New Economics Papers
on Business, Economic and Financial History
Issue of 2009‒04‒05
nine papers chosen by

  1. Monetary Time Series of Southeastern Europe from the 1870s to 1914 By Members of the SEEMHN data collection task force with a foreword by Michael Bordo and an introduction by Matthias Morys;
  2. Was Weber Wrong? A Human Capital Theory of Protestant Economic History: A Comment on Becker and Woessmann By Christoph A. Schaltegger; Benno Torgler
  3. Fifty Years of Urban Accessibility: The Impact of Urban Railway Network on the Land Gradient in Industrializing Berlin By Gabriel Ahlfeldt; Nicolai Wendland
  4. The Consequences of Radical Reform: The French Revolution By Daron Acemoglu; Davide Cantoni; Simon Johnson; James A. Robinson
  5. Technological change, financial innovation, and diffusion in banking By W. Scott Frame; Lawrence J. White
  6. Cost calculations, religion and commerce: the Book of Good Government of the Souk of Malaga in the 13th Century By Jesús D. López- Manjón; Fernando Gutiérrez Hidalgo; Francisco Carrasco Fenech
  7. Fluctuations in Overseas Travel by Americans, 1820 to 2000 By Brandon Dupont; Alka Gandhi; Thomas Weiss
  8. Transforming Bad Banks into Good Banks: Lessons from the Chilean Financial Crisis By Philip Brock
  9. Da arte de conhecer as doenças: o diagnóstico da Economia Mineira de 1968 e o planejamento do desenvolvimento de Minas Gerais By Marcelo Magalhães Godoy; Daniel Henrique Diniz Barbosa; Lidiany Silva Barbosa

  1. By: Members of the SEEMHN data collection task force with a foreword by Michael Bordo and an introduction by Matthias Morys;
    Abstract: TThe South-Eastern European Monetary History Network (SEEMHN) is a community of financial historians, economists and statisticians, established in April 2006 at the initiation of the Bulgarian National Bank and the Bank of Greece. Its objective is to spread knowledge on the economic history of the region in the context of European experience with a specific focus on financial, monetary and banking history. The SEEMHN Data Collection Task Force aims at establishing a historical database with 19th and 20th century financial and monetary data for the countries in the region. A set of data has already been published as an annex to the 2007 conference proceedings, released by the OeNB (2008, Workshops, no 13). The second stage of the SEEMHN Data Collection Task force includes reports from all participating central banks. For each country, historical aggregates are preceded by a description of the country’s monetary events and explanatory remarks. The data set refers to banknotes in circulation, reserves, discount rates and exchange rates. The frequency is monthly and the time span covers the period from 1870 and beyond to 1914. A foreword on the paramount importance of historical data series is supplemented by Prof. Michael Bordo (Rutgers University). An introduction on crosscountry historical comparison is written by Dr. Matthias Morys (University of York). Here we present data displays for each country written by Kliti Ceca, Kelmend Rexha and Elsida Orhan for Albania (Banka e Shqiperise); Thomas Scheiber for Austria-Hungary (Oesterreichische Nationalbank); Kalina Dimitrova (Balgarska Narodna Banka) and Martin ivanov (Bulgarian Academy of Science) for Bulgaria; Sopfia Lazaretou for Greece (Bank of Greece); George Virgil Stoenescu, Elisabeta Blejan, Brindusa Costache and Adriana Iarovici Aloman for Romania (Banca Nationala a Romaniei); Milan Sojic, Ljiljana Durdevic, Sanja Borkovic and Olivera Jovanovic for Serbia (Narodna Banka Srbije). We strongly believe that by making the historical time series available to a wider audience for the first time ever, research interests in monetary and financial economics in this part of Europe will be further stimulated.
    Date: 2009–02
  2. By: Christoph A. Schaltegger; Benno Torgler
    Abstract: This comment makes a contribution to Becker and Woessmann’s paper on a human capital theory of Protestant economic history eventually challenging the famous thesis by Max Weber who attributed economic success to a specific Protestant work ethic (Quarterly Journal of Economics 124 (2) (2009) forthcoming). The authors argue for a human capital approach: higher literacy among Protestants of the 19th century (and not a Protestant work ethic) contributed to higher economic prosperity at that point in history. However, the paper leaves the question open as to whether a Protestant specific work ethic existed or exists at all. Are there observable denomination-based differences in work ethic or is Protestantism only a veil hiding the underlying role of education? We use recent data to explore the role of Protestantism on work ethic. The results indicate that today’s work ethic in fact is influenced by denomination-based religiosity and also education.
