Economic persistence in face of adversity: Evidence from Kyrgyz tribes through Soviet times

Abstract: We study the role of traditional institutions of tribes and clans – large groups of people sharing an identity based on common lineage – in determining long-run differences in economic trajectories at sub-national level. Using a combination of rich historical and contemporaneous data sources from Kyrgyzstan, we study the persistent influence of the tribal-clanic institutions on householdlevel economic outcomes over a long run, in the face of highly adverse government policies. Even after controlling for unobservable local effects, the economic well-being (measured with income and expenditures) of Kyrgyz households in 2012 strongly correlates with the early 20th-century average wealth measures of the tribes to which these households belong. Furthermore, the economic inequality among tribe members today correlates with the within-tribe wealth inequality in the early 20th century. In terms of channels of persistence, we find support for the inter-generational transmission of human capital/relative status, political power, and cultural traits. Transmission of material assets, differences in natural endowments, or geographic sorting cannot explain the observed long-run persistence.

Authors: Catherine Guirkinger, University of Namur, Gani Aldashev, Université libre de Bruxelles, Mate Fodor, New School of Economics, Satbayev University