History isn’t just of historical interest – it matters for understanding economies today. That’s the lesson of a growing body of research demonstrating the very long shadow cast by events.
A new paper on the Spanish Inquisition proves the point. The Inquisition lasted from the late 15th century to the early 19th century. Its aim was to root out heresy and its methods were the denunciation of suspects followed by torture and executions. The researchers examined how active the Inquisition was in local areas by considering the number of trials and reveal its lasting effect: areas with little or no Inquisition activity have around 8% (€1,450) higher average incomes than those that had lots of persecution.
Why? Well, engaging with new ideas or talking to others might be essential to economic development, but it’s not very attractive when it could get you accused of heresy. Maybe those leading the Inquisition would be happy that high persecution areas tend to be more religious today, but they also have lower education and trust levels than other parts of Spain. Both are key drivers of growth.
Low incomes aren’t because the Inquisition was active in poor areas – because it relied on fines for its finances, it had a strong incentive to focus on richer people and places. The study reminds us that state-backed religious extremism is nothing new. And that it’s a very bad idea indeed.