On the Move : Essays on the Economic and Political Development of Sweden

This thesis consists of four self-contained essays in economics. Their abstracts are presented below: Exit, Voice and Political Change: Evidence from Swedish Mass Migration to the United States. We study the political effects of mass emigration to the United States in the 19th century using data from Sweden. To instrument for total emigration over several decades, we exploit severe local frost shocks that sparked an initial wave of emigration, interacted with within-country travel costs. Our estimates show that emigration substantially increased the local demand for political change, as measured by labor movement membership, strike participation and voting. Emigration also led to de facto political change, increasing welfare expenditures as well as the likelihood of adopting more inclusive political institutions. Mass Migration, Cheap Labor, and Innovation. Migration is often depicted as a major problem for struggling developing countries, as they may lose valuable workers and human capital. Yet, its effects on sending regions are ambiguous and depend crucially on local market responses and migrant selection. This paper studies the effects of migration on technological innovation in sending communities during one of the largest migration episodes in human history: the Age of Mass Migration (1850-1913). Using novel historical data on Sweden, where about a quarter of its population migrated, we find that migration caused an increase in technological patents in sending municipalities. To establish causality, we use an instrumental variable design that exploits severe local growing season frost shocks together with within-country travel costs to reach an emigration port. Exploring possible mechanisms, we suggest that increased labor costs, due to low-skilled emigration, induced technological innovation. On the Right Track: Railroads, Mobility and Innovation During Two Centuries. We study the construction of the 19th-century Swedish railroad network and estimate its effects on innovation during two centuries. To address endogenous placement of the network, our analysis exploits the fact that the main trunk lines were built with the overarching aim to connect particular city centers, while at the same time considering construction costs. Estimates show that innovative activities increased substantially in areas traversed by the railroads. The number of active innovators increased and, moreover, they became more productive. Exploring potential mechanisms, we highlight the importance of knowledge diffusion across space by studying spatial patterns of collaboration between innovators. Our analysis shows that innovators residing in areas connected by the railroad start to collaborate more and over longer distances, especially with other innovators located along the railroad network. Finally, we show that the differences in innovative activities were intensified over the 20th century. Areas traversed by the historical railroads exhibit much higher rates of innovation in the present day. Homeownership, Housing Wealth and Socioeconomic Outcomes: Evidence from Sweden 1999-2007. This paper studies a government supported homeownership wave in Sweden, where tenants bought their apartments at prices below the market value in the ownership market. Using detailed administrative register data paired with a difference-in-differences strategy, it compares individuals subject to an ownership transfer to similar individuals who never got the opportunity to buy their homes. After establishing that the new homeowners instantly increased their net wealth, the effects of homeownership and housing wealth on a set of socioeconomic outcomes are measured over time. Although the lump-sum transfer is large, the average individual only modestly adjusts her behavior in terms of labor market participation and demographic decision-making. Studying differences across age, younger tenants increase childbearing and decrease labor income, although modestly. Individuals near their retirement age decrease their labor market participation