How Merchant Towns Shaped Parliaments: from the Norman Conquest of England to the Great Reform Act

How Merchant Towns Shaped Parliaments: From the Norman Conquest of England to the Great Reform Act

Charles Angelucci, Simone Meraglia, Nico Voigtländer (Columbia) (Exeter) (UCLA and NBER)

March 3, 2020

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 1 / 46 Towns’ (and thus merchants’) foothold on power crucial during later critical junctures – e.g., major trade expansions (AJR 2005; Pascali 2017)

⇒ How did merchant towns gain direct representation in parliaments? ⇒ How did they interact with parliaments over subsequent centuries?

Motivation

Political institutions are important drivers of economic development (North and Thomas 1973; North, Wallis and Weingast 2009; Acemoglu and Robinson 2012) Historically, institutions were shaped by “coalition of power holders”

I Medieval period: king, nobility, high clergy

I Early modern period: towns ascended to coalition of power holders – and gained representation in parliaments across Western Europe

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 2 / 46 ⇒ How did merchant towns gain direct representation in parliaments? ⇒ How did they interact with parliaments over subsequent centuries?

Motivation

I Medieval period: king, nobility, high clergy

I Early modern period: towns ascended to coalition of power holders – and gained representation in parliaments across Western Europe Towns’ (and thus merchants’) foothold on power crucial during later critical junctures – e.g., major trade expansions (AJR 2005; Pascali 2017)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 2 / 46 ⇒ How did they interact with parliaments over subsequent centuries?

Motivation

I Medieval period: king, nobility, high clergy

⇒ How did merchant towns gain direct representation in parliaments?

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 2 / 46 Motivation

I Medieval period: king, nobility, high clergy

⇒ How did merchant towns gain direct representation in parliaments? ⇒ How did they interact with parliaments over subsequent centuries?

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 2 / 46 2 Self-governing towns ⇒ direct representation in parliament (13-14th century)

3 Self-governing towns ⇒ resisted patronage and strengthened parliament

This Paper: Overview

1 How towns obtained self-governance during the Commercial Revolution (11-13th century)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 3 / 46 3 Self-governing towns ⇒ resisted patronage and strengthened parliament

This Paper: Overview

1 How towns obtained self-governance during the Commercial Revolution (11-13th century)

2 Self-governing towns ⇒ direct representation in parliament (13-14th century)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 3 / 46 This Paper: Overview

1 How towns obtained self-governance during the Commercial Revolution (11-13th century)

2 Self-governing towns ⇒ direct representation in parliament (13-14th century)

3 Self-governing towns ⇒ resisted patronage and strengthened parliament

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 3 / 46 This Paper: England

Study England – “the mother of parliaments” Starting point: England in medieval times, before parliament

I Norman Conquest in 1066 ⇒ ‘strong’ monarchy, imposes homogeneous formal (de jure) institutions

I “Commercial Revolution” starting in 12C

I First (‘Model’) Parliament in 1295 Create novel dataset for 554 towns (boroughs) 1066-1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 4 / 46 ⇒ Farm Grants (“Charters of Liberties”): Mutually beneﬁcial contracts between monarch and merchant towns

I Self-administered tax collection

I Election of local ofﬁcials (legal and ﬁscal) Diagram

I Often granted during wars

Step 1 of the Argument: (Period: 1086-1348)

local self- merchant ⇒ towns governance | | inefﬁcient administration (judicial and ﬁscal)

Royal ofﬁcials (sheriffs) run towns’ administrations: “Tax Farming” But trade required specialized administration ⇒ distortions

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 5 / 46 Step 1 of the Argument: (Period: 1086-1348)

local self- merchant ⇒ towns governance | | inefﬁcient administration (judicial and ﬁscal)

Royal ofﬁcials (sheriffs) run towns’ administrations: “Tax Farming” But trade required specialized administration ⇒ distortions ⇒ Farm Grants (“Charters of Liberties”): Mutually beneﬁcial contracts between monarch and merchant towns

I Self-administered tax collection

I Election of local ofﬁcials (legal and ﬁscal) Diagram

I Often granted during wars

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 5 / 46 2. Local institutions: Persistent effects until 1830s

I Medieval Farm Grants ⇒ history of electing local ofﬁcials ⇒ resist royal attempts to introduce patronage

3. Nationwide institutions: Strengthening Parliament

I Farm Grants ⇒ support parliamentarians during Civil War in 1640s

I Farm Grants ⇒ support for Great Reform Act of 1832

Step 2 of the Argument:

local self- merchant ⇒ ⇒ institutional towns governance outcomes

1. Parliament: direct representation of towns (1295-1348)

I Farm Grants: Fiscal and judicial autonomy (separated from shire administration) ⇒ monarch summons Farm Grant boroughs to Parliament as separate constituencies to coordinate extra-ordinary taxation Diagram

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 6 / 46 3. Nationwide institutions: Strengthening Parliament

I Farm Grants ⇒ support parliamentarians during Civil War in 1640s

I Farm Grants ⇒ support for Great Reform Act of 1832

Step 2 of the Argument:

local self- merchant ⇒ ⇒ institutional towns governance outcomes

1. Parliament: direct representation of towns (1295-1348)

2. Local institutions: Persistent effects until 1830s

I Medieval Farm Grants ⇒ history of electing local ofﬁcials ⇒ resist royal attempts to introduce patronage

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 6 / 46 Step 2 of the Argument:

local self- merchant ⇒ ⇒ institutional towns governance outcomes

1. Parliament: direct representation of towns (1295-1348)

2. Local institutions: Persistent effects until 1830s

I Medieval Farm Grants ⇒ history of electing local ofﬁcials ⇒ resist royal attempts to introduce patronage

3. Nationwide institutions: Strengthening Parliament

I Farm Grants ⇒ support parliamentarians during Civil War in 1640s

I Farm Grants ⇒ support for Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 6 / 46 Data Collection

Cover all 554 English boroughs (towns) that existed by 1348

I Timing and extent of Charters of Liberties (Farm Grants) Royal Rolls

I Timing of Parliamentary enfranchisement (1295-1832)

I Geography, ownership, commercial importance of boroughs

We also collect data on:

I Incorporation of boroughs

I Boroughs’ franchise types and openness of local elections

I Volunteer troops during the Civil War in 1642

I MPs’ voting behavior during Great Reform Act of 1832 (Aidt and Franck 2015).

Detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 7 / 46 Checking validity of the exclusion restriction: For historical reasons, boroughs owned by lords almost never got Farm Grants Using subsample of lords’ boroughs:

trade institutional ¨⇒H¨H geography outcomes

Empirical Implementation

trade ⇒ Farm ⇒ institutional geography Grants outcomes

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 8 / 46 Empirical Implementation

trade ⇒ Farm ⇒ institutional geography Grants outcomes

Checking validity of the exclusion restriction: For historical reasons, boroughs owned by lords almost never got Farm Grants Using subsample of lords’ boroughs:

trade institutional ¨⇒H¨H geography outcomes

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 8 / 46 Related Literature and Contribution Emergence of constraints on executive

I Merchant interests and institutions (North and Thomas 1973, Barzel 1989, Stasavage 2014, Puga and Treﬂer 2014) I “Administrative power” (González de Lara, et al. 2008, Greif 2008) I Parliament as coordination device (Levi 1988, Root 1994) I This paper: establishes link between trade and municipal autonomy, and between autonomy and parliamentary representation

State Capacity and Institutional Divergence ⇒ England vs Continental Europe (Epstein 2000, North, Wallis and Weingast 2009, Besley and Persson 2009, Van Zanden et al. 2012, Gennaioli and Voth 2015)

I This paper: Interaction between local and ‘national’ institutions

Org. Econ: Incomplete contracts (Grossman and Hart, 1986; Hart and Moore, 1988, 1990)

I Farm Grants = incomplete agreements that did not describe taxation during extraordinary events (e.g., wars). I Parliament = “court of justice” where king and representatives negotiated and coordinated extra-ordinary taxes

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 9 / 46 Outline of the Talk

1 Background: Norman Conquest and Tax Farming

2 Farm Grants and Self-Governance

3 Parliament

4 Long-run Results

I Local elections in 15C to 1830s I Civil War in 1640s I Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 10 / 46 “The Norman conquest...was the single greatest political change England has ever seen.” [Economist Dec 2016] Farage

pre-Conquest

The Norman Conquest of 1066

Coalition of power holders ‘reset’ throughout England Existing ruling elites (incl. clergy) replaced by Norman lords Normans implemented homogeneous feudal institutions across England

I Land ownerships = military service to the king I Manorial system: serf labor

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 11 / 46 The Norman Conquest of 1066

Coalition of power holders ‘reset’ throughout England Existing ruling elites (incl. clergy) replaced by Norman lords Normans implemented homogeneous feudal institutions across England

I Land ownerships = military service to the king I Manorial system: serf labor

“The Norman conquest...was the single greatest political change England has ever seen.” [Economist Dec 2016] Farage

pre-Conquest

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 11 / 46 Balancedness Royal-Mesne:

I Similar taxable wealth in 1086 Distribution

I Geography: Use Entropy Balancing / Matching Table

Organization after the Norman Conquest

Boroughs divided between feudal lords: 1. The King (25%) 2. Mesne lords: Lay (50%), and ecclesiastical (25%). Map

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 12 / 46 Organization after the Norman Conquest

Boroughs divided between feudal lords: 1. The King (25%) 2. Mesne lords: Lay (50%), and ecclesiastical (25%). Map

Balancedness Royal-Mesne:

I Similar taxable wealth in 1086 Distribution

I Geography: Use Entropy Balancing / Matching Table

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 12 / 46 Tax Collection in Royal and Mesne Territories

Inefﬁcient local administration ⇒ Farm Grants

I Particularly severe in royal territories I Mesne lords rarely issue Farm Grants Back to Talk

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 13 / 46 Farm Grants separated towns from shire’s jurisdiction ⇒ Difﬁcult to assess wealth and enforce extra-ordinary taxation Back to Talk

Tax Collection in Royal and Mesne Territories

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 14 / 46 Tax Collection in Royal and Mesne Territories

Farm Grants separated towns from shire’s jurisdiction ⇒ Difﬁcult to assess wealth and enforce extra-ordinary taxation Back to Talk

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 14 / 46 Outline of the Talk

1 Background: Norman Conquest and Tax Farming

2 Farm Grants and Self-Governance

3 Parliament

4 Long-run Results

I Local elections in 15C to 1830s I Civil War in 1640s I Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 15 / 46 Step 1 of the Argument: Farm Grants

local self- merchant ⇒ governance towns | | self-administered tax collection is more efficient Inefficient fiscal and judicial administration ⇒ Efficiency-increasing contracts: Farm Grants

I Self-administered tax collection and contract enforcement I Right to appoint local ofﬁcials: mayor, bailiff, constable, market viewer, ale-taster, etc.

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 16 / 46 Likely explanation: Stronger need to delegate tax collection in royal territories

I Much larger territory controlled by king I Question for the king was: delegate to whom – either a private individual (sheriff) or local community I In contrast: No need to delegate for local mesne lords Not driven by taxable wealth, soil suitability, pre-existing kingdoms Table

Farm Grants: Royal Boroughs

600 All boroughs Boroughs with Farm Grant ⇒ Farm Grants almost 500 exclusively granted to royal 400 boroughs 300 I 51.0% of royal boroughs 200 Number of boroughs get farm grants

100 I 3.9% of mesne

0 boroughs All Royal Mesne Boroughs included

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 17 / 46 Not driven by taxable wealth, soil suitability, pre-existing kingdoms Table

Farm Grants: Royal Boroughs

600 All boroughs Boroughs with Farm Grant ⇒ Farm Grants almost 500 exclusively granted to royal 400 boroughs 300 I 51.0% of royal boroughs 200 Number of boroughs get farm grants

100 I 3.9% of mesne

0 boroughs All Royal Mesne Boroughs included

Likely explanation: Stronger need to delegate tax collection in royal territories

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 17 / 46 Farm Grants: Royal Boroughs

600 All boroughs Boroughs with Farm Grant ⇒ Farm Grants almost 500 exclusively granted to royal 400 boroughs 300 I 51.0% of royal boroughs 200 Number of boroughs get farm grants

100 I 3.9% of mesne

0 boroughs All Royal Mesne Boroughs included

Likely explanation: Stronger need to delegate tax collection in royal territories

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 17 / 46 ⇒ Use trade geography to predict merchant activity

Location on sea coast Navigable river Roman roads

Map Farm Grants

Which (Royal) Boroughs got Farm Grants?

