Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/213595
Authors: 
Lichter, Andreas
Löffler, Max
Siegloch, Sebastian
Year of Publication: 
2019
Series/Report no.: 
ifo Working Paper No. 317
Abstract: 
We investigate the long-run effects of government surveillance on civic capital and economic performance, studying the case of the Stasi in East Germany. Exploiting regional variation in the number of spies and administrative features of the system, we combine a border discontinuity design with an instrumental variables strategy to estimate the long-term, post-reunification effect of government surveillance. We find that a higher spying density led to persistently lower levels of interpersonal and institutional trust in post-reunification Germany. We also find substantial and long-lasting economic effects of Stasi surveillance, resulting in lower income, higher exposure to unemployment, and lower self-employment.
Subjects: 
Civic capital
government surveillance
trust
economic performance
East Germany
JEL: 
H11
N34
N44
P20
Document Type: 
Working Paper

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