This paper analyzes long-term effects of skilled-worker immigration on productivity for the Huguenot migration to Prussia. In 1685, religiously persecuted French Huguenots settled in Brandenburg- Prussia and compensated for population losses due to plagues during the Thirty Years' War. We combine Huguenot immigration lists from 1700 with Prussian firm-level data on the value of inputs and outputs in 1802 in a unique database to analyze the effects of skilled immigration to places with underused economic potential. Exploiting this settlement pattern in an instrumental-variable approach, we find substantial long-term effects of Huguenot settlement on the productivity of textile manufactories.
We develop a model in which connections between individuals serve as social collateral to enforce informal insurance payments. We show that: (i) The degree of insurance is governed by the expansiveness of the network, measured with the per capita number of connections that groups have with the rest of the community. "Two-dimensional" networks—like real-world networks in Peruvian villages—are