Efﬁciency gains due to self-administration strongest for merchant towns

Particularly strong need for efﬁcient administration and law enforcement

Lots of historical evidence... Statute of Merchants Bristol’s petition

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 18 / 46 Which (Royal) Boroughs got Farm Grants?

Efﬁciency gains due to self-administration strongest for merchant towns

Particularly strong need for efﬁcient administration and law enforcement

Lots of historical evidence... Statute of Merchants Bristol’s petition

⇒ Use trade geography to predict merchant activity

Location on sea coast Navigable river Roman roads

Map Farm Grants

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 18 / 46 Trade Geography and Farm Grants Boroughs at locations that favored trade were more likely to receive Farm Grants This relationship holds only for royal boroughs Dependent variable: Indicator for boroughs that obtained Farm Grants by 1348 (1) (2) (3) (4) (5) (6) (7) (8) Boroughs included: all royal mesne mesne all all all all Note on Balancing Royal Balanced by Balanced by: and Mesne Boroughs: Trade Geo‡ Trade Geo‡ Trade & Wealth‡ Navigable River 0.210∗∗∗ 0.289∗∗∗ 0.002 0.012 0.002 0.012 0.012 0.021 (0.050) (0.079) (0.028) (0.032) (0.028) (0.037) (0.032) (0.043) Sea Coast 0.143∗∗∗ 0.422∗∗∗ -0.009 -0.005 -0.009 -0.011 -0.005 0.006 (0.043) (0.081) (0.023) (0.024) (0.023) (0.029) (0.024) (0.040) Roman Road 0.104∗∗∗ 0.207∗∗∗ -0.020 -0.015 -0.020 -0.013 -0.015 -0.044∗∗ (0.035) (0.076) (0.019) (0.020) (0.019) (0.024) (0.020) (0.021) p-value joint signiﬁcance [<0.001] [<0.001] [0.730] [0.687] [0.732] [0.866] [0.688] [0.064] River, Coast, Road River x Royal 0.288∗∗∗ 0.289∗∗∗ 0.278∗∗∗ 0.278∗∗ (0.083) (0.088) (0.084) (0.116) Sea Coast x Royal 0.431∗∗∗ 0.416∗∗∗ 0.428∗∗∗ 0.537∗∗∗ (0.084) (0.088) (0.084) (0.122) Roman Road x Royal 0.227∗∗∗ 0.258∗∗∗ 0.222∗∗∗ 0.259∗∗ (0.078) (0.080) (0.078) (0.103) Royal borough 0.171∗∗∗ 0.161∗∗∗ 0.175∗∗∗ 0.173∗∗ (0.062) (0.060) (0.062) (0.081) County FE X Mean Dep. Var. 0.16 0.51 0.04 0.04 0.16 0.16 0.27 0.16 R2 0.09 0.21 0.00 0.00 0.42 0.46 0.41 0.40 Observations 554 145 409 409 554 554 554 354 Notes: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

E-weights detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 19 / 46 Trade Geography and Farm Grants Boroughs at locations that favored trade were more likely to receive Farm Grants This relationship holds only for royal boroughs Dependent variable: Indicator for boroughs that obtained Farm Grants by 1348 (1) (2) (3) (4) (5) (6) (7) (8) Boroughs included: all royal mesne mesne all all all all Note on Balancing Royal Balanced by Balanced by: and Mesne Boroughs: Trade Geo‡ Trade Geo‡ Trade & Wealth‡ Navigable River 0.210∗∗∗ 0.289∗∗∗ 0.002 0.012 0.002 0.012 0.012 0.021 (0.050) (0.079) (0.028) (0.032) (0.028) (0.037) (0.032) (0.043) Sea Coast 0.143∗∗∗ 0.422∗∗∗ -0.009 -0.005 -0.009 -0.011 -0.005 0.006 (0.043) (0.081) (0.023) (0.024) (0.023) (0.029) (0.024) (0.040) Roman Road 0.104∗∗∗ 0.207∗∗∗ -0.020 -0.015 -0.020 -0.013 -0.015 -0.044∗∗ (0.035) (0.076) (0.019) (0.020) (0.019) (0.024) (0.020) (0.021) p-value joint signiﬁcance [<0.001] [<0.001] [0.730] [0.687] [0.732] [0.866] [0.688] [0.064] River, Coast, Road River x Royal 0.288∗∗∗ 0.289∗∗∗ 0.278∗∗∗ 0.278∗∗ (0.083) (0.088) (0.084) (0.116) Sea Coast x Royal 0.431∗∗∗ 0.416∗∗∗ 0.428∗∗∗ 0.537∗∗∗ (0.084) (0.088) (0.084) (0.122) Roman Road x Royal 0.227∗∗∗ 0.258∗∗∗ 0.222∗∗∗ 0.259∗∗ (0.078) (0.080) (0.078) (0.103) Royal borough 0.171∗∗∗ 0.161∗∗∗ 0.175∗∗∗ 0.173∗∗ (0.062) (0.060) (0.062) (0.081) County FE X Mean Dep. Var. 0.16 0.51 0.04 0.04 0.16 0.16 0.27 0.16 R2 0.09 0.21 0.00 0.00 0.42 0.46 0.41 0.40 Observations 554 145 409 409 554 554 554 354 Notes: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

E-weights detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 19 / 46 Additional Results on Geography

Farm Grants strongly correlated with commercial importance in 14C Table

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 20 / 46 Outline of the Talk

1 Background: Norman Conquest and Tax Farming

2 Farm Grants and Self-Governance

3 Parliament

4 Long-run Results

I Local elections in 15C to 1830s I Civil War in 1640s I Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 21 / 46 Farm Grants ⇒ autonomous jurisdictions (separated from shire courts) with administrative capability ⇒ King summoned Farm Grant boroughs as separate constituencies (direct representation) to ensure:

I cooperation of local authorities in collecting extra-ordinary taxes I coordination of extra-ordinary taxation with the rest of the realm

Background Parliament Early vs. Late Enfranchisement Historical Evidence

Step 2: From Farm Grants to Parliament

representation in parliament local self- % merchant ⇒ towns governance &

Note: All boroughs represented via knights of the shire (elected by all freeholders in the shire)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 22 / 46 ⇒ King summoned Farm Grant boroughs as separate constituencies (direct representation) to ensure:

I cooperation of local authorities in collecting extra-ordinary taxes I coordination of extra-ordinary taxation with the rest of the realm

Background Parliament Early vs. Late Enfranchisement Historical Evidence

Step 2: From Farm Grants to Parliament

representation in parliament local self- % merchant ⇒ towns governance &

Note: All boroughs represented via knights of the shire (elected by all freeholders in the shire) Farm Grants ⇒ autonomous jurisdictions (separated from shire courts) with administrative capability

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 22 / 46 Step 2: From Farm Grants to Parliament

representation in parliament local self- % merchant ⇒ towns governance &

Note: All boroughs represented via knights of the shire (elected by all freeholders in the shire) Farm Grants ⇒ autonomous jurisdictions (separated from shire courts) with administrative capability ⇒ King summoned Farm Grant boroughs as separate constituencies (direct representation) to ensure:

I cooperation of local authorities in collecting extra-ordinary taxes I coordination of extra-ordinary taxation with the rest of the realm

Background Parliament Early vs. Late Enfranchisement Historical Evidence

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 22 / 46 Direct Representation in Parliament by 1348 Boroughs with Farm Grants were more likely to have seats in Parliament Dependent variable: Indicator for borough enfranchised in Parliament by 1348 (1) (2) (3) (4) (5) (6) (7) (8) Boroughs included: all all royal royal mesne mesne all all Notes: E-weights§ 2SLS† 2SLS‡ Farm Grant 1348 0.466∗∗∗ 0.451∗∗∗ 0.558∗∗∗ 0.718∗∗∗ 0.639∗∗∗ (0.063) (0.064) (0.069) (0.162) (0.174) Royal borough 0.154∗∗∗ 0.159∗∗∗ 0.035 0.063 (0.050) (0.049) (0.091) (0.092) Navigable River 0.197∗∗ -0.006 -0.024 -0.002 (0.084) (0.052) (0.048) (0.041) Sea Coast 0.264∗∗∗ 0.078 0.031 0.055 (0.094) (0.048) (0.044) (0.041) Roman Road 0.280∗∗∗ -0.021 -0.058 0.039 (0.080) (0.036) (0.037) (0.033) p-value joint signiﬁcance [<0.001] [0.366] [0.291] [0.398] River, Coast, Road County FE X Soil Quality X Mean Dep. Var. 0.23 0.23 0.51 0.51 0.14 0.13 0.23 0.23 R2 0.26 0.36 0.31 0.13 0.01 0.01 Observations 554 554 145 145 409 409 554 554

Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † Two-stage least square regression that uses the three trade geography variables in levels and interacted with Royal. ‡ Two-stage least square regression that uses only the three interaction terms and controls for the variables in levels. Entropy Balancing Map Enfranch. Illustration DD

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 23 / 46 Direct Representation in Parliament by 1348 Boroughs with Farm Grants were more likely to have seats in Parliament Dependent variable: Indicator for borough enfranchised in Parliament by 1348 (1) (2) (3) (4) (5) (6) (7) (8) Boroughs included: all all royal royal mesne mesne all all Notes: E-weights§ 2SLS† 2SLS‡ Farm Grant 1348 0.466∗∗∗ 0.451∗∗∗ 0.558∗∗∗ 0.718∗∗∗ 0.639∗∗∗ (0.063) (0.064) (0.069) (0.162) (0.174) Royal borough 0.154∗∗∗ 0.159∗∗∗ 0.035 0.063 (0.050) (0.049) (0.091) (0.092) Navigable River 0.197∗∗ -0.006 -0.024 -0.002 (0.084) (0.052) (0.048) (0.041) Sea Coast 0.264∗∗∗ 0.078 0.031 0.055 (0.094) (0.048) (0.044) (0.041) Roman Road 0.280∗∗∗ -0.021 -0.058 0.039 (0.080) (0.036) (0.037) (0.033) p-value joint signiﬁcance [<0.001] [0.366] [0.291] [0.398] River, Coast, Road County FE X Soil Quality X Mean Dep. Var. 0.23 0.23 0.51 0.51 0.14 0.13 0.23 0.23 R2 0.26 0.36 0.31 0.13 0.01 0.01 Observations 554 554 145 145 409 409 554 554

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 23 / 46 Plausibility/Robustness checks:

I Geography predicts economic outcomes in both royal and mesne

I Wealth as confounding factor?

F Matching by Borough Wealth and Size F Different parts of the wealth distribution

I Trade potential as confounding factor? Exact Matching

I Unobservable characteristics? Domesday Boroughs

Use Mesne Boroughs to Check Exclusion Restriction

Almost no Farm Grants in mesne territories Mesne lord towns otherwise similar to royal towns

I Equally affected by extra-ordinary taxation I Similar number of mesne boroughs represented in Parliament I Same administrative procedure to summon boroughs to Parliament

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 24 / 46 I Wealth as confounding factor?

