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We examine the role of universities in knowledge production and industrial change using historical evidence. Political shocks led to a profound pro-science shift in German universities around 1800. To study the consequences, we construct novel microdata. We find that invention and manufacturing developed similarly in cities closer to and farther from universities in the 1700s and shifted towards universities and accelerated in the early 1800s. The shift in manufacturing was strongest in new and high knowledge industries. After 1800, the adoption of mechanized technology and the number and share of firms winning international awards for innovation were higher near universities.

We document how the Black Death activated politics and led to economic divergence within Europe. Before the pandemic, economic development was similar in Eastern and Western German cities despite greater political fragmentation in the West. The pandemic precipitated a divergence that coincided with prior differences in politics. After the pandemic, construction and manufacturing fell by 1/3 in the East relative to underlying trends and the Western path. Politics institutionalizing local self-government advanced in the West, but not in the East. This divergence is observed across otherwise similar cities along historic borders and foreshadows a subsequent divergence in agriculture.

We study the role of book content in economic, religious, and institutional development after the introduction of printing, and the role of competition in determining the amount and content of local printing. We focus on (1) business education content and (2) religious ideas during the Protestant Reformation. We construct data on printing output and competition in European cities 1454-1600.We document positive relationships between business education content and city growth, and Protestant content and institutional change. We find competition predicts content. We confirm the relationships between competition, content, and outcomes using printer deaths as a source of exogenous variation.

Using novel microdata, we document an important, unintended consequence of the Protestant Reformation: a reallocation of resources from religious to secular purposes. To understand this process, we propose a conceptual framework in which the introduction of religious competition shifts political markets where religious authorities provide legitimacy to rulers in exchange for control over resources. Consistent with our framework, religious competition changed the balance of power between secular and religious elites: secular authorities acquired enormous amounts of wealth from monasteries closed during the Reformation, particularly in Protestant regions. This transfer of resources had significant consequences. First, it shifted the allocation of upper-tail human capital. Graduates of Protestant universities increasingly took secular, especially administrative, occupations. Protestant university students increasingly studied secular subjects, especially degrees that prepared students for public sector jobs, rather than church sector-specific theology. Second, it affected the sectoral composition of fixed investment. Particularly in Protestant regions, new construction shifted from religious toward secular purposes, especially the building of palaces and administrative buildings, which reflected the increased wealth and power of secular lords. Reallocation was not driven by pre-existing economic or cultural differences. Our findings indicate that the Reformation played an important causal role in the secularization of the West.

What are the origins and consequences of the state as a provider of public goods? We study public goods provision established through new laws in German cities during the 1500s. Cities that adopted the laws subsequently began to differentially produce and attract human capital and to grow faster. Legal change occurred where ideological competition introduced by the Protestant Reformation interacted with local politics. We study plagues that shifted local politics in a narrow period as sources of exogenous variation in public goods institutions, and find support for a causal interpretation of the relationship between legal change, human capital, and growth.

The Protestant Reformation, beginning in 1517, was both a shock to the market for religion and a first-order economic shock. We study its impact on the allocation of resources between the religious and secular sectors in Germany, collecting data on the allocation of human and physical capital. While Protestant reformers aimed to elevate the role of religion, we find that the Reformation produced rapid economic secularization. The interaction between religious competition and political economy explains the shift in investments in human and fixed capital away from the religious sector. Large numbers of monasteries were expropriated during the Reformation, particularly in Protestant regions. This transfer of resources shifted the demand for labor between religious and secular sectors: graduates from Protestant universities increasingly entered secular occupations. Consistent with forward-looking behavior, students at Protestant universities shifted from the study of theology toward secular degrees. The appropriation of resources by secular rulers is also reflected in construction: during the Reformation, religious construction declined, particularly in Protestant regions, while secular construction increased, especially for administrative purposes. Reallocation was not driven by pre-existing economic or cultural differences.

What are the origins and consequences of the state as a provider of public goods? We study legal reforms that established mass public education and increased state capacity in German cities during the 1500s. These fundamental changes in public goods provision occurred where ideological competition during the Protestant Reformation interacted with popular politics at the local level. We document that cities that formalized public goods provision in the 1500s began differentially producing and attracting upper tail human capital and grew to be significantly larger in the long-run. We study plague outbreaks in a narrow time period as exogenous shocks to local politics and find support for a causal interpretation of the relationship between public goods institutions, human capital, and growth. More broadly, we provide evidence on the origins of state capacity directly targeting welfare improvement.

This research studies how variations in competition and in media content characterized the use and impact of Gutenberg's printing press technology during the European Renaissance. The research constructs annual firm-level panel data on the publications produced by 7,000+ printing firms operating in over 300 European cities 1454- 1600. Evidence on the timing of the premature deaths of firm owner-managers is used to isolate shocks to competition. Firms where owner-managers died experienced large negative shocks to output. However, at the citylevel deaths of incumbent managers were associated with significant increases in entrance and with a positive and persistent impact on competition and city output. Variations in city supply induced by heterogeneous manager deaths are used to study the relationship between the diffusion of ideas in print and city growth. A uniquely strong relationship is observed between the new business education literature and local growth. This is consistent with historical research on the transformative impact business education ideas had on commercial practices and European capitalism.

This research studies the role of competition in the diffusion of radical ideas and institutional change during the Protestant Reformation. We construct a new measure of religious content in the media using data on all known books and pamphlets printed in German-speaking Europe 1454-1600. We find that Protestant content was produced in greater quantity in local media markets with more competing firms when Martin Luther circulated his initial arguments for reform in 1517. We find that competition mattered differentially more for the diffusion of Protestant ideas and for institutional change where city governments had the least legal autonomy from feudal lords. We document the relationship between competition and diffusion directly and using the deaths of printers to isolate plausibly exogenous variation in competition. We show that cities where initial competition was greater, and which were more exposed to Protestant ideas, were more likely to adopt the legal institutions of the Reformation.

Gutenberg's printing press was the great revolution in Renaissance information technology. This paper presents new evidence on media markets, knowledge transmission, and city growth across Europe 1450-1600. The paper construct- s comprehensive firm-level panel data on the number and subjects of book titles printed each year by the 7,000+ printing firms operating in over 300 European cities 1450-1600. Information from historical books is used to identify the dates at which printers died prematurely and management control of their firms passed to widows or heirs. Firms where managers died prematurely experienced large nega- tive shocks to output. However, at the city-level manager deaths were associated with significant increases in (i) entrance and (ii) production by incumbent firms with product line specializations similar to that of the firm losing its manager. On net, manager deaths increased competition and city-level output. The variation in city-level supply induced by heterogeneous manager deaths is used to identify the impact of print media on city-level population growth. Local access to printed merchants' manuals used in business education was particularly associated with growth. New micro data on book prices document the inter-city trade costs that generated local spillovers.