Essays on the Political Causes and Consequences of Technological Change

Abstract

This dissertation explores the political causes and consequences of technological change. In three essays, I show that new technology and trade shape states’ economies, politics, and relations with each other.

In "Does Globalization Bring Peace?" I leverage the ways steamships changed trade to explore whether more trade led to less war. In contrast to existing work stressing a commercial peace based on two countries’ mutual dependence specifically, I argue and provide causal evidence that more trade – with any partner – bring less war.

"Political Competition in Dynamic Economies" explores how economic possibilities shape politics, and politics shape economic allocations. I argue that if investment outcomes produce shifts in the economy which threaten leaders’ hold on power, they will intervene in the economy to protect their position, at a cost to investors and themselves. This induces an incentive for political outsiders to avoid investments with certain characteristics: those with high variance or unclear covariance, which are more likely to lead to intervention. Such economies will thus see both allocation loss – as these characteristics are prioritized at the expense of economic return – and costly intervention. In equilibrium, leaders balance such costs with the cost of recruiting outsiders to the coalition, for instance through democratic reforms. I thus argue and then evidence that the set of possible investments – available technology – shape political coalitions. In turn, investments with high variance and unclear covariance – such as technology innovation – will be systematically more likely in countries with inclusive politics, such as democracies.

In "Trade, Technology, and Economic Growth" I develop a new instrument for trade based on containerization and then explore if and how trade brought economic growth in the past half–century. To do so, I construct the most extensive dataset of oceanic distances in existence and leverage the difference between direct ship routes and routes incorporating at least one of twelve early container hubs. I find that in this era trade indeed brought growth, that this was partly driven by increased technology use, and that the effect is larger than previous estimates suggest.