F Matching by Borough Wealth and Size F Different parts of the wealth distribution

I Trade potential as confounding factor? Exact Matching

I Unobservable characteristics? Domesday Boroughs

Use Mesne Boroughs to Check Exclusion Restriction

Almost no Farm Grants in mesne territories Mesne lord towns otherwise similar to royal towns

I Equally affected by extra-ordinary taxation I Similar number of mesne boroughs represented in Parliament I Same administrative procedure to summon boroughs to Parliament Plausibility/Robustness checks:

I Geography predicts economic outcomes in both royal and mesne

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 24 / 46 Use Mesne Boroughs to Check Exclusion Restriction

Almost no Farm Grants in mesne territories Mesne lord towns otherwise similar to royal towns

I Geography predicts economic outcomes in both royal and mesne

I Wealth as confounding factor?

F Matching by Borough Wealth and Size F Different parts of the wealth distribution

I Trade potential as confounding factor? Exact Matching

I Unobservable characteristics? Domesday Boroughs

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 24 / 46 Robustness of Results on Parliament

Ability to Coordinate

Model Parliament

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 25 / 46 This reinforced their separation from that shire administration

Additional Charters of Liberties

Some boroughs negotiated additional liberties: Royal ofﬁcials forbidden from entering the borough...

I In judicial functions (non-intromittat)

I To enforce royal orders (return of writs)

I In ﬁnancial functions (direct access to the Exchequer)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 26 / 46 Additional Charters of Liberties

Some boroughs negotiated additional liberties: Royal ofﬁcials forbidden from entering the borough...

I In judicial functions (non-intromittat)

I To enforce royal orders (return of writs)

I In ﬁnancial functions (direct access to the Exchequer) This reinforced their separation from that shire administration

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 26 / 46 Constraints on Entry of Royal Ofﬁcials Boroughs that also had constraints on the sheriff entering the town were even more likely to be enfranchised

1 Share 95% CI .8 .6 .4 .2 Share of Enfranchised Boroughs 0 Farm Grant, constr. sheriff Farm Grant, no constr. no Farm Grant Boroughs included

Constraints on sheriff in judicial functions (non-intromittat), in ﬁnancial functions (direct access to the Exchequer), or enforcing royal orders (return of writs).

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 27 / 46 Outline of the Talk

1 Background: Norman Conquest and Tax Farming

2 Farm Grants and Self-Governance

3 Parliament

4 Long-run Results

I Local elections in 15C to 1830s I Civil War in 1640s I Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 28 / 46 We show: Farm Grant boroughs resisted royal patronage and strengthened Parliament

I Broad local elites in Farm Grant boroughs had more to lose under patronage and restriction of voting rights

I These broad elites were also able to resist Crown’s interference due to their local autonomy

Brief Historical Background for England after 15C

By the 16th century, the Crown faced rising costs of war and increasing debt Crown attempted to weaken both Parliament and municipal liberties

I Municipal level: Patronage – Widespread attempts to install narrow oligarchies in boroughs and strike bilateral deals with them

I Parliament: Attempts by the Crown to inﬂuence elections of MPs; surge in “rotten boroughs”

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 29 / 46 Brief Historical Background for England after 15C

By the 16th century, the Crown faced rising costs of war and increasing debt Crown attempted to weaken both Parliament and municipal liberties

I Municipal level: Patronage – Widespread attempts to install narrow oligarchies in boroughs and strike bilateral deals with them

I Parliament: Attempts by the Crown to inﬂuence elections of MPs; surge in “rotten boroughs”

We show: Farm Grant boroughs resisted royal patronage and strengthened Parliament

I Broad local elites in Farm Grant boroughs had more to lose under patronage and restriction of voting rights

I These broad elites were also able to resist Crown’s interference due to their local autonomy

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 29 / 46 Independence in Appointing Local Ofﬁcials and MPs

representation in parliament local self- % merchant ⇒ towns governance & more open local institutions

Self-governance leads to more open and independent local institutions: We examine two dimensions:

I King’s inﬂuence on appointment of town ofﬁcials after towns’ incorporation in 15-17C Detail

I Openness of local MP elections in 1690-1830

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 30 / 46 Influence of the King on Local Politics, 15C-17C The king had less influence on appointing officials in towns with Farm Grants. This limited the king’s ability to engage in patronage (bypassing Parliament)

Dep. Var.: Dummy for strong inﬂuence of the king on appointment of local ofﬁcials (1) (2) (3) (4) Note: royal only 2SLS† Farm Grant 1348 -0.222∗∗ -0.277∗∗ -0.345∗∗∗ -0.539∗∗ (0.104) (0.128) (0.122) (0.215) Royal borough 0.120 0.164 0.316∗∗ (0.103) (0.133) (0.158) County FE X Soil Quality X Mean Dep. Var. 0.42 0.42 0.42 0.42 R2 0.03 0.28 0.10 Observations 158 158 77 158

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † Two-stage least square regression that uses the following variables to predict Farm Grants by 1348 in the first stage: location on the sea coast, on a navigable river, and on Roman roads, and the interaction of these three variables with status as royal borough. Since the dependent variable reflects royal influence, the status as royal borough is included as a control. The first-stage F-statistic is 9.16 (corresponding to a max. 10% relative bias)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 31 / 46 Important because open local elections limited patronage in Parliament

more background

Election of MPs at the Borough (Town) Level

We examine: 1. how open were elections to candidates 2. how broad were voting rights

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 32 / 46 Election of MPs at the Borough (Town) Level

We examine: 1. how open were elections to candidates 2. how broad were voting rights

Important because open local elections limited patronage in Parliament

more background

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 32 / 46 Openness of MP Elections in 1690-1832

Data from the History of Parliament for all enfranchised boroughs Dummy for MP candidate openness

I Indicates open elections for a borough’s MPs (as opposed to MPs chosen by patron)

Dependent variable: Indicator for Open MP elections (1) (2) (3) (4) (5) Period considered 1820-31 1790-1820 1754-90 1715-54 1690-1715 Farm Grant 1348 0.149∗∗ 0.172∗∗ 0.188∗∗∗ 0.149∗ 0.248∗∗ (0.063) (0.068) (0.070) (0.076) (0.100) County FE XXXXX Mean Dep. Var. 0.15 0.20 0.23 0.25 0.37 R2 0.30 0.34 0.31 0.33 0.29 Observations 185 184 185 185 161

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 33 / 46 Dependent variable: Indicator for Broad Franchise over the indicated period (1) (2) (3) (4) (5) (6) (7) Period considered 1820-31 1790-1820 1754-90 1715-54 1690-1715 1660-90 1604-29 Farm Grant 1348 0.143∗∗ 0.208∗∗∗ 0.200∗∗∗ 0.199∗∗∗ 0.237∗∗∗ 0.300∗∗∗ 0.147∗∗ (0.071) (0.067) (0.067) (0.067) (0.057) (0.064) (0.073) County FE XXXXXXX Mean Dep. Var. 0.69 0.71 0.72 0.73 0.76 0.71 0.70 R2 0.28 0.32 0.32 0.30 0.32 0.38 0.33 Observations 185 185 184 186 185 184 176

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. The number of observations varies across the different time periods, depending on the availability of the necessary information in the sources.

Alternative measures for ‘openness’ of MP elections yield very similar results detail

Franchise Rules in MP Elections in 1604-1831 Data from the History of Parliament Dummy for broad franchise in voting for a borough’s MP candidates

I Indicates how broad the local electorate was in MP elections

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 34 / 46 Alternative measures for ‘openness’ of MP elections yield very similar results detail

Franchise Rules in MP Elections in 1604-1831 Data from the History of Parliament Dummy for broad franchise in voting for a borough’s MP candidates

I Indicates how broad the local electorate was in MP elections

Dependent variable: Indicator for Broad Franchise over the indicated period (1) (2) (3) (4) (5) (6) (7) Period considered 1820-31 1790-1820 1754-90 1715-54 1690-1715 1660-90 1604-29 Farm Grant 1348 0.143∗∗ 0.208∗∗∗ 0.200∗∗∗ 0.199∗∗∗ 0.237∗∗∗ 0.300∗∗∗ 0.147∗∗ (0.071) (0.067) (0.067) (0.067) (0.057) (0.064) (0.073) County FE XXXXXXX Mean Dep. Var. 0.69 0.71 0.72 0.73 0.76 0.71 0.70 R2 0.28 0.32 0.32 0.30 0.32 0.38 0.33 Observations 185 185 184 186 185 184 176

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 34 / 46 Franchise Rules in MP Elections in 1604-1831 Data from the History of Parliament Dummy for broad franchise in voting for a borough’s MP candidates

I Indicates how broad the local electorate was in MP elections

Alternative measures for ‘openness’ of MP elections yield very similar results detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 34 / 46 Nationwide Institutions

representation in parliament local self- %& merchant ⇒ ⇒ nationwide towns governance &%more open institutions local institutions

Civil War in 1640s Great Reform Act of 1832

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 35 / 46 Civil War of 1642-51: Background

Conﬂict between Royalists (supported personal rule by Charles I) and Parliamentarians (“Roundheads”)

March 1642: Parliament splits; royal faction moves to Oxford Parliamentarians raise volunteer troops, often from towns

I Rely on local administration to do so

I June-Sep 1642: 31 towns raise volunteer troops to defend parliamentarians (data from Russel, 1990)

more detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 36 / 46 Farm Grants and Parliamentarian Volunteer Troops Boroughs with Farm Grants were more likely to raise volunteer troops in support of the parliamentarians

.35 Share 95% CI .3 .25 .2 .15 .1 Share of Boroughs with Militia .05 0 Farm Grant no Farm Grant Boroughs included

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 37 / 46 Support for Parliamentarians during the Civil War Medieval Farm Grants are a strong predictor of pro-parliamentarian volunteer troops

Dependent variable: Indicator for pro-Parliamentary volunteer troops raised by borough in 1642 (1) (2) (3) (4) (5) (6) (7) Notes: Enfranchised by 1640 royal only royal only 2SLS† 2SLS‡ Farm Grant 1348 0.201∗∗∗ 0.188∗∗∗ 0.242∗∗∗ 0.224∗∗∗ 0.244∗∗∗ 0.259∗∗∗ 0.275∗∗ (0.045) (0.042) (0.053) (0.066) (0.068) (0.065) (0.126) Royal borough 0.019 0.014 -0.022 -0.033 (0.022) (0.025) (0.055) (0.052) County FE X Soil Quality X River, Coast, Road X Mean Dep. Var. 0.055 0.055 0.139 0.148 0.209 0.055 0.055 R2 0.12 0.24 0.12 0.08 0.08 0.12 Observations 550 550 144 189 91 550 550

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † Two-stage least square regression that uses the following variables to predict Farm Grants by 1348 in the first stage: location on the sea coast, on a navigable river, and on Roman roads, and the interaction of these three variables with status as royal borough, as well as the status as royal borough itself. The first-stage F-statistic is 20.5 (corresponding to a max. 5% relative bias). ‡ Two-stage least square regression that uses only the interaction terms and controls for all level variables. The first-stage F- statistic is 13.5 (corresponding to a max. 5% relative bias).

Reduced Form

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 38 / 46 Why did Farm Grant Boroughs support Parliament?

