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The Death of King Coal and the Scars of Deindustrialization
CEPR
2024.05.21
This paper investigates the human cost of industrial decline. We focus on the largest contraction of the coal industry in the UK. Using longitudinal data following two cohorts born in 1958 and 1970, we estimate the lifelong effects of being exposed to pit closures dur- ing childhood on health and economic outcomes. Those exposed to the shock as children have worse health throughout life, and this effect transmits over generations. They are also raised in less privileged economic conditions and accumulate less wealth as adults. We also uncover that migration is an imperfect mitigation strategy. The longitudinal data structure allows us to account for different trajectories in the effects across locations and cohorts. We also verify that outcomes are identical in levels before the shock. Results are robust to a battery of robustness checks. These findings highlight that in the absence of any support, industrial decline has long-lasting consequences imperfectly mitigated by access to better opportunities. Few people move, and those who do keep a scar.