CIE Seminar- Edoardo Teso (Northwestern University)

The Center for Economic Research (CIE) invites you to the seminar:
State Capacity as an Organizational Problem. Evidence from the Growth of the U.S. State Over 100 Years

Presented by: Edoardo Teso (Northwestern University)

The seminar will take place on October 27 from 12:00 to 13:30 p.m. in the Santa Teresa Seminar Room.

Abstract:

We study how the organization of the state evolves over the process of development of a nation, using a new dataset on the internal organization of the U.S. federal bureaucracy over 1817-1905. First, we show a series of facts, describing how the size of the state, its presence across the territory, and its key organizational features evolved over the nineteenth century.
Second, exploiting the staggered expansion of the railroad and telegraph networks across space, we show that the ability of politicians to monitor state agents throughout the territory is an
important driver of these facts: locations with lower transportation and communication costs with Washington DC have more state presence, are delegated more decision power, and have
lower employee turnover. The results suggest that high monitoring costs are associated with small, personalistic state organizations based on networks of trust; technological shocks lowering monitoring costs facilitate the emergence of modern bureaucratic states.