Weakening of Parliament would have jeopardized towns’ liberties and ability to collectively negotiate taxes

Administrative autonomy of Farm Grant boroughs enabled them to organize military action independently

⇒ Interaction between local and ‘nationwide’ institutions

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 39 / 46 The Great Reform Act of 1832 Reduced patronage in Parliament by adopting homogeneous rules

Redistribution of Seats: enfranchise newly industrialized boroughs; disenfranchise small boroughs

I Boroughs with less than 2,000 inhabitants to be disenfranchised I Boroughs with between 2,000 and 4,000 to lose one MP I Boroughs with > 10,000 to be enfranchised (e.g., Manchester)

Extend the Franchise: uniform borough franchise based on wealth and residency

I Population with voting rights goes from 3% to 6-7% I Occupiers of a house worth at least 10 pounds per year I Existing electors to retain votes if residents

more detail

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 40 / 46 Data on MP Voting during the Great Reform Act

Examine two voting rounds on the Reform Act: 1. March 1831: a First Bill passes in the Commons (302 to 301), but is rejected by the House of Lords

I New parliament elected in April 1831

2. December 1831: the (revised) Bill passes in the Commons (324 to 162), and is then approved also by the Lords

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 41 / 46 MP Votes Supporting the Great Reform Act Medieval Farm Grants are a strong predictor of support for the Great Reform Act

Dependent variables: Share of votes in favor of the Reform Act at different points in 1831 (1) (2) (3) (4) (5) (6) (7) Vote in: March 1831 — December 1831 — Notes: royal only 2SLS† 2SLS† Farm Grant 1348 0.023 0.157∗∗ 0.117∗∗ 0.176∗∗ 0.111∗ 0.231∗∗ 0.158∗∗ (0.062) (0.070) (0.055) (0.078) (0.064) (0.096) (0.075) Disenfranchise -0.286∗∗∗ -0.304∗∗∗ -0.168∗∗∗ -0.098 -0.189∗∗∗ -0.283∗∗∗ -0.179∗∗∗ (0.060) (0.073) (0.058) (0.092) (0.071) (0.076) (0.063) March 1831 votes 0.737∗∗∗ 0.686∗∗∗ 0.735∗∗∗ 0.734∗∗∗ (0.057) (0.091) (0.076) (0.066) Swing Riot within 10km 0.107∗∗ 0.180∗∗ 0.098 0.096 (0.053) (0.078) (0.112) (0.096) County FE XX Soil Quality # XX Additional Controls XX Mean Dep. Var. 0.47 0.56 0.56 0.70 0.56 0.56 0.56 R2 0.13 0.16 0.57 0.56 0.64 Observations 175 175 175 79 175 175 175

Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. # Additional controls: market integration (travel distance between any given constituency and the 243 other constituencies weighted by the population); Distance to urban center (travel days from each constituency to the nearest of the 13 largest towns in 1831); Connection to London (geographical, economic, and informational connections to London). Explanations for support

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 42 / 46 MP Votes Supporting the Great Reform Act Medieval Farm Grants are a strong predictor of support for the Great Reform Act

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 42 / 46 Dependent variable as indicated in table header (1) (2) (3) (4) (5) (6) (7) Plausibility checks Long-run institutional outcomes Pre-1348 outcomes Post-1348 outcomes Dependent variable: ln(Taxable Commercial Im- Trade employment Population in Volunteer troops Openness of MP Vote share for Great Wealth in 1086) portance 14C† share in 1831 17th century during Civil War elections 1820-31‡ Reform Act 1832 Trade not obstructed after Farm Grant 0.592∗∗∗ 1.546∗∗∗ 0.086∗∗∗ 1.027∗∗∗ 0.230∗∗∗ 0.731∗∗∗ 0.252∗∗∗ (0.211) (0.185) (0.021) (0.150) (0.052) (0.171) (0.073) Trade obstructed after Farm Grant 0.987∗∗∗ 1.632∗∗∗ 0.004 0.093 0.157∗ 0.488∗∗ 0.246∗ (0.353) (0.279) (0.032) (0.263) (0.093) (0.202) (0.130) p-value: test for [0.323] [0.796] [0.020] [0.002] [0.488] [0.303] [0.966] equality of coefﬁcients Mean Dep. Var. 1.69 [s.d.=1]† 0.39 6.89 0.05 [s.d.=1]‡ 0.56 R2 0.04 0.33 0.09 0.17 0.13 0.11 0.07 Observations 354 554 190 403 549 184 175 Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † First principle component of two indicators for commercial importance: “Freedom from tolls” (a grant of liberty that exempted a borough’s burgesses from tolls throughout the realm) and an indicator variable for whether a borough was a commercial hub during the 14th century. ‡ First principle component of our four proxies for open MP elections.

Placebo: Obstruction of Trade after Farm Grants

Code boroughs where trade was obstructed after Farm Grants Silting of rivers and harbors Construction of watermills along river → hampered transport

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Placebo: Obstruction of Trade after Farm Grants

Code boroughs where trade was obstructed after Farm Grants Silting of rivers and harbors Construction of watermills along river → hampered transport

Dependent variable as indicated in table header (1) (2) (3) (4) (5) (6) (7) Plausibility checks Long-run institutional outcomes Pre-1348 outcomes Post-1348 outcomes Dependent variable: ln(Taxable Commercial Im- Trade employment Population in Volunteer troops Openness of MP Vote share for Great Wealth in 1086) portance 14C† share in 1831 17th century during Civil War elections 1820-31‡ Reform Act 1832 Trade not obstructed after Farm Grant 0.592∗∗∗ 1.546∗∗∗ 0.086∗∗∗ 1.027∗∗∗ 0.230∗∗∗ 0.731∗∗∗ 0.252∗∗∗ (0.211) (0.185) (0.021) (0.150) (0.052) (0.171) (0.073) Trade obstructed after Farm Grant 0.987∗∗∗ 1.632∗∗∗ 0.004 0.093 0.157∗ 0.488∗∗ 0.246∗ (0.353) (0.279) (0.032) (0.263) (0.093) (0.202) (0.130) p-value: test for [0.323] [0.796] [0.020] [0.002] [0.488] [0.303] [0.966] equality of coefﬁcients Mean Dep. Var. 1.69 [s.d.=1]† 0.39 6.89 0.05 [s.d.=1]‡ 0.56 R2 0.04 0.33 0.09 0.17 0.13 0.11 0.07 Observations 354 554 190 403 549 184 175 Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † First principle component of two indicators for commercial importance: “Freedom from tolls” (a grant of liberty that exempted a borough’s burgesses from tolls throughout the realm) and an indicator variable for whether a borough was a commercial hub during the 14th century. ‡ First principle component of our four proxies for open MP elections.

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Placebo: Obstruction of Trade after Farm Grants

Code boroughs where trade was obstructed after Farm Grants Silting of rivers and harbors Construction of watermills along river → hampered transport

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Placebo: Obstruction of Trade after Farm Grants

Code boroughs where trade was obstructed after Farm Grants Silting of rivers and harbors Construction of watermills along river → hampered transport

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Placebo: Obstruction of Trade after Farm Grants

Code boroughs where trade was obstructed after Farm Grants Silting of rivers and harbors Construction of watermills along river → hampered transport

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Long-Run Results: Additional Robustness Checks

Clustering and Spatial Correlation

Controlling for Taxable Wealth in 1086

(Exact) Matching by Trade Geography

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 44 / 46 Virtuous interaction between municipal self-governance and Parliament in England

Conclusion

We study merchant towns’ ascent to coalition of power holders

Economic development ⇒ institutions trade and local self- ⇒ ⇒ parliament commerce governance

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 45 / 46 Conclusion

We study merchant towns’ ascent to coalition of power holders

Economic development ⇒ institutions trade and local self- ⇒ ⇒ parliament commerce governance

Virtuous interaction between municipal self-governance and Parliament in England

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 45 / 46 Continental Europe: Differences to England

I Continental monarchs were initially weaker vis-à-vis lords ⇒ fragmented jurisdictions

I To expand their inﬂuence, monarchs made ad-hoc bilateral deals with narrow town oligarchies

I Narrow elites in towns provided fertile ground for patronage ⇒ absolutism

Can explain institutional divergence b/w England and Continent

⇒ Self-governance in the hands of broad local elites with a venue to coordinate (parliament) ⇒ constraints on monarchs

Cross-country comparison

Conclusion – European Comparison Continental Europe: Similarities with England

I Town autonomy emerged during Commercial Revolution (e.g., fueros in Spain, commune in France)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 I Narrow elites in towns provided fertile ground for patronage ⇒ absolutism

Can explain institutional divergence b/w England and Continent

⇒ Self-governance in the hands of broad local elites with a venue to coordinate (parliament) ⇒ constraints on monarchs

Cross-country comparison

Conclusion – European Comparison Continental Europe: Similarities with England

I Town autonomy emerged during Commercial Revolution (e.g., fueros in Spain, commune in France) Continental Europe: Differences to England

I Continental monarchs were initially weaker vis-à-vis lords ⇒ fragmented jurisdictions

I To expand their inﬂuence, monarchs made ad-hoc bilateral deals with narrow town oligarchies

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 Can explain institutional divergence b/w England and Continent

⇒ Self-governance in the hands of broad local elites with a venue to coordinate (parliament) ⇒ constraints on monarchs

Cross-country comparison

Conclusion – European Comparison Continental Europe: Similarities with England

I Town autonomy emerged during Commercial Revolution (e.g., fueros in Spain, commune in France) Continental Europe: Differences to England

I Continental monarchs were initially weaker vis-à-vis lords ⇒ fragmented jurisdictions

I To expand their inﬂuence, monarchs made ad-hoc bilateral deals with narrow town oligarchies

I Narrow elites in towns provided fertile ground for patronage ⇒ absolutism

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 ⇒ Self-governance in the hands of broad local elites with a venue to coordinate (parliament) ⇒ constraints on monarchs

Cross-country comparison

Conclusion – European Comparison Continental Europe: Similarities with England

I Town autonomy emerged during Commercial Revolution (e.g., fueros in Spain, commune in France) Continental Europe: Differences to England

I Continental monarchs were initially weaker vis-à-vis lords ⇒ fragmented jurisdictions

I To expand their inﬂuence, monarchs made ad-hoc bilateral deals with narrow town oligarchies

I Narrow elites in towns provided fertile ground for patronage ⇒ absolutism

Can explain institutional divergence b/w England and Continent

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 Conclusion – European Comparison Continental Europe: Similarities with England

I Town autonomy emerged during Commercial Revolution (e.g., fueros in Spain, commune in France) Continental Europe: Differences to England

I Continental monarchs were initially weaker vis-à-vis lords ⇒ fragmented jurisdictions

I To expand their inﬂuence, monarchs made ad-hoc bilateral deals with narrow town oligarchies

I Narrow elites in towns provided fertile ground for patronage ⇒ absolutism

Can explain institutional divergence b/w England and Continent

⇒ Self-governance in the hands of broad local elites with a venue to coordinate (parliament) ⇒ constraints on monarchs

Cross-country comparison

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 BACKUP

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 2 / 46 Coalition of Power Holders in 1215 Magna Carta

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 3 / 46 Coalition of Power Holders in 1295 Model Parliament

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 4 / 46 Back to Talk 1/1

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 5 / 46 Farm Grants and External Wars

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 6 / 46 Extraordinary Taxation, Complaints about Ofﬁcials, and Charters of Liberties

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 7 / 46 Data Source: Royal Rolls

Entry for the farm grant of Bristol, 1224

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 8 / 46 Robin Hood: Typically seen as contemporary of king Richard I “Lionheart” (1157-99) Driven to outlawry during period of misrule in England while Richard I was away at the Third Crusade (1189-92) Greatest enemy: sheriff of Nottingham

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Corrupt tax collectors: “Sheriffs and reeves, whose ofﬁce was justice and judgment, were more terrible than thieves and plunderers, and more savage than the most savage.” [Henry of Huntingdon (ca. 1088-1154), in Bisson (2009), p. 178.]

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 9 / 46 Corrupt tax collectors: “Sheriffs and reeves, whose ofﬁce was justice and judgment, were more terrible than thieves and plunderers, and more savage than the most savage.” [Henry of Huntingdon (ca. 1088-1154), in Bisson (2009), p. 178.]

