ASSAF Y. ABRAHAM
I am a Ph.D. student in Economics at the University of Mannheim.
I am an economic historian. My research focuses on the determinants of resource-driven industrialization, and on the intergenerational consequences of farm-to-factory structural change.
My supervisor is Philipp Ager. Also on my dissertation committee are Antonio Ciccone and Jochen Streb.
You can find my CV here.
Read my Job Market Paper here.
Job Market Paper: One Hundred Years of Manufacturing: Long-run Consequences of the Indiana Gas Boom
Abstract: I examine the long-run consequences of a temporary, localized energy boom on local manufacturing development. Exploiting the 1886 discovery of natural gas in eastern Indiana, I use decadal U.S. census data on manufacturing activity to document how fifteen years of cheap natural gas spurred manufacturing growth in the region that persisted for nearly a century—despite the gas supply’s collapse in 1901. Comparing gas-rich counties with similar non-gas counties, I show that gas counties experienced both immediate and sustained manufacturing growth. Initially driven by glass and iron industries, this growth survived the collapse of gas supply, and later expanded to machinery and automobiles, indicating the presence of agglomeration forces in manufacturing that offset the loss of the initial advantage. This early industrial boom in the gas region was driven by a unique geological circumstance that complicated the transportation of gas to distant markets and pushed gas producers to attract manufacturers to the region with offers of cheap energy. To underscore the importance of this transportability constraint, I contrast Indiana with the Appalachian gas region, which faced no such limitations and exported most of its gas to distant urban markets. Appalachian gas counties experienced only modest excess manufacturing growth. The comparison highlights that even a temporary resource boom, when used as an input in local production, can create enduring advantages for local manufacturing industries.
Current Research
Local Industrialization, Land Values, and Intergenerational Mobility: Evidence from the Indiana Gas Boom
Abstract: How did local industrialization historically affect U.S. farmers and their children? I show that when farmers owned their land, they gained from local industrialization through the wealth effects of rising land values. These higher land values mostly reflected the growing opportunity cost of keeping land in agriculture and the option to sell or lease it for industrial and urban uses, which in turn gave these farmers the wealth to invest in their children. I study this in the setting of the Indiana Gas Boom: because natural gas in Indiana could not be transported and had to be consumed locally, the discovery of cheap energy created a geographically concentrated manufacturing boom by forcing industry to locate near the gas field in order to use the gas, thus providing a rare causal look at exogenous local industrialization. I show at first that gas counties experienced a decline in agricultural labor and a large increase in land values, without a comparably large increase in agricultural labor productivity. Taken together, these patterns are consistent with local crowding out of agriculture that pushed up land prices. Rather than entering the new industrial workforce, incumbent farmers generally stayed on their farms, while young men from elsewhere fueled the region’s industrial expansion. Second, I link 36,333 fathers from both gas and non-gas counties who were children on farms in 1880—before the Indiana Gas Boom—to their sons observed in 1910 and 1940. I show that the sons of Gas Boom farmers typically left farming and, as adults, were better educated, higher paid, and more geographically mobile than the sons of farmers in otherwise similar counties that did not experience comparable industrialization. Taken together, this shows that local industrialization had positive economic effects on incumbent farmers, the full extent of which became apparent in the second generation exposed to industrialization.
Early Industrialization and the Resource Transportability Curse
Abstract: Why did early resource discoveries fuel the rise of factory towns, while later discoveries produced ghost towns? In this paper, I develop a spatial equilibrium model to explain why early industrialization clustered around coalfields, yet later resource booms failed to produce local manufacturing clusters, and why regions that were historically manufacturing-intensive have gradually been dragged down by their co-location with coal mining. The key insight of the model is that the extent to which a resource can be transported determines the degree to which its discovery crowds in manufacturing. During early industrialization, resource-abundant regions enjoyed a comparative advantage in manufacturing by providing cheap access to raw materials. Over time, advances in transportation technology reduced this local price advantage. Lower transport costs also broadened market access for local extraction sectors and increased the potential for local Dutch Disease dynamics to emerge, further weakening—or even reversing—the crowding-in effects of resource discoveries. I call this pattern the “resource transportability curse”. Many factory towns that were initially built near extraction sites at a time when transportation costs were high continued manufacturing despite the subsequent decline in transportation costs, due to agglomeration economies and sunk investments. By contrast, newer towns that arose near extraction sites after transport costs had fallen tended to focus more on mining and resource extraction than on manufacturing, and these towns often declined once the resource was depleted. My empirical analysis supports the model’s core predictions.
Early Stage Work
Oil Origins: Local Effects of the Pennsylvania Oil Rush
Upcoming Talks
Seminar presentation at Université libre de Bruxelles, November 21 in Brussels
Latest Talks
VfS Annual Conference 2025, September 14-17 in Cologne
Economic History Association Annual Meeting 2025, September 5-7 in Philadelphia (poster)
PhD Workshop in Quantitative Economic History, June 19 in Belfast
3rd Essex PhD Conference in Applied Economics, March 20-21 in Colchester
