nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2008‒07‒05
thirteen papers chosen by
Bernardo Batiz-Lazo
University of Leicester

  1. Uses of National Accounts; History, International Standardization and Applications in the Netherlands By Bos, Frits
  2. History of a very special romance: emergence and difussion of double entry book-keeping in Mexico By Batiz-Lazo, Bernardo; Hernandez-Borreguero, Julian; Maixe-Altes, J. Carles; Nu~ez-Torrado, Miriam
  3. From the New Wave to the New Hollywood: The Life Cycles of Important Movie Directors from Godard and Truffaut to Spielberg and Eastwood By David Galenson; Joshua Kotin
  4. Intensified Regulatory Scrutiny and Bank Distress in New York City During the Great Depression By Gary Richardson; Patrick Van Horn
  5. Is the future of the ATM past? By Batiz-Lazo, Bernardo; Reese, Claudia
  6. Performance budgeting: Its rise and fall By Nguyen, Hoang-Phuong
  7. Global Trade and the Maritime Transport Revolution By David S. Jacks; Krishna Pendakur
  8. Henry Agard Wallace, the Iowa Corn Yield Tests, and the Adoption of Hybrid Corn By Richard C. Sutch
  9. Executive Compensation: A New View from a Long-Term Perspective, 1936-2005 By Carola Frydman; Raven E. Saks
  10. A Quantitative Exploration of the Golden Age of European Growth By Francisco Alvarez-Cuadrado; Mihaela I. Pintea
  11. The Quantity Theory of Money in Historical Perspective By Michael Graff
  12. Biological Innovation and Productivity Growth in the Antebellum Cotton Economy By Alan L. Olmstead; Paul W. Rhode
  13. Futures of automobile industry and challenges on sustainable development and mobility By António Brandão Moniz; Margarida Paulos

  1. By: Bos, Frits
    Abstract: The national accounts is commonly known by its key-aggregates (e.g. GDP and saving) and their role in public debate and decision-making. However, the national accounts plays many different roles for many different uses. This paper provides an overview of the development of these roles and uses since the seventeenth century. Three periods are distinguished: the early estimates (1660-1930), revolutionary decades (1930-1950) and the era of the international guidelines (1950-present). The paper discusses these roles and uses also much more in detail for one country: the Netherlands, a country which played an important role in modern national accounting and where expert data users, like the CPB, SCP and the Dutch central bank, have developed several interesting applications of the national accounts.
    Keywords: Uses of the national accounts; history of national accounting; history of taxation; economic growth; Dutch national accounts; relevance and reliability of the national accounts; Petty; King; Vauban; Quesnay; Keynes; Clark; Kuznets; Leontief; Tinbergen; Hicks; van Cleeff; Stone; Meade; guidelines on national accounting; European unification; macro-economic modeling and forecasting; CPB; SCP; Dutch central bank; fiscal policy; productivity analysis; performance management; national accounts and welfare; measurement in economics
    JEL: B0 C82 E01
    Date: 2008
  2. By: Batiz-Lazo, Bernardo; Hernandez-Borreguero, Julian; Maixe-Altes, J. Carles; Nu~ez-Torrado, Miriam
    Abstract: English abstract There is consensus in Mexican accounting historiography on the use of double entry bookkeeping by the end of the 19th century on both private and public enterprise. However, there is conflicting and even contradictory accounts as to when exactly did this technique arrived to the then New Spain (Nueva Espana) as well as its difussion during colonial and post-colonial eras. In this article we address this conflict first by using primary and secondary source material from both Spain and its former colony. Resumen Existe consenso en la historiografía contable mexicana sobre el uso de la partida doble en la hacienda pública y en el ámbito privado desde finales del siglo XIX. Sin embargo, las fuentes y la información disponible son contradictorias respecto a su origen y difusión durante la colonización española y tras la independencia. Este artículo se propone acotar dicho debate y obtener nuevas conclusiones. Para alcanzar estos objetivos, por un lado revisamos la historia de la contabilidad novohispana y metropolitana; y, por otro, contrastamos estos resultados utilizando fuentes primarias y nuevas evidencias de archivo.
    Keywords: Mexico; Spain; double entry bookkeeping;
    JEL: M41 N36
    Date: 2008–06
  3. By: David Galenson; Joshua Kotin
    Abstract: Two great movie directors were both born in 1930. One of them, Jean-Luc Godard, revolutionized filmmaking during his 30s, and declined in creativity thereafter. In contrast, Clint Eastwood did not direct his first movie until he had passed the age of 40, and did not emerge as an important director until after 60. This dramatic difference in life cycles was not accidental, but was a characteristic example of a pattern that has been identified across the arts: Godard was a conceptual innovator who peaked early, whereas Eastwood was an experimental innovator who improved with experience. This paper examines the goals, methods, and creative life cycles of Godard, Eastwood, and eight other directors who were the most important filmmakers of the second half of the twentieth century. Francis Ford Coppola, Stanley Kubrick, Stephen Spielberg, and François Truffaut join Godard in the category of conceptual young geniuses, while Woody Allen, Robert Altman, John Cassavetes, and Martin Scorsese are classed with Eastwood as experimental old masters. In an era in which conceptual innovators have dominated a number of artistic activities, the strong representation of experimental innovators among the greatest film directors is an interesting phenomenon.