Robin Hood: Typically seen as contemporary of king Richard I “Lionheart” (1157-99) Driven to outlawry during period of misrule in England while Richard I was away at the Third Crusade (1189-92) Greatest enemy: sheriff of Nottingham

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 9 / 46 The Commercial Revolution

Rapid growth of commercial activity starting in 12C

I 136 markets exist in 1086 I More than 1000 new markets and 150 fairs created by 1348 (Lopez 1976, Britnell 1981, Masschaele 1997) Local administration (tax collection) grew in size; taxation of movables became central Surge of complaints about extortions by public ofﬁcials

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 10 / 46 Statute of Merchants (1285) states that: (i) speedy justice is needed to support trade (ii) the sheriffs meant to provide it abused their position (iii) justice to merchants is therefore the responsibility of mayors elected by burgesses

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 11 / 46 Without farm grant: Sheriff farms the borough: offers a ﬁxed amount (customary farm + increment) to the king for the right to collect variable dues Sheriff appoints the borough administration: bailiff (who also runs the borough court), constable, market viewer, ale-taster, etc.), who run courts, markets, and tax collection With farm grant: Burgesses appoint borough administration Tax the same items and pay the agreed-upon farm to the king

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 12 / 46 With farm grant: Burgesses appoint borough administration Tax the same items and pay the agreed-upon farm to the king

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The farm of the borough was composed of: Taxes on trade (merchandise was taxed at town gates and within markets whenever there was a transaction) The gable (the rent for the “burgage tenement” – the piece of land owned by the burgess) Profits from jurisdiction (fines and amercements imposed in courts) Without farm grant: Sheriff farms the borough: offers a fixed amount (customary farm + increment) to the king for the right to collect variable dues Sheriff appoints the borough administration: bailiff (who also runs the borough court), constable, market viewer, ale-taster, etc.), who run courts, markets, and tax collection

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 12 / 46 The farm of the borough was composed of: Taxes on trade (merchandise was taxed at town gates and within markets whenever there was a transaction) The gable (the rent for the “burgage tenement” – the piece of land owned by the burgess) Profits from jurisdiction (fines and amercements imposed in courts) Without farm grant: Sheriff farms the borough: offers a fixed amount (customary farm + increment) to the king for the right to collect variable dues Sheriff appoints the borough administration: bailiff (who also runs the borough court), constable, market viewer, ale-taster, etc.), who run courts, markets, and tax collection With farm grant: Burgesses appoint borough administration Tax the same items and pay the agreed-upon farm to the king

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 12 / 46 Brexit and the Norman Conquest Nigel Farage, leader of the Brexit Party

Section of the Bayeux Tapestry showing the death of King Harold in 1066

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 13 / 46 England Before the Norman Conquest

No self-governance of cities/boroughs (Maitland 1921) “To trace an institution beyond the Norman Conquest is to ﬁnd oneself in an atmosphere of dimmer conceptions and less well-deﬁned boundaries than prevailed afterwards” (Tait, 1964) No distinction between royal land (terra regis) and mesne land (terra baronum) Arrangement for collecting taxes: 2/3 for king and 1/3 for earl → earl’s “third penny”

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 14 / 46 I Widespread complaints about local ofﬁcials (especially sheriffs)

F “Sheriffs and reeves, whose ofﬁce was justice and judgment, were more terrible than thieves and plunderers, and more savage than the most savage.” [Henry of Huntingdon (ca. 1088-1154)

Asymmetric information: Frequent replacement of royal ofﬁcials ⇒ lack local knowledge.

I Distortion of local economy, especially with onset of the Commercial Revolution

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Inefﬁciencies in Tax Collection

Monitoring Problems: Hard to keep tax collectors in check (especially when king absent during wars)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 15 / 46 Asymmetric information: Frequent replacement of royal ofﬁcials ⇒ lack local knowledge.

I Distortion of local economy, especially with onset of the Commercial Revolution

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Inefﬁciencies in Tax Collection

Monitoring Problems: Hard to keep tax collectors in check (especially when king absent during wars)

I Widespread complaints about local ofﬁcials (especially sheriffs)

F “Sheriffs and reeves, whose ofﬁce was justice and judgment, were more terrible than thieves and plunderers, and more savage than the most savage.” [Henry of Huntingdon (ca. 1088-1154)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 15 / 46 Inefﬁciencies in Tax Collection

Monitoring Problems: Hard to keep tax collectors in check (especially when king absent during wars)

I Widespread complaints about local ofﬁcials (especially sheriffs)

F “Sheriffs and reeves, whose ofﬁce was justice and judgment, were more terrible than thieves and plunderers, and more savage than the most savage.” [Henry of Huntingdon (ca. 1088-1154)

Asymmetric information: Frequent replacement of royal ofﬁcials ⇒ lack local knowledge.

I Distortion of local economy, especially with onset of the Commercial Revolution

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 15 / 46 Andover’s Charter of 1205

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 16 / 46 Andover’s Charter of 1205

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 16 / 46 Beneﬁts of Farm Grants to Local Merchants

Bristol’s petition to the King in 1283: “Since none can know so well as those whose work is con- cerned with merchandise...how to regulate the affairs of merchants properly and honestly, the Commonalty of Bristol en- treats the Lord King that, if he should wish to grant his town at farm to anyone, he should concede it to them, since they would be prepared to give as much for it as any outsider. For an outside farmer would not seek it except for his own personal gain, which would be to the serious loss of the Commonalty. And the Commonalty seeks it to farm, not for the sake of proﬁt, but to safeguard, according to the law merchant, both themselves and others coming there.” (Cronne, 1946, pp. 42–3).

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 17 / 46 Charter of Ipswich / Ipswich Dom-Bok of 1281

On Thursday following the festival of the Nativity of St.John the Baptist in the second year of the reign of King John [29 June], the whole town of the borough of Ipswich gathered in the churchyard of St. Mary at Tower to elect two bailiffs and four coroners for the town, according to the speciﬁcations of the charter of the aforesaid lord King, which that king recently granted to the the borough. On which day the burgesses, by common assent and with one voice, elected two upright and law-abiding men [probos et legales homines] of their town, viz., John ﬁtz Norman and William de Beaumes, who were sworn to the administration of the ballivalty of the town and that they shall behave well and faithfully to both poor and rich.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 18 / 46 Ipswich’s Charter of 1200

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 19 / 46 Data on 554 English boroughs For each borough, we record:

I Ownership (royal vs mesne), geography (rivers, roads, seacost). I Date and extent of liberties. I Commercial Importance (e.g., lay subsidy). Sources:

I Foundation years: Beresford and Finberg (1973), Letters et al. (2003). I Medieval Geography (navigable rivers): Edwards and Hindle (1976), Jones (2000), Langdon (2014). I Ownership and Liberties: digitized version of original medieval documents (e.g., Pipe Rolls, Charter Rolls, Fine Rolls, Close Rolls, and Patent Rolls). Also, Ballard (1913), Ballard and Tait (1923). Summary statistics:

I Out of the 554 boroughs in existence by 1348: 145 were royal, or have been under royal control for an extensive period of time. I As of 1348, 90 boroughs obtained Farm Grants

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 20 / 46 Taxable Wealth in 1086, by Borough Ownership

Evidence from Domesday Book (1086)

All boroughs with available data (354 obs) .08 .06

Royal boroughs (85 obs)

.04 Mesne boroughs (269 obs) Kernel density .02 0 0 50 100 150 Taxable Wealth in 1086

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 21 / 46 Balancedness of Royal vs Mesne Boroughs

Raw Data Values after Entropy Balancing‡ Panel A: Trade-related geographic features of boroughs Royal Boroughs Mesne Boroughs p-value for Mean for Mean for p-value for boroughs with data: (overall 145) (overall 409) difference Royal Boroughs Mesne Boroughs difference #boroughs share #boroughs share in share in share Navigable River 45 31.0% 52 12.7% <0.001 31.0% 30.7% 0.95 Sea Coast 37 25.5% 84 20.5% 0.230 25.5% 25.5% 0.99 Roman Road 67 46.2% 116 28.4% 0.001 46.2% 45.8% 0.93 Panel B: Taxable wealth of boroughs in 1086 (Domesday book data) Royal Boroughs Mesne Boroughs p-value for Mean for Mean for p-value for boroughs with data: (overall 85) (overall 269) difference Royal Boroughs Mesne Boroughs difference ln(taxable wealth in 1086) 1.885 1.622 0.098 1.885 1.884 0.995

‡ Entropy balancing creates balanced samples by reweighing the observations in mesne boroughs to match the mean and variance of covariates in royal boroughs. In panel A, these ‘covariates’ are all three geographic variables jointly; in Panel B, taxable wealth only. See Hainmueller and Xu (2013) for details.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 22 / 46 All Boroughs in the Dataset. Royal and Mesne

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 23 / 46 Boroughs with Farm Grants (by Ownership)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 24 / 46 Enfranchised Boroughs (by Ownership)

Legend Boroughs Mesne Royal Transport Roman Roads Navigable Rivers

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 25 / 46 More Evidence on Commercial Importance of Boroughs with Farm Grants Boroughs with Farm Grants were commercially more important in 14C

Dependent Variable: As indicated in table header (1) (2) (3) (4) (5) (6) Dependent Variable: Freedom from Tolls by 1348† Commercial Hub in 14C‡ Boroughs included: all all royal all all royal Farm Grant 1348 0.531∗∗∗ 0.543∗∗∗ 0.533∗∗∗ 0.381∗∗∗ 0.382∗∗∗ 0.417∗∗∗ (0.052) (0.051) (0.070) (0.053) (0.053) (0.065) County FE XX Soil Quality XX Mean Dep. Var. 0.22 0.22 0.46 0.09 0.09 0.27 R2 0.22 0.33 0.29 0.24 0.29 0.22 Observations 554 554 145 554 554 145

Note: The table shows that boroughs with Farm Grants were commercially more important in the 14th century, using the two indicators explained below. All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † Indicator variable for “Freedom from tolls” – a grant of liberty that exempted a borough’s burgesses from tolls (taxes on trade). ‡ Indicator variable for whether a borough was a commercial hub during the 14th century, based on Masschaele (1997). Criteria include the presence of merchant guilds, the classiﬁcation as “urban” in the 1340 Nonae Rolls tax records, and the total tax on tradable goods levied in 1334.

Comm. Importance Detail Back to Talk 1/1

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 26 / 46 Self-governance and Commercial Importance Boroughs’ commercial importance by mid-14th century (Masschaele 1997) Masschaele considers:

I presence of merchant guild; I representation in Parliament under Edward I; I “urban” community in Nonae Rolls tax records in 1340; I “city” or “borough” in Nomina Villorum military census 1316.

