APPLIED MICRO: Salt trafficking and Violent Human Capital; Dr Zhao Yiling (Peking University)

Abstract

This paper studies how civilians developed violence capacity and propensity in response to Qing China’s centralized control over the salt industry. The salt tax was an iniquitous institution that sold exclusive rights to salt merchants and granted them monopoly status in each local market, resulting in higher than competitive-market salt prices. To facilitate management, China was divided into 11 salt districts that confined production and consumption in each district, and the price parity across district borders can be twice as high. The price parities created incentives for smuggling salt, which resulted in repeated violence between the state and the traffickers. We use an RD approach to identify government-inflicted violence, quantified by checkpoints established and crack- downs reported, and the civilian violence level in response, measured by degree holders in military exams (Wuju) divided by those in civilian exams (Keju).