Social Institutions, Violence, and Innovations: Did the Old Poor Law Matter?

Social institutions impact growth by redistributing resources to the young, the poor, the old, and the sick. This paper empirically substantiates that England’s premodern social institutions–specifically, the Old Poor Law (1601-1834)–contributed to her transition to the modern economy. It reduced violent, innovation-inhibiting reactions from the economic agents threatened by economic change. This conclusion is based on an analysis of a panel of poor relief and social unrest data from 39 English counties over the period between 1650 and 1830. Variations in the amount of poor relief came to bear negatively and statistically significantly on the incidence of food riots. Moreover, food riots came to bear negatively on innovations, while the latter were positively and significantly related to poor relief prior to and during the First Industrial Revolution. The analysis complements the finding that England’s and China’s distinct social institutions influenced their trajectories of technological changes and social disorder (Greif, Iyigun, and Sasson, 2011, 2012). Social institutions have had multiple and changing roles in economic growth, while inter-societal cultural distinctions and intra-societal cultural dynamics have led to distinct social and cultural institutions. ∗Greif: Stanford University. Iyigun: University of Colorado. Corresponding author: [email protected]. This paper benefitted from comments by Ran Abramitzky, Paul David, Gavin Wright and participants in seminars at Stanford, Berkeley, University of Colorado, Universidad Torcuato di Tella, and the 2011 IEA Meetings in Beijing. Avner Greif thanks the Canadian Institute for Advanced Research (CIFAR) for support.