Index for Commercial Importance in mid-14C: 4 if borough satisfies at least 4 criteria, and pays at least £120 in lay subsidy in 1334 3 if borough satisfies at least 4 criteria, and pays less than £120 in lay subsidy in 1334 2 if borough satisfies 3 criteria 1 if borough satisfies fewer than 3 criteria

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 27 / 46 Farm Grants: Role of Royal Boroughs Royal Boroughs were signiﬁcantly more likely to receive Farm Grants

Dependent variable: Indicator for boroughs that obtained Farm Grants by 1348 (1) (2) (3) (4) (5) (6) (7) (8) (9) Boroughs included: — all boroughs — — boroughs with data on Taxable Wealth in 1086 — Notes: Taxable Balancing Royal and Mesne Boroughs by: Wealth in Taxable Wealth Wealth and Trade Geography 10-90 pctile E-weights‡ PS Matching† E-weights‡ PS Matching† Royal borough 0.471∗∗∗ 0.469∗∗∗ 0.475∗∗∗ 0.450∗∗∗ 0.417∗∗∗ 0.456∗∗∗ 0.469∗∗∗ 0.465∗∗∗ 0.459∗∗∗ (0.043) (0.043) (0.045) (0.055) (0.060) (0.054) (0.060) (0.055) (0.065) Soil suitability 0.009 0.017 (0.013) (0.016) ln(Taxable wealth in 1086) 0.044∗∗∗ 0.026 0.068∗∗∗ [mv] 0.061∗∗∗ [mv] (0.013) (0.020) (0.020) (0.020) Pre-Norman Kingdom FE X p-value for kingdoms [0.66] County FE X Mean Dep. Var. 0.16 0.16 0.16 0.16 0.14 0.28 0.16 0.27 0.16 R2 0.32 0.32 0.37 0.32 0.27 0.30 0.30 Observations 554 554 554 354 296 354 354 354 354

Note: Regarding ﬁxed effects (FE): There are 39 counties, and 4 pre-Norman kingdoms: Wessex, Mercia, Northumbria, and East- Anglia. ‡ Entropy balancing reweights the observations in mesne boroughs to match the mean and variance of ln(Taxable Wealth) as well as the three trade geography indicators. See Hainmueller and Xu (2013) for detail. † Propensity score matching with one nearest neighbor. Matching variable is taxable indicated by “mv”. Back to Talk 1/1

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 28 / 46 Size of Lords’ Territory and Farm Grants Boroughs owned by lords with larger territory are more likely to receive charters

Share of boroughs with Farm Grants in 1348 95% CI .5 .4 .3 Share .2 .1 0

1 2 3 4 Lord Territory Size Territory sizes: 1=seigneur/abbot/nunnery 2=bishop 3=earl/archbishop 4=king

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 29 / 46 Difference-in-Differences Illustration

Boroughs without Trade Geography Boroughs with Trade Geography

1 Royal Boroughs 1 Royal Boroughs Mesne Boroughs 95% CI .9 Mesne Boroughs .9 95% CI p-value for p-value for .8 p-value for .8 difference: <0.001 difference: <0.001 difference: 0.608 p-value for .7 .7 difference: 0.094 .6 .6 p-value for difference: 0.522 .5 .5

p-value for .4 p-value for difference: 0.449 .4 difference: 0.624 .3 p-value for .3 difference: 0.507 .2 .2 Wealth rel. to Median / Share Wealth rel. to Median / Share .1 .1 0 0

Taxable Wealth* Farm Grants Enfranchised Enfranchised Taxable Wealth* Farm Grants Enfranchised Enfranchised (exclude FG Boroughs) (exclude FG Boroughs)

Note: The ﬁgure illustrates our difference-in-difference design (royal vs. mesne and trade vs. non-trade boroughs). To avoid that differences in wealth may confound this analysis, we exclude relatively wealthy and very poor boroughs. The left panel of the ﬁgure uses only the subset of boroughs without trade-favoring geography (i.e., boroughs without access to a navigable river, the sea coast, or an ancient Roman road – overall 74 boroughs); the right panel uses only boroughs with trade-favoring geography (overall 81 boroughs). ∗ Taxable wealth is normalized, relative to the median across all boroughs with available data on taxable wealth in 1086.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 30 / 46 Sample Splits by Status as Domesday Borough

Dependent variable: Indicator for borough enfranchised by 1348 (1) (2) (3) (4) (5) (6) Boroughs included: All Domesday non-Domes- non-Domesday Royal Boroughs and Boroughs Boroughs day Boroughs Domesday Mesne Boroughs Notes: Reduced Form for: Royal Mesne Farm Grant 1348 0.466∗∗∗ 0.401∗∗∗ 0.428∗∗∗ 0.545∗∗∗ (0.063) (0.114) (0.076) (0.092) Royal borough 0.154∗∗∗ 0.204 0.037 -0.235∗∗∗ (0.050) (0.127) (0.047) (0.082) Trade Geography Dummy 0.203∗∗ -0.057 (0.099) (0.157) Mean Dep. Var. 0.23 0.58 0.15 0.31 0.31 0.32 R2 0.26 0.30 0.16 0.22 0.04 0.00 Observations 554 106 448 127 83 44 Royal boroughs 145 62 83 83 83 Mesne boroughs 409 44 365 44 44 Farm Grant boroughs 90 39 51 35 35 0

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 31 / 46 Sample Splits by Status as Domesday Borough

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 31 / 46 Balancedness of Royal vs. Mesne Boroughs in Cols 4-6 of Above Table

Royal Boroughs Mesne Boroughs p-value for Excluding Domesday Only Domesday difference (overall 83) (overall 44) Charters of liberties (share) Farm Grants 42.2% 0.0% <0.001 Other liberties‡ 46.9% 40.9% 0.516 Enfranchisement (share) Among all boroughs 31.3% 31.8% 0.955 Among Farm Grant boroughs 62.9% [none] – Trade Geography (shares): Any Trade Geography 66.3% 68.2% 0.829 Navigable River 25.3% 20.5% 0.544 Sea Coast 27.7% 25.0% 0.745 Roman Road 32.5% 31.8% 0.936

Note: The table shows balancedness in royal vs. mesne boroughs for the subsample that uses only non-Domesday royal boroughs and only Domesday mesne boroughs.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 32 / 46 Balancedness of Royal vs. Mesne Boroughs in Cols 4-6 of Above Table

Note: The table shows balancedness in royal vs. mesne boroughs for the subsample that uses only non-Domesday royal boroughs and only Domesday mesne boroughs.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 32 / 46 Balancedness of Royal vs. Mesne Boroughs in Cols 4-6 of Above Table

Note: The table shows balancedness in royal vs. mesne boroughs for the subsample that uses only non-Domesday royal boroughs and only Domesday mesne boroughs.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 32 / 46 Trade Geography and Economic Outcomes Boroughs at locations that favored trade had higher taxable wealth, were commercially more importance in the 14th century, and had larger population by 1832

Dependent variable: As indicated in table header (1) (2) (3) (4) (5) (6) (7) (8) Dependent Variable: ln(Taxable Wealth 1086) Commercial Importance 14C† ln(Tax payers 1377) ln(population mid-17C) Boroughs included: royal mesne royal mesne royal mesne royal mesne Navigable River 1.189∗∗∗ 0.575∗∗∗ 1.068∗∗∗ 0.274∗∗ 1.558∗∗∗ 1.316∗∗∗ 0.920∗∗∗ 0.487∗∗∗ (0.344) (0.211) (0.254) (0.122) (0.332) (0.319) (0.248) (0.136) Sea Coast 0.105 -0.590∗∗∗ 0.902∗∗∗ 0.186∗∗ 0.620∗ -0.086 0.175 -0.101 (0.297) (0.217) (0.250) (0.085) (0.335) (0.196) (0.246) (0.108) Roman Road 0.203 0.153 0.721∗∗∗ -0.016 0.248 0.304 0.465∗∗ 0.210∗∗ (0.258) (0.157) (0.215) (0.059) (0.304) (0.232) (0.186) (0.096) p-value: joint signiﬁcance [0.006] [0.003] [<0.001] [0.029] [<0.001] [<0.001] [<0.001] [<0.001] River, Coast, Road Mean Dep. Var. 1.88 1.62 0.79 -0.28 6.29 5.60 7.19 6.75 R2 0.17 0.05 0.22 0.05 0.36 0.18 0.17 0.07 Observations 85 269 145 409 54 103 126 279

Notes: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † First principle component of two indicators for commercial importance: “Freedom from tolls” (a grant of liberty that exempted a borough’s burgesses from tolls throughout the realm) and an indicator variable for whether a borough was a commercial hub during the 14th century, based on Masschaele (1997). Back to Talk Back to Table Parliament

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 33 / 46 Taxable Wealth in 1086: Different Samples

Sample 1: Sample 2: All boroughs with data on wealth in 1086 Only boroughs in 10–90 percentiles of wealth .3 .4 Royal boroughs (72 obs) Mesne boroughs (224 obs) .2 .3

Royal boroughs (85 obs) Mesne boroughs (269 obs) Kernel density .1 Kernel density .2

0 p-value for difference in ln(wealth): 0.098

.1 p-value for difference in ln(wealth): 0.685 -2 -1 0 1 2 3 4 5 ln(Taxable Wealth in 1086) -2 -1 0 1 2 3 4 5 ln(Taxable Wealth in 1086) Sample 3: Sample 4: Only boroughs in 10–50 percentiles of Bottom 50 pctile royal and top 50 pctile wealth mesne .6 .5 .4 .5 .3 .4 .2 Kernel density Kernel density .3

Royal boroughs (37 obs) .1 Royal boroughs (43 obs) Mesne boroughs (118 obs) Mesne boroughs (131 obs)

p-value for difference in ln(wealth): 0.368 p-value for difference in ln(wealth): <0.001 0 .2 -2 -1 0 1 2 3 4 5 -2 -1 0 1 2 3 4 5 ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 34 / 46 Coefﬁcients on Farm Grants in the 4 Samples

.8 Coefficient 95% CI .7 .6 .5 .4 .3 Coeff. on Farm Grant .2 .1 0

Sample 1 Sample 2 Sample 3 Sample 4

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 35 / 46 Reduced-Form Coefﬁcients in the 4 Samples Coefﬁcients and CIs for an indicator for ‘any trade geography’

.8 Royal Boroughs Mesne Boroughs .7 95% CI .6 .5 .4 .3 .2 .1 Coeff. on Trade Geography 0

Sample 1 Sample 2 Sample 3 Sample 4

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 36 / 46 Background: Early vs. Late Enfranchisement Farm Grant boroughs were more likely to be enfranchised early. Later, the king enfranchised non-autonomous boroughs

Before 1348 1349-1700

600 All (initially not enfranchised) boroughs Enfranchised by end of period 500 400 300 Number of boroughs 200 100 0 All Farm G. No Farm G. All Farm G. No Farm G. Boroughs included

Strategic Enfranchisement Back to talk

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 37 / 46 Strategic Enfranchisement and Rotten Boroughs Boroughs enfranchised after 1348 were much more likely to become “rotten boroughs”

Rotten Boroughs: two seats in Parliament, but very small electorate that was controlled by patron Old Sarum

Enfranchised before 1348 Enfranchised after 1348 120 All enfranchised boroughs

100 Rotten boroughs 80 60 40 Number of enfranchised boroughs 20 0 All Farm G. No Farm G. All Farm G. No Farm G. Enfranchised boroughs included

Quote Boroughs in Cornwall Back to talk 1/1

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 38 / 46 “[...] mainly because consent to taxes was required, the Crown summoned

both knights for the shires and burgesses and citizens for the towns; that is to say, the concept of communities of the realm was extended beyond the administrative divisions [i.e., the shires] to the embedded lesser units [i.e., the boroughs]. Both shires and towns were, in fact, real communities in the sense that they had self-consciousness, self-government, and self-purpose; and the composition of the House of Commons in the later middle ages quite exceptionally reﬂected the reality.” [Elton 1974, p. 41]

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Farm Grants and the development of parliament

Farm Grants made boroughs “areas locally within but administratively outside the counties” [Tait 1936, p. 346] “The separate representation of cities and

boroughs was, no doubt, due to the varying degrees of immunity from the jurisdiction of the shire courts which they enjoyed.” [Pollard 1920, p. 112]

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 39 / 46 Farm Grants and the development of parliament

Farm Grants made boroughs “areas locally within but administratively outside the counties” [Tait 1936, p. 346] “The separate representation of cities and

boroughs was, no doubt, due to the varying degrees of immunity from the jurisdiction of the shire courts which they enjoyed.” [Pollard 1920, p. 112] “[...] mainly because consent to taxes was required, the Crown summoned

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 39 / 46 Old Sarum – A Rotten Borough

Uninhabited hill from 17th century 2 seats in Parliament 1295-1832 Served as ‘pocket borough’ for the Pitt family Sold to Earl of Caledon in 1802

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 40 / 46 Enfranchisement of Boroughs in Cornwall

