2024/09/wp337_Redding_Trade-Grain-Invasion.pdf

File Function

Jel

F14, F16, F66

Keyword(s)

United Kingdom; international trade, income distribution, geography

Suppress

false

Series

3