TY - JOUR AU - Doepke, Matthias AU - Zilibotti, Fabrizio TI - Occupational Choice and the Spirit of Capitalism JF - National Bureau of Economic Research Working Paper Series VL - No. 12917 PY - 2007 Y2 - February 2007 DO - 10.3386/w12917 UR - http://www.nber.org/papers/w12917 L1 - http://www.nber.org/papers/w12917.pdf N1 - Author contact info: Matthias Doepke Northwestern University Department of Economics 2211 Campus Drive Evanston, IL 60208 Tel: 847-491-8207 E-Mail: doepke@northwestern.edu Fabrizio Zilibotti Department of Economics Yale University 28 Hillhouse Avenue New Haven, CT 06520 Tel: 203/432-9561 E-Mail: fabrizio.zilibotti@yale.edu AB - The British Industrial Revolution triggered a reversal in the social order of society whereby the landed elite was replaced by industrial capitalists rising from the middle classes as the economically dominant group. Many observers have linked this transformation to the contrast in values between a hard-working and frugal middle class and an upper class imbued with disdain for work. We propose an economic theory of preference formation where both the divergence of attitudes across social classes and the ensuing reversal of economic fortunes are equilibrium outcomes. In our theory, parents shape their children's preferences in response to economic incentives. This results in the stratification of society along occupational lines. Middle-class families in occupations that require effort, skill, and experience develop patience and work ethics, whereas upper-class families relying on rental income cultivate a refined taste for leisure. These class-specific attitudes, which are rooted in the nature of pre-industrial professions, become key determinants of success once industrialization transforms the economic landscape. ER -