The Empire Is Dead Long Live the Empire Long Run Persistence of Trust and Corruption in the Bureaucracy*

The Empire Is Dead, Long Live the Empire! Long-Run Persistence of Trust and Corruption in the Bureaucracy* Sascha O. Becker (U Warwick, Ifo, CEPR, CESifo, and IZA)† Katrin Boeckh (OEI Regensburg and U Munich) Christa Hainz (Ifo, CESifo, and WDI) Ludger Woessmann (U Munich, Ifo, CESifo, and IZA) Do empires affect attitudes towards the state long after their demise? We hypothesize that the Habsburg Empire with its localized and well-respected administration increased citizens' trust in local public services. In several Eastern European countries, communities on both sides of the long-gone Habsburg border have been sharing common formal institutions for a century now. Identifying from individuals living within a restricted band around the former border, we find that historical Habsburg affiliation increases current trust and reduces corruption in courts and police. Falsification tests of spuriously moved borders, geographic and pre-existing differences, and interpersonal trust corroborate a genuine Habsburg effect. Keywords: Habsburg Empire, trust, corruption, institutions, borders JEL classification: N33, N34, D73, Z10 February 25, 2011 * We are grateful for substantive comments in seminars at the universities of Aberdeen, Cambridge, Copenhagen, UC Davis, Essex, Harvard, Lancaster, Linz, Mainz, Munich, EIEF Rome, Regensburg, Stanford, and Stirling, the Sciences Po/IZA Workshop in Paris, and the annual conferences of the European Economic Association in Glasgow, the German Economic Association in Kiel, the Scottish Economic Society in Perth, and

• european countries


• between historic


• leading mechanisms


• institution


• habsburg empire


• gone habsburg