This paper develops a model in which the interaction of entrepreneurial investments and power of the owners of land or other natural resources determines structural change and economic development. A more equal distribution of natural resources promotes structural change and growth through two...

What are the long-term economic effects of a more equal distribution of wealth? We exploit variation in historical inheritance rules for land in Germany. In some German areas, inherited land was to be shared or divided equally among children, while in others land was ruled to be indivisible....