Income inequality and famine mortality: evidence from the Finnish famine of the 1860s

by Miikka Voutilainen (University of Jyvaskyla)

This blog is based on the author’s article which has been published in the Economic History Review and is now available as open access at this link: https://onlinelibrary.wiley.com/doi/10.1111/ehr.13095

Accepted wisdom holds that the poorer and more unequal the society, the greater its risk of experiencing fluctuations in living standards that result in mortality.  Over the last 40 years, this ‘ripple that drown’ hypothesis has often been surpassed by Amartya Sen’s entitlement framework, which has drawn attention to shifts in purchasing power and the distribution of economic capabilities to explain food security crises.  Recently, the study of famines has taken a ‘historical turn’.  Scholars such as Guido Alfani, Bruce Campbell, and Cormac Ó Gráda, have shown that the further back in time  we go, harvest fluctuations, low agricultural productivity, and economic backwardness become increasingly important as explanations of  the occurrence and timing of famines (Campbell, 2010; Alfani and O Grádá, 2018).

Many studies have shown robust correlations between crop failures and the incidence of famine, but as is well known, the characteristics of famines are diverse: from increases in malnutrition to cataclysmic events of biblical proportions.  But what explains how food availability systematically affects mortality?  Theoretical studies conducted in the 1980s remind us that the effects of  inequality are not always obvious.

Determining the effects of  poverty and inequality is complicated  by the lack of data.  The Finnish famine,1866-1869 — often dubbed the last peacetime population disaster in West Europe – accounted for a population loss of almost 10 per cent of the pre-famine population (Voutilainen 2016).  Fortunately,  in Finland, detailed demographic and income data are available  for the nineteenth century (Figure 1).

Finland introduced income tax for the first time in 1864. The coverage of this household level tax varied between parishes and exhibited considerable annual variation.  For example, at the pinnacle of the famine,  1867-1868, only the parish priest was subject to income tax in the Western Finnish parish of Nivala.  By chance,  recent econometric advances have facilitated estimations based  on censored income distributions (Hong et al., 2018).

My research reports an intriguing connection between income inequality and famine mortality. Using  unique longitudinal and multivariate spatial panel data, I analyse the determinants of mortality during the Finnish famine and assess whether economic inequality intensified the adverse effects of harvest, price, and income shocks.   My results indicate that while low average income and high inequality intensified the negative effects of  reductions in food output, the same conditions weakened market-mediated shocks. Unequal distribution of income greatly constrained individuals’ access to food markets and was therefore an important factor  determining whether price and income shocks  increased mortality.

Further, my  results show that income and price shocks ceased to influence local mortality development in an environment of high-income inequality. This observation does not necessarily make inequality beneficial: high income inequality increases the severity of food output fluctuations, vindicating the ‘ripple that drown’ hypothesis. These findings emphasise the importance of aggregate entitlements in explaining where, when, and why, certain shocks lead to certain mortality outcomes (Figure 2).

My research can inform debates on the absence  of large European famines in the Late Middle Ages (Alfani and O Grádá, 2018),  and the post-Black Death period which was characterised by high living standards and by the much more equal distribution of wealth compared to the early 14^th century (Alfani 2021).

To contact the author : miikka.p.voutilainen@jyu.fi

Bibliography

Alfani, G. (2021). Economic inequality in preindustrial times: Europe and beyond. Journal of Economic Literature, 59(1), 3-44.

Alfani, G., & Ó Gráda, C. (2018). The timing and causes of famines in Europe. Nature Sustainability, 1(6), 283-288.

Campbell, B. M. (2010). Nature as historical protagonist: environment and society in pre‐industrial England. The Economic History Review, 63(2), 281-314.

Hong, L., Alfani, G., Gigliarano, C., & Bonetti, M. (2018). giniinc: A Stata package for measuring inequality from incomplete income and survival data. The Stata Journal, 18(3), 692-715.

Voutilainen, M. (2016). Poverty, Inequality and the Finnish 1860s Famine. University of Jyväskylä.