    JEL: J01
    Date: 2008–06
  4. By: Gary Richardson; Patrick Van Horn
    Abstract: New data reveals that bank distress peaked in New York City, at the center of the United States money market, in July and August 1931, when the banking crisis peaked in Germany and before Britain abandoned the gold standard. This paper tests competing theories about the causes of New York's banking crisis. The cause appears to have been intensified regulatory scrutiny, which was a delayed reaction to the failure of the Bank of United States, rather than the exposure of money-center banks to events overseas.
    JEL: E42 G21 N1 N12
    Date: 2008–06
  5. By: Batiz-Lazo, Bernardo; Reese, Claudia
    Abstract: Just over 40 years ago the first cash dispensers became operational in the UK. From its modest beginnings this industry specific application evolved into the backbone of self service technology. In this article we consider their past and present to reflect on their future with the assistance of the so called ‘social construction of technology’ theory while supported by archival research and a summary of interviews with ‘actors’ in the UK. We tell how machine, functionality and shared networks will continue to interact in shaping the future of the cash dispensing market.
    Keywords: cash dispenser; ATM; payment systems; UK; networks; self-service market; multilateral interchange fee (MIF); LINK
    JEL: L14 N24 L80 G21
    Date: 2008–06
  6. By: Nguyen, Hoang-Phuong
    Abstract: Among various budgeting theories and practices at the federal level, performance budgeting has played an important role with its long developmental history. Performance budgeting was short-lived as it was replaced by program budgeting in the early 1960s. Looking at the period between the first decade of the twentieth century and the mid-1960s, the present paper seeks to investigate two major questions to which budgetary literature has given short shrift: 1) What forces led to the emergence of performance budgeting and its earlier forms?, and 2) Why did the budgeting practice fall into disfavor at the federal level shortly after a prolonged period to get institutionalized? The paper's investigation of the first question reveals three major factors that gave rise to performance budgeting and its forerunners: the rise of scientific management by Frederick Taylor, increasing public pressure on the government's role and practices, and the expansion of government responsibilities. Three principal opposing forces attributed to the long gestation of performance budgeting and its premature decline are its inherent weaknesses and limitations, the legislature's hostility to it, and the rapid rise of a new budgeting practice.
    JEL: H83
    Date: 2007–11
  7. By: David S. Jacks; Krishna Pendakur
    Abstract: What is the role of transport improvements in globalization? We argue that the nineteenth century is the ideal testing ground for this question: freight rates fell on average by 50% while global trade increased 400% from 1870 to 1913. We estimate the first indices of bilateral freight rates for the period and directly incorporate these into a standard gravity model. We also take the endogeneity of bilateral trade and freight rates seriously and propose an instrumental variables approach. The results are striking as we find no evidence that the maritime transport revolution was the primary driver of the late nineteenth century global trade boom. Rather, the most powerful forces driving the boom were those of income growth and convergence.
    JEL: F15 F40 N70
    Date: 2008–06
  8. By: Richard C. Sutch
    Abstract: This research report makes the following claims: 1] There was not an unambiguous economic advantage of hybrid corn over the open-pollinated varieties in 1936. 2] The early adoption of hybrid corn before 1937 can be better explained by a sustained propaganda campaign conducted by the U.S. Department of Agriculture at the direction of the Secretary of Agriculture, Henry Agard Wallace. The Department's campaign echoed that of the commercial seed companies. The most prominent hybrid seed company, Pioneer Hi-Bred Company, was founded by Wallace and he retained a financial interest while serving as Secretary. 3] The early adopters of hybrid seed were followed by later adopters as a consequence of the droughts of 1934 and especially 1936. The eventual improvement of yields as newer varieties were introduced explains the continuation and acceleration of the process.
    JEL: N12
    Date: 2008–06
  9. By: Carola Frydman; Raven E. Saks
    Abstract: We analyze the long-run trends in executive compensation using a new panel dataset of top executives in large publicly-held firms from 1936 to 2005, collected from corporate reports. This historic perspective reveals several surprising new facts that conflict with inferences based only on data from the recent decades. First, the median real value of compensation was remarkably flat from the end of World War II to the mid-1970s, even during times of rapid economic expansion and aggregate firm growth. This finding contrasts sharply with the steep upward trajectory of pay over the past thirty years, which coincided with a period of similarly large increases in aggregate firm size. A second surprising finding is that the sensitivity of an executive's wealth to firm performance was not inconsequentially small for most of our sample period. Thus, recent years were not the first time when compensation arrangements served to align managerial incentives with those of shareholders. Taken together, the long-run trends in the level and structure of compensation pose a challenge to several common explanations for the widely-debated surge in executive pay of the past several decades, including changes in firms' size, rent extraction by CEOs, and increases in managerial incentives.
