Abstract

This paper provides new and comprehensive evidence on the relationship between ethnic segregation and Arab and Jewish human capital formation in Mandate Palestine, the historical period in which the roots of the current reality of inter-ethnic separation were built. Using a novel panel dataset (1927-1945), I exploit geographic and time variation in the degree of segregation across Palestine to assess whether it affected schooling outcomes, observed on average for each ethnic group. The empirical findings suggest that segregation negatively affected Muslim and Christian school enrolments, while being positively associated with Jewish school provision. The negative impact of segregation on Arab schooling was primarily driven by negative income effects.

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