DP15209 The Fractured-Land Hypothesis

Author(s): Jesús Fernández-Villaverde, Mark Koyama, Youhong Lin, Tuan-Hwee Sng
Publication Date: August 2020
Date Revised: September 2020
Keyword(s): China, Europe, Great Divergence, Political Centralization, Political Fragmentation, state capacity
JEL(s): H56, N40, P48
Programme Areas: Monetary Economics and Fluctuations
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=15209

Patterns of political unification and fragmentation have crucial implications for comparative economic development. Diamond (1997) famously argued that ``fractured land'' was responsible for China's tendency toward political unification and Europe's protracted political fragmentation. We build a dynamic model with granular geographical information in terms of topographical features and the location of productive agricultural land to quantitatively gauge the effects of ``fractured land'' on state formation in Eurasia. We find that either topography or productive land alone is sufficient to account for China's recurring political unification and Europe's persistent political fragmentation. The existence of a core region of high land productivity in Northern China plays a central role in our simulations. We discuss how our results map into observed historical outcomes and assess how robust our findings are.