    JEL: G30 J33 M52 N82
    Date: 2008–06
  10. By: Francisco Alvarez-Cuadrado (Department of Economics, McGill University); Mihaela I. Pintea (Department of Economics, Florida International University)
    Abstract: Income per capita in some Western European countries more than tripled in the two and a half decades that followed World War II. The literature has identified several factors behind this outstanding growth episode, specifically; structural change associated with large migrations from agriculture to nonagricultural sectors, the Marshall Plan combined with the public provision of infrastructure, the surge of intra-European trade, and the reconstruction process that followed the devastation of the war. This paper is an attempt to formalize and quantify the direct contribution of each one of these factors to growth during the European Golden Age. Our results highlight the importance of reconstruction growth and structural change, and point to the limited role of the Marshall Plan, and the late contribution of intra-European trade.
    Keywords: Economic Growth, European Economic History 1913-, Computable General Equilibrium Models.
    JEL: O40 N14 C68
    Date: 2008–06
  11. By: Michael Graff (KOF Swiss Economic Institute, ETH Zurich)
    Abstract: The paper reconstructs the origins of the quantity theory of money and its applications. Against the background of the history of money, it is shown that the theory was flexible enough to adapt to institutional change and thus succeeded in maintaining its relevance. To this day, it is useful as an analytical framework. Although, due to Goodhart's Law, it now has only limited potential to guide monetary policy and was consequently abandoned by most central banks, an empirical analysis drawing on a panel data set covering more than hundred countries from 1991 to the present confirms that the theory still holds: a positive correlation between the excess growth rate of the stock of money and the rate of inflation cannot be rejected. Yet, while the correlation holds for the whole sample, proportionality is driven by a small number of influential observations with very high inflation
    Keywords: Quantity theory of money, demand for money, monetary targeting
    JEL: B10 E41 E58
    Date: 2008–04
  12. By: Alan L. Olmstead; Paul W. Rhode
    Abstract: The Cliometrics literature on slave efficiency has generally focused on static questions. We take a decidedly more dynamic approach. Drawing on the records of 142 plantations with 509 crops years, we show that the average daily cotton picking rate increased about four-fold between 1801 and 1862. We argue that the development and diffusion of new cotton varieties were the primary sources of the increased efficiency. These finding have broad implications for understanding the South's preeminence in the world cotton market, the pace of westward expansion, and the importance of indigenous technological innovation.
    JEL: J43 N11 N5 O3
    Date: 2008–06
  13. By: António Brandão Moniz (IET - Research Centre on Enterprise and Work Innovation - WORKS project); Margarida Paulos (IET - Research Centre on Enterprise and Work Innovation - Universidade Nova de Lisboa - Faculty of Sciences and Technology - Faculty of Sciences)
    Abstract: Portugal had only very few foresight exercises on the automobile sector, and the most recent one was a survey held in a project on work organisation systems in the automobile industry, its recent historical paths and the special strategies of location of companies (the WorTiS project). This involved several teams with different disciplinary backgrounds and from two Portuguese universities. The provisional main results of the first round of a Delphi survey held in Portugal on the automotive sector were already published, but a further analysis was not yet done. This foresight survey was done under the WorTiS project, developed in 2004 by IET – Research Centre on Enterprise and Work Innovation (at FCT-UNL), and financed by the Portuguese Ministry of Science and Technology. Some of this experience on foresight analysis is also been transferred to other projects, namely the WORKS project on work organisation restructuring in the knowledge society that received the support from EC and still is running. The majority of experts considered having an average of less knowledge in almost all the scenario topics presented. This means that information on the automotive industry is not spread enough among academics or experts in related fields (regional scientists, innovation economists, engineers, sociologists). Some have a good knowledge but in very specialised fields. Others have expertise on foresight, or macroeconomics, or management sciences, but feel insecure on issues related with futures of automobile sector. Nevertheless, we considered specially the topics where the experts considered themselves to have some knowledge. There were no “irrelevant” topics considered as such by the expert panel. There are also no topics that are not considered a need for co-operation. The lack of technological infrastructures was not considered as a hindered factor for the accomplishment of any scenario. The experts’ panel considered no other international competence besides US, Japan or Germany in these topics. Special focus will be made in this paper on the topic 2. Public policy and automobile industries, and more specifically on the technological and/or research policies issues, where one can specify the automobile’s role in transport policies with further implications like environment, safety, energy, mobility.
    Keywords: automotive industry; scenario; economical co-operation; technology; Delphi survey
    Date: 2008–05–09

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