Parliamentary Constraints and Long-Term Development: Evidence from the Duchy of Wurttemberg

Did parliamentary constraints foster economic activity or was activity the cause of constraints? This article addresses the first part of this question by examining the long-term effects of belonging to the Duchy of Wurttemberg wherein the parliament placed considerable checks on the various dukes from 1495 to 1796. I use a geographic natural experiment and compare areas just inside of the Duchy with adjacent areas outside of it. Economically similar prior to 1495, areas within the Duchy had a higher degree of urbanization and commercialization in the subsequent period. I provide further evidence that this difference reflects three mechanisms: local representation in parliament, improved local public-goods provision, and attraction of upper-tail human capital.