|
on Business, Economic and Financial History |
|
Issue of 2005‒01‒23
eight papers chosen by |
| By: | Price Fishback |
| Abstract: | Between 1869 and the early 1900s state governments regulated safety in mines and factories and reformed the liability for accidents. Reformers sought to reduce workers' risks and ensure that those involved in accidents received reasonable medical care and compensation for lost earnings. Yet large employers often wielded significant clout. This paper explores the extent to which large employers, measured by average number of employees, subverted the safety reform process, including the adoption of safety legislation, its scope, and the resources devoted to enforcement. The findings vary by industry. In coal mining large employers followed a defensive strategy, limiting the breadth of regulation, pressing for regulations that were enforced more against workers than against employers, and weakening enforcement. In manufacturing, on the other hand, safety regulations were introduced earlier in states with larger average establishment sizes. Reformers may have succeeded in imposing regulations on large manufacturing employers. However, the finding is also consistent with large firms working to raise rivals' costs and the analytical narratives suggest that manufacturing employers at times shaped the legislation to their benefit and that the regulations were often poorly enforced. |
| JEL: | N3 N4 K2 H7 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11058&r=his |
| By: | Wing Yuk (Department of Economics, University of Victoria) |
| Abstract: | This study considers the long-run relationship between government expenditure and economic growth for the United Kingdom over the period 1830 to 1993. The causality analysis allows for the effects of exports, and for the presence of complex structural breaks in the data. The results support the export-led growth hypothesis. Although support for Wagner’s Law is sensitive to the choice of sample period, there is evidence that GDP growth Granger-causes the share of government spending in GDP indirectly through exports’ share of GDP during the period 1870-1930. |
| Keywords: | Wagner's law, Granger causality, size of government, structural breaks |
| JEL: | C32 H50 O4 |
| Date: | 2005–01–17 |
| URL: | http://d.repec.org/n?u=RePEc:vic:vicewp:0501&r=his |
| By: | Adelina Gschwandtner; John R. Cable |
| Abstract: | Long run persistence in company profits is analyzed for 156 US companies over a fifty-year period using AR1 and structural time series tests. A statistically significant degree of consitstency is found between them in identifying firms persistently above or below the competitive norm. However, the structural time series method detects a higher overall incidence of persistence, with nearly 70% of firms classed as not having converged on Zero, compared with 46% under AR1 estimation. The recently proposed structural approach is seen as a useful additional tool in analysing earnings dynamics, in particular where are complex trends and other dynamic complexities. |
| JEL: | L12 C32 |
| Date: | 2004–07 |
| URL: | http://d.repec.org/n?u=RePEc:vie:viennp:0409&r=his |
| By: | Uwe Dulleck; Paul Frijters |
| Abstract: | Old elites can block changes, but not all do. Why is it that stronger elites may allow more changes than weaker elites? Why do economies with larger stocks of natural resources not grow faster than economies poorer in natural resources? We argue that old elites hold some power to extract rents from the economy. Whereas old sectors (i.e. agriculture or extraction of natural resources) are not affected by rent extraction, modern sectors require investments that do react to rent extraction. At the same time, a modern sector relies on networks of firms. These structures form the basis of political power of a new elite, which reduces the ability of the old elite to extract rents. We show that countries rich in natural resources provide their old elite with incentives to extract rents so high that the private sector has no incentives to build up a modern economy. If the old elite is either politically very strong or the natural resource sector is small compared to the potential of the modern sector, the old elite will choose to extract smaller rents from a growing sector. Some empirical evidence completes the paper. |
| JEL: | H11 O14 O38 D72 |
| Date: | 2004–05 |
| URL: | http://d.repec.org/n?u=RePEc:vie:viennp:0408&r=his |
| By: | Philip E. Strahan |
| Abstract: | We examine empirically how legal origin, creditor rights, property rights, legal formalism, and financial development affect the design of price and non-price terms of bank loans in almost 60 countries. Our results support the law and finance view that private contracts reflect differences in legal protection of creditors and the enforcement of contracts. Loans made to borrowers in countries where creditors can seize collateral in case of default are more likely to be secured, have longer maturity, and have lower interest rates. We also find evidence, however, that ?Coasian? bargaining can partially offset weak legal or institutional arrangements. For example, lenders mitigate risks associated with weak property rights and government corruption by securing loans with collateral and shortening maturity. Our results also suggest that the choice of loan ownership structure affects loan contract terms. |
| JEL: | K0 G2 O5 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11052&r=his |
| By: | Peter N. Ireland (Boston College) |
| Abstract: | This paper estimates a New Keynesian model to draw inferences about the behavior of the Federal Reserve’s unobserved inflation target. The results indicate that the target rose from 1 1/4 percent in 1959 to over 8 percent in the mid-to-late 1970s before falling back below 2 1/2 percent in 2004. The results also provide some support for the hypothesis that over the entire postwar period, Federal Reserve policy has systematically translated short-run price pressures set off by supply-side shocks into more persistent movements in inflation itself, although considerable uncertainty remains about the true source of shifts in the inflation target. |
| Keywords: | inflation target, new Keynesian model, supply shocks, inflation |
| JEL: | E31 E32 E52 |
| Date: | 2005–01–14 |
| URL: | http://d.repec.org/n?u=RePEc:boc:bocoec:607&r=his |
| By: | Adelina Gschwandtner |
| Abstract: | The present study analyzes and compares profit persistence in four different samples of US companies during the periods 1950-72, 1960-80, 1970-90 and 1980-99. While most of the previous studies perform profit persistence analysis on survivors only, the present setup allows for companies to enter and exit the analyzed sample, thus giving a more comprehensive depiction of the US economy during this half of the century. The results point towards an increase of competition after the opening of the US economy to international competition in the 60-80´s, nevertheless the speed seems to have decreased in the most recent period. Key determinants of profit persistence seem to be firm´s size, industry- and firm growth, and firm growth, and in the most recent period industry concentration, market share, and the company´s merger activity. |
| JEL: | L10 |
| Date: | 2004–09 |
| URL: | http://d.repec.org/n?u=RePEc:vie:viennp:0410&r=his |
| By: | Thomas Colignatus (Samuel van Houten Genootschap) |
| Abstract: | An important aspect for economics and its methodology is the relation between its definitions and the reality that those definitions (should) reflect. Creative minds coin definitions that maximize explanatory power. An example that highlights this phenomenon can be found in physics and notably by the article in The Economist January 1 2005 on 100 years of Einstein. Physics with its methodology has had more impact on economics than the other way round. Physics seems to have become an arcane science and one wonders whether economics goes the same road. Both sciences are in danger of losing touch with reality and either blow up the world or destroy the world's economy if they don't spend close attention to their definitions and their transparancy. While it is most likely that the author simply doesn't understand physics, the exposition may still be beneficial for students of economics and its methodology. |
| JEL: | A00 |
| Date: | 2005–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpgt:0501003&r=his |