    Keywords: Religion, Work Ethic, Protestantism, Education
    JEL: Z12 I20 J24
    Date: 2009–03–23
  3. By: Gabriel Ahlfeldt (Chair for Economic Policy, University of Hamburg); Nicolai Wendland (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: As the first to use an archival data set on historical land values of Berlin, Germany, from 1890 to 1936, we exploit exogenous variation in transport technology in order to test the validity of the monocentric city model. Endogenously determining the CBD, we conduct cross-section and timedifference analysis and model the land gradient in terms of straight-line distance and travel times. A counterfactual scenario indicates that a large proportion of urban decentralization is attributable to improvements in transport infrastructure. Controlling for spatial dependency, results suggest that the monocentric model fitted the city structure until the mid 20th century.
    Keywords: Transport Innovations; Land Values; Location Productivity; Economic History
    JEL: N7 N9 R33 O12
    Date: 2008–10
  4. By: Daron Acemoglu; Davide Cantoni; Simon Johnson; James A. Robinson
    Abstract: The French Revolution of 1789 had a momentous impact on neighboring countries. The French Revolutionary armies during the 1790s and later under Napoleon invaded and controlled large parts of Europe. Together with invasion came various radical institutional changes. French invasion removed the legal and economic barriers that had protected the nobility, clergy, guilds, and urban oligarchies and established the principle of equality before the law. The evidence suggests that areas that were occupied by the French and that underwent radical institutional reform experienced more rapid urbanization and economic growth, especially after 1850. There is no evidence of a negative effect of French invasion. Our interpretation is that the Revolution destroyed (the institutional underpinnings of) the power of oligarchies and elites opposed to economic change; combined with the arrival of new economic and industrial opportunities in the second half of the 19th century, this helped pave the way for future economic growth. The evidence does not provide any support for several other views, most notably, that evolved institutions are inherently superior to those 'designed'; that institutions must be 'appropriate' and cannot be 'transplanted'; and that the civil code and other French institutions have adverse economic effects.
    JEL: N23
    Date: 2009–04
  5. By: W. Scott Frame; Lawrence J. White
    Abstract: This paper discusses the technological change and financial innovation that commercial banking has experienced during the past twenty-five years. The paper first describes the role of the financial system in economies and how technological change and financial innovation can improve social welfare. We then survey the literature relating to several specific financial innovations, which we define as new products or services, production processes, or organizational forms. We find that the past quarter century has been a period of substantial change in terms of banking products, services, and production technologies. Moreover, while much effort has been devoted to understanding the characteristics of users and adopters of financial innovations and the attendant welfare implications, we still know little about how and why financial innovations are initially developed. incompl s
    Keywords: technological change, financial innovation, banking CL HG2567 A4A5
    Date: 2009
  6. By: Jesús D. López- Manjón (Department of Business Administration, Universidad Pablo de Olavide); Fernando Gutiérrez Hidalgo (Department of Business Administration, Universidad Pablo de Olavide); Francisco Carrasco Fenech (Department of Business Administration, Universidad Pablo de Olavide)
    Abstract: This paper analyzes the cost calculations in the 13th Century Book of Good Government of a Souk (Zoco), written by Al-Saqati and dealing with the Malaga souk. This helps us to appreciate the historical accounting patrimony of al-Andalus and to consider the influence of religious doctrine on cost procedure. We inquire into the genesis of complex cost accounting techniques by considering their social, political, and cultural inspiration and not their hitherto strictly economic rationality. The study provides evidence of the following peculiarities: the price fixing related to retail commercial activities, aimed to avoid fraud and was in defense of the final consumer, and was above all, supported by a religious motivation.
    Keywords: innovation, imitation, proactivity, risk taking, customer and competitors focus, competitiveