Agricultural Policy and Long-Run Development: Evidence from Mussolini's Battle for Grain

Abstract

Abstract This article explores the long-run effect of agricultural policies on industrialisation and economic development. I analyse the differential effect of the Battle for Grain, implemented by the Italian Fascist regime to achieve self-sufficiency in wheat, on the development path across areas of Italy. Employing cross-sectional variation in land suitability for advanced wheat production technologies, along with time variation in their diffusion, I find that the policy had unintended positive effects on industrialisation and economic prosperity, which have persisted until today. Furthermore, I find that the complementarity between human capital and agricultural technology was a critical mechanism.