In this paper, we study the link between self-interest and morality by leveraging a historical context with extremely high stakes: the introduction of "Economic Aryanization" in the city of Bordeaux, France, during World War II. This policy aimed to “permanently remove the Jewish influence in the economy” through the expropriation of Jewish firms. Regional authorities had significant autonomy in implementing the policy, which left substantial scope for competing firms to influence the procedure. We combine information on the universe of expropriated Jewish firms in the city of Bordeaux with the 1939 Yellow Pages to reconstruct the market structure of sectors in which Jewish firms operated. Our baseline estimation indicates that, conditional on a wide array of covariates, the risk of expropriation for a Jewish firm with a gentile competitor in its street is 1.7 times greater than for a competing Jewish firm with no gentile competitor close by. The reduced-form results are confirmed by estimating a structural model in which distance between gentile and Jewish competitors is one of the drivers of denunciation. The effect is not present when looking at Jewish competitors.
About the Speaker
Stephanos Vlachos is an applied economist with a research interest in the broader field of political economy. His past research has focused on the vote for radical movements and media economics. He had investigated both the demand- and supply-side of electoral politics by looking at the origins of voter preferences, how voter beliefs are formed, and how politicians can use campaign strategies to persuade the electorate. He studied these questions empirically, with a focus on identification, while also exploiting theory-based insights. He often, though not exclusively, uses historical data. Stephanos is of the view that sufficient knowledge of historical events can help identify quasi-natural experiments that can be exploited to answer a broad range of questions that are policy relevant nowadays.