Does war have important long-term economic consequences? Existing literature suggests a lack of long-term effects related to the short-term destruction of physical capital and population reduction. Increased ideological and social division as a result of war, on the other hand, may produce persistent economic and social outcomes. I investigate the effect of the 1950-1953 Korean War on cooperation within rural communities in South Korea. Combining census data and unique data on village level collective action, I find that residents of townships that experienced more intense conflicts due to the prolonged presence of the North Korean Army and communist influences during the war were less likely to cooperate 20 years after the war ended. Further, I provide evidence that the reductions in township populations due to the conflict persisted over 40 years. The empirical results suggest that the impacts of the war persisted in the form of increased ideological and social division.
Hyunjoo Yang is an assistant professor at Incheon National University (INU) in South Korea. He received his Ph.D. in Economics from Brown University in 2016, a M.Sc. in Economics from the London School of Economics in 2010, and a B.A. in Trade and Commerce from INU in 2008. Before joining INU, he was an associate fellow at the Korea Development Institute. Recently, his paper, “Family Clans and Public Goods: Evidence from the New Village Beautification Project in South Korea,” was accepted for publication at the Journal of Development Economics.