“Nothing except the desire of the Crown [...] to control the House of Commons [...] could account for the enfranchisement of such Cornish boroughs as Newport, Saltash, Camelford, West Looe, Grampound, Bossiney and St. Michaels. Until the reign of Edward VI (1537-1553), Corn- wall had not been over-represented. [...] it was in the reign of Edward VI that Cornwall ﬁrst began to attain notoriety as a county of many boroughs. It owed this notoriety to the fact that it was a royal duchy, a county over which the Crown exer- cised more direct control than over most of the other counties of England.” (Porritt, 1909; p. 373-74)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 41 / 46 Background on the English Parliament

Model Parliament summoned by Edward I in 1295. ca. 100 boroughs send representatives

I Enfranchised boroughs return two MPs (5 boroughs return one MP)

I Enfranchisement is “customary”: boroughs that let their franchise expire, can claim right to re-enfranchisement

I Parliament discusses extraordinary taxation on movable wealth

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 42 / 46 Matching by Wealth and Population

Dependent variable: Indicator for borough enfranchised in Parliament by 1348 (1) (2) (3) (4) (5) (6) Matching based on: Taxable Wealth in 1086 Taxpayers in 1377 ‘Treated’ boroughs:† All FG Royal FG Royal FG All FG Royal FG Royal FG Matched (‘control’) boroughs:‡ All non-FG Mesne non-FG Royal non-FG All non-FG Mesne non-FG Royal non-FG Panel A: Matching using the full sample with available data Farm Grant 1349 0.570∗∗∗ 0.633∗∗∗ 0.572∗∗∗ 0.475∗∗∗ 0.594∗∗∗ 0.611∗ (0.069) (0.084) (0.123) (0.087) (0.064) (0.337) Observations 354 300 85 157 128 54 Farm Grant boroughs 55 43 43 41 33 33 Control boroughs 299 257 42 116 95 21 Panel B: Trimmed sample – see ﬁgure on next slide for distributions Farm Grant 1349 0.554∗∗∗ 0.620∗∗∗ 0.542∗∗∗ 0.483∗∗∗ 0.607∗∗∗ 0.286∗ (0.067) (0.085) (0.115) (0.086) (0.061) (0.154) Observations 330 277 75 148 122 28 Farm Grant boroughs 52 40 34 36 29 9 Control boroughs 282 237 41 112 93 19

Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. † In cols 1 and 4, ‘treatment’ observations are all (royal and mesne) Farm Grant boroughs; in all other columns, ‘treated’ observations are only royal boroughs with Farm Grants (FG). ‡ ‘Control’ observations include the following boroughs: in cols 1 and 4 all boroughs without Farm Grants (FG); in cols 2 and 5 all mesne boroughs without FG; in cols 3 and 6 all royal boroughs without FG.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 43 / 46 Matching by Wealth and Population – Distributions for Farm Grant and Control Boroughs

Column 1 Column 2 Column 3 .4 .35 .3 .3 .3 .2 .25 Farm Grant (FG) boroughs Royal FG boroughs Royal FG boroughs Matched non-FG boroughs .2 Matched mesne non-FG boroughs Matched royal non-FG boroughs .2 Kernel density Kernel density Kernel density .1 .1 .15

0 log-point difference in wealth in 1086: 0.009 (p-value: 0.198) 0 log-point difference in wealth in 1086: 0.008 (p-value: 0.485) .1 log-point difference in wealth in 1086: 0.006 (p-value: 0.729) 0 1 2 3 4 5 0 1 2 3 4 5 0 1 2 3 ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086)

Column 4 Column 5 Column 6 .4 .4 .5 .4 .3 .3 .3 .2 .2 .2 Kernel density Kernel density Kernel density .1 .1

Farm Grant (FG) boroughs Royal FG boroughs .1 Royal FG boroughs Matched non-FG boroughs Matched mesne non-FG boroughs Matched royal non-FG boroughs

0 log-point difference in tax payers in 1377: 0.002 (p-value: 0.901) 0 log-point difference in tax payers in 1377: -.011 (p-value: 0.815) 0 log-point difference in tax payers in 1377: 0.032 (p-value: 0.611) 4 5 6 7 8 4 5 6 7 8 4 4.5 5 5.5 6 6.5 ln(Tax Payers in 1377) ln(Tax Payers in 1377) ln(Tax Payers in 1377)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 44 / 46 Matching with Same Trade Geography – Results Results hold when matching by wealth and exactly the same trade geography

Dependent variable: Indicator for borough enfranchised in Parliament by 1348 (1) (2) (3) (4) (5) (6) Matching based on: Taxable Wealth in 1086, trimmed sample with further restrictions: Only boroughs with: Any Trade Navigable Sea Roman Freedom Freedom from Tolls Geography River Coast Road from Tolls & Trade Geography Farm Grant 1349 0.650∗∗∗ 0.549∗∗∗ 0.737∗∗∗ 0.784∗∗∗ 0.475∗∗∗ 0.440∗∗∗ (0.082) (0.183) (0.131) (0.078) (0.150) (0.166) Observations 145 41 38 88 44 36 Farm Grant boroughs (treated) 34 11 13 20 21 21 Control boroughs 111 30 25 68 23 16 Note: Estimates are from propensity score matching by wealth in 1086 with one nearest neighbor. Ro- bust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. ‘Treatment’ observations are royal boroughs with Farm Grants; ‘control’ observations include all mesne boroughs without Farm Grants. The sample is trimmed, excluding all mesne boroughs that have lower taxable wealth than the poorest Farm Grant borough, and excluding all Farm Grant boroughs with higher wealth than the wealthiest mesne borough. See ﬁgure on next slide for the corresponding distributions.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 45 / 46 Matching with Same Trade Geography – Wealth Distribution for Farm Grant and Control Boroughs

Column 1 Column 2 Column 3 .4 .5 .4 Royal FG boroughs Matched mesne non-FG boroughs .4 .3 .3 .3 Royal FG boroughs Royal FG boroughs .2 Matched mesne non-FG boroughs Matched mesne non-FG boroughs .2 Kernel density Kernel density Kernel density .2 .1 .1 0 0 log-point difference in wealth in 1086: -.006 (p-value: 0.691) .1 log-point difference in wealth in 1086: 0.015 (p-value: 0.671) log-point difference in wealth in 1086: -.077 (p-value: 0.15) 0 1 2 3 4 5 1 2 3 4 1 2 3 4 5 ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086)

Column 4 Column 5 Column 6 .4 .35 .4 .3 .3 .3 .25 Royal FG boroughs Royal FG boroughs Royal FG boroughs

.2 Matched mesne non-FG boroughs Matched mesne non-FG boroughs Matched mesne non-FG boroughs .2 Kernel density Kernel density Kernel density .2 .1 .15 .1

0 log-point difference in wealth in 1086: .015 (p-value: 0.546) log-point difference in wealth in 1086: -.025 (p-value: 0.592) .1 log-point difference in wealth in 1086: -.01 (p-value: 0.63) 0 1 2 3 4 0 1 2 3 4 0 1 2 3 4 ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086) ln(Taxable Wealth in 1086)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 46 / 46 Alternative Interpretation: Ability to Coordinate? Are our results driven by (unobserved) ability to coordinate / solve collective action problems?

Two proxies for ability to coordinate: Right to elect ofﬁcials (when obtained independent of Farm Grants) Right to collect taxes to pave streets or build/repair city walls (1200-1348) These additional rights were obtained by both royal and mesne towns

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 47 / 46 Proxies for Organizational Capacity: Right to Elect Ofﬁcials and Murage/Pavage Results hold when controlling for organizational capacity, and within subset of boroughs with proven organizational capacity

Dependent variable: Indicator for borough enfranchised by 1348 (1) (2) (3) (4) Boroughs included: all all only boroughs with separate rights to... elect local ofﬁcials Murage/Pavage ∗∗∗ ∗∗∗ ∗∗∗ ∗∗∗ D1: Farm Grant 1348 0.492 0.490 0.425 0.554 (0.063) (0.064) (0.135) (0.126) ∗∗∗ D2: Right to elect ofﬁcials / no Farm Grant 0.229 (0.073) ∗∗ D3: Murage or Pavage / no Farm Grant 0.158 (0.066) p-value for difference between D1 and D2/D3 0.004 <0.001 Royal borough 0.147∗∗∗ 0.146∗∗∗ 0.176 -0.011 (0.050) (0.051) (0.138) (0.131)

Number of boroughs with D1 = 1 90 90 50 49 Number of boroughs with D2/D3 = 1 45 55 Mean Dep. Var. 0.23 0.23 0.64 0.55 R2 0.28 0.27 0.34 0.30 Observations 554 554 95 104

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 48 / 46 Parliament – Additional Results Results also hold for ﬁrst Parliament in 1295 (‘Model Parliament’)

Dependent variable: Indicator for borough enfranchised in 1295 (1) (2) (3) (4) Boroughs included: Boroughs founded by 1295 all all royal mesne Farm Grant 1295 0.360∗∗∗ 0.365∗∗∗ (0.068) (0.067) Royal borough 0.135∗∗∗ 0.133∗∗∗ (0.050) (0.049) Navigable River 0.286∗∗∗ 0.020 (0.086) (0.056) Sea Coast 0.217∗∗ 0.052 (0.093) (0.052) Roman Road 0.348∗∗∗ -0.030 (0.078) (0.038) p-value joint signiﬁcance [0.000] [0.578] River, Coast, Road County FE X Terrain Controls X Mean Dep. Var. 0.21 0.21 0.42 0.12 R2 0.19 0.31 0.19 0.01 Observations 460 460 136 324

Note: All regressions are run at the borough level. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 49 / 46 In boroughs with early self-governance, merchant class was relatively large, powerful, and in control of the corporation.

I Merchant class was in power from the inception (and prior to Parliament).

Government bodies (mayor and council) had inﬂuence over MP choices and borough franchises (History of Parliament 2009 and Salmon 2005).

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Self-Governance and Borough Franchise

In principle, initially, all male burgesses should assemble and elect their MPs But over time, enfranchised boroughs became heterogeneous in the way they (s)elected their MPs...

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 50 / 46 Self-Governance and Borough Franchise

In principle, initially, all male burgesses should assemble and elect their MPs But over time, enfranchised boroughs became heterogeneous in the way they (s)elected their MPs... In boroughs with early self-governance, merchant class was relatively large, powerful, and in control of the corporation.

I Merchant class was in power from the inception (and prior to Parliament).

Government bodies (mayor and council) had inﬂuence over MP choices and borough franchises (History of Parliament 2009 and Salmon 2005).

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 50 / 46 Inﬂuence of the king at the time of incorporation: First appointment: king appoints ﬁrst members of the newly formed corporation’s governing body

I 1 mayor, 12 aldermen, 24 councilmen Co-Optation: initial council appointed subsequent council members ⇒ maintain closed governing bodies

I Boroughs with early self-governance less subject to co-optation (Webb and Webb 1963) Status quo until 1835.

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Independent Elections of Borough Ofﬁcials: 15-17C Starting in 15th century, boroughs evolve into corporations

I A corporation can own property and issue by-laws I Local government composed of mayor and aldermen/councilmen.

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 51 / 46 Independent Elections of Borough Ofﬁcials: 15-17C Starting in 15th century, boroughs evolve into corporations

I A corporation can own property and issue by-laws I Local government composed of mayor and aldermen/councilmen.

Inﬂuence of the king at the time of incorporation: First appointment: king appoints ﬁrst members of the newly formed corporation’s governing body

I 1 mayor, 12 aldermen, 24 councilmen Co-Optation: initial council appointed subsequent council members ⇒ maintain closed governing bodies

I Boroughs with early self-governance less subject to co-optation (Webb and Webb 1963) Status quo until 1835.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 51 / 46 Inclusiveness of MP Elections in 1830s

MP candidate openness (from 1 to 3): = 1 if both MPs chosen by patron, 2 if only one MP chosen by patron, and 3 if anyone could run for parliament (History of Parliament)

Contested Elections (from 0 to 4): the number of elections out of the last four for which at least one candidate stood a pole (History of Parliament)

Broad Franchise (0 or 1): = 0 if either corporation/burgage, or = 1 otherwise Detail

Patronage index (from 0 to 2): = 0 if Rotten borough and closed constituency (controlled by local patron), = 1 if either rotten or closed constituency, = 2 (open) if neither of the two

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 52 / 46 Inclusiveness of MP Elections at the Borough Level in the 1830s Medieval Farm Grants are a strong predictor of more open borough-level elections of MPs in the early 1830s

Dependent variables: Various indicators for openness of MP elections at the borough level in the 1820-31 (1) (2) (3) (4) (5) (6) (7) (8) (9) Dependent Variable: Openness Contested Broad Patronage — First Principal Component of (1) – (4) — Index Elections franchise index Notes: royal only 2SLS† Farm Grant 1348 0.385∗∗∗ 0.653∗∗∗ 0.190∗∗∗ 0.433∗∗∗ 0.671∗∗∗ 0.644∗∗∗ 0.521∗∗∗ 0.788∗∗∗ 0.828∗∗∗ (0.112) (0.206) (0.066) (0.099) (0.149) (0.147) (0.167) (0.200) (0.194) # Additional Controls XXXX County FE X Terrain Controls X R2 0.07 0.06 0.04 0.09 0.10 0.17 0.42 0.25 0.16 Observations 185 185 185 185 185 185 185 82 185 Mean Dep. Var.: 1.54 1.35 0.69 0.92 — [Principal Component: Mean 0, Std 1] —

‡ Additional controls include the following variables constructed by Aidt and Franck (2015): market integration (travel distance between any given constituency and the 243 other constituencies weighted by the population); Distance to urban center (travel days from each constituency to the nearest of the 13 largest towns in 1831); Connection to London (graphical, economic, and informational connections to London); a dummy for 13 boroughs controlled by the treasury.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 53 / 46 Types of Franchises in 1832

As of 1832, 6 types of franchises:

I Corporation (mayor, aldermen and councilmen can vote) I Burgage (right of voting attached to the tenancy of a house or property designated as a burgage plot for parliamentary elections) I Potwalloper (all inhabitants qualiﬁed by six months residence could vote, unless they were alms-men or paupers) I Scot and Lot (Inhabitants householders paying the (poor) rates are entitled to vote) I Freeholder (owners of freeholds (similar to a burgage plot, but of a less ancient origin) can vote) I Freemen (only freemen – those who enjoy the freedom of the borough, e.g., they can trade – can vote)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 54 / 46 Civil War of 1642-51: Background By 1630-41: “Personal Rule by Charles I”. Parliament not summoned Disastrous (military and religious) conﬂicts with Scotland and Ireland. Need to raise extra-ordinary taxes ⇒ King summons Parliament Parliament consents to new taxes subject to conditions:

I Redress of grievances (bishops, monopolies and customs farming) I New prerogatives (king cannot unilaterally dissolve parliament) King refuses to give in and conﬂict escalates: Long Parliament Parliament splits into Royalists and Parliamentarians

I Whole country divided; not a social class conﬂict I Boroughs mostly neutral out of fear for their liberties (Howell, 1982). April-August 1642: military escalation King relies on rural and county-level administration to raise army

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 55 / 46 Civil War – Reduced Form

Dep. Var.: Indicator for pro-Parliamentary volunteer troops raised by borough in 1642 (1) (2) (3) — Reduced Form — Boroughs included: royal mesne mesne Note: E-weights§ Navigable River 0.163∗∗ 0.016 0.011 (0.069) (0.028) (0.025) Sea Coast 0.027 0.015 0.030 (0.061) (0.021) (0.027) Roman Road 0.223∗∗∗ 0.004 -0.011 (0.061) (0.017) (0.018) p-value: joint signiﬁcance [<0.001] [0.880] [0.512] River, Coast, Road Mean Dep. Var. 0.14 0.02 0.03 R2 0.14 0.00 0.01 Observations 144 406 406

Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. §Entropy balancing reweighs the observations in mesne boroughs to match the mean and variance of navigable river, sea coast, and Roman road in royal boroughs.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 56 / 46 Dynamics of the Reform Act

Corruption in local governance and in elections of MPs a constant theme in 18th and 19th century (Webb and Webb 1963)

I Issue becomes more salient in 1820s

3 relevant general elections: 1826, 1830, April 1831

I Reform is marginal issue during 1826 election. Reform is important in 1830, but other 2 big issues (corn laws and slavery)

I Election in April 1831 is essentially referendum on the bill. (Most) Tories were against the reform. Radicals and Whigs were pro

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 57 / 46 2 Commitment to Public good provision:

I Population growth after industrialization ⇒ deteriorated public health and law and order (Webb and Webb 1963)

I Incentives to end pork-barrel politics and improve the provision of health and other public services (Lizzeri and Persico 2004)

3 Complementary Mechanisms:

I Social Unrest (Aidt and Franck 2015)

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Explanations for Support of the Great Reform Act

1 Change in the franchise rules affected boroughs with open and closed voting rights differently:

I Farm Grant boroughs ⇒ history of relatively open franchise: reform made franchise less vulnerable to manipulations I Boroughs with a narrow franchise: reform made patronage largely unfeasible

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 58 / 46 3 Complementary Mechanisms:

I Social Unrest (Aidt and Franck 2015)

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Explanations for Support of the Great Reform Act

1 Change in the franchise rules affected boroughs with open and closed voting rights differently:

I Farm Grant boroughs ⇒ history of relatively open franchise: reform made franchise less vulnerable to manipulations I Boroughs with a narrow franchise: reform made patronage largely unfeasible

2 Commitment to Public good provision:

I Population growth after industrialization ⇒ deteriorated public health and law and order (Webb and Webb 1963)

I Incentives to end pork-barrel politics and improve the provision of health and other public services (Lizzeri and Persico 2004)

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 58 / 46 Explanations for Support of the Great Reform Act

1 Change in the franchise rules affected boroughs with open and closed voting rights differently:

I Farm Grant boroughs ⇒ history of relatively open franchise: reform made franchise less vulnerable to manipulations I Boroughs with a narrow franchise: reform made patronage largely unfeasible

2 Commitment to Public good provision:

I Population growth after industrialization ⇒ deteriorated public health and law and order (Webb and Webb 1963)

I Incentives to end pork-barrel politics and improve the provision of health and other public services (Lizzeri and Persico 2004)

3 Complementary Mechanisms:

I Social Unrest (Aidt and Franck 2015)

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 58 / 46 Main Results: Clustering and Spatial Correlation

Dependent variable as indicated in table header (1) (2) (3) (4) (5) Dependent variable: Seat in Parlia- Inﬂuence of king on Volunteer troops Openness of MP Vote share for Great ment by 1348 local elections 15-17C during Civil War elections 1820-31‡ Reform Act 1832 Panel A: Main Results (OLS with robust standard errors) Farm Grant 1348 0.466∗∗∗ -0.222∗∗ 0.201∗∗∗ 0.674∗∗∗ 0.157∗∗ (0.063) (0.104) (0.045) (0.148) (0.070) R2 0.26 0.03 0.12 0.10 0.16 Observations 554 158 550 184 175 Panel B: Clustered Standard Errors (at the county level) Farm Grant 1348 0.466∗∗∗ -0.222∗∗ 0.201∗∗∗ 0.674∗∗∗ 0.157∗∗ (0.082) (0.098) (0.054) (0.126) (0.060) R2 0.26 0.03 0.12 0.10 0.16 Observations 554 158 550 184 175 Panel C: Accounting for Spatial Correlation Farm Grant 1348 0.466∗∗∗ -0.222∗∗ 0.201∗∗∗ 0.557∗∗∗ 0.162∗∗ (0.051) (0.101) (0.030) (0.135) (0.070) Observations 554 158 550 184 175

Note: The coefﬁcients in Panel C are estimated by maximum likelihood, using each borough’s geographic location to derive the weighting matrix. All boroughs with distance less than 2 degrees (220km)˜ are considered spatially contiguous and are assigned a nonzero spatial weight. Standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. ‡ First principle component of the four proxies for open MP elections.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 59 / 46 Main Results: Controlling for Taxable Wealth in 1086

Table: Main Results: Controlling for Taxable Wealth in 1086 Dependent variable as indicated in table header (1) (2) (3) (4) (5) Dependent variable: Seat in Parlia- Inﬂuence of king on Volunteer troops Openness of MP Vote share for Great ment by 1348 local elections 15-17C during Civil War elections 1820-31‡ Reform Act 1832 Panel A: All boroughs with data on taxable wealth Farm Grant 1348 0.405∗∗∗ -0.297∗∗ 0.198∗∗∗ 0.486∗∗ 0.153 (0.082) (0.120) (0.059) (0.190) (0.097) ln(Taxable wealth in 1086) 0.022 -0.072∗∗ 0.008 0.078 0.060 (0.018) (0.035) (0.011) (0.072) (0.036) R2 0.25 0.11 0.13 0.08 0.16 Observations 354 94 354 104 100 Panel B: Taxable wealth in 1086 between 10th and 90th percentile Farm Grant 1348 0.452∗∗∗ -0.269∗∗ 0.234∗∗∗ 0.396∗ 0.223∗∗ (0.089) (0.128) (0.069) (0.219) (0.106) ln(Taxable wealth in 1086) -0.006 -0.060 -0.003 0.120 0.104∗∗ (0.023) (0.061) (0.013) (0.099) (0.052) R2 0.27 0.07 0.17 0.06 0.24 Observations 296 74 296 82 79 Note: Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. ‡ First principle component of the four proxies for open MP elections.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 60 / 46 Long-Run Results: (Exact) Matching by Trade Geography

Note: The table replicates our main results, performing propensity score matching with one (exact) match. The ‘treatment group’ are royal boroughs with Farm Grants; the ‘control group’ are mesne boroughs (without Farm Grants) with the same trade geography as each ‘treated’ borough. Robust standard errors in parentheses. * p<0.1, ** p<0.05, *** p<0.01. ‡ First principle component of the four proxies for open MP elections.

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 61 / 46 France

I King in France (initially) much weaker than in England

I Rivalry between strong local lords ⇒ Localism

I Emergence of some town-level liberties, but more constrained Spain

I To ﬁnance the Reconquista, kings needed funding from powerful bourgeoisie

I Kings gave Fueros (grants of autonomy) to cities, and admitted their representatives to the Cortes

I But: weak king(s) and localism of lords ⇒ liberties more constrained than in England

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Cross-country comparison (France and Spain) Similarities to England

I Complaints about tax collectors, especially after Commercial Revolution

I General assemblies discuss extra-ordinary taxation

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 62 / 46 Spain

I To ﬁnance the Reconquista, kings needed funding from powerful bourgeoisie

I Kings gave Fueros (grants of autonomy) to cities, and admitted their representatives to the Cortes

I But: weak king(s) and localism of lords ⇒ liberties more constrained than in England

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Cross-country comparison (France and Spain) Similarities to England

I Complaints about tax collectors, especially after Commercial Revolution

I General assemblies discuss extra-ordinary taxation France

I King in France (initially) much weaker than in England

I Rivalry between strong local lords ⇒ Localism

I Emergence of some town-level liberties, but more constrained

Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 62 / 46 Cross-country comparison (France and Spain) Similarities to England

I Complaints about tax collectors, especially after Commercial Revolution

I General assemblies discuss extra-ordinary taxation France

I King in France (initially) much weaker than in England

I Rivalry between strong local lords ⇒ Localism

I Emergence of some town-level liberties, but more constrained Spain

I To ﬁnance the Reconquista, kings needed funding from powerful bourgeoisie

I Kings gave Fueros (grants of autonomy) to cities, and admitted their representatives to the Cortes

I But: weak king(s) and localism of lords ⇒ liberties more constrained than in England

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Angelucci, Meraglia, Voigtländer How Merchant Towns Shaped Parliaments Mar 3, 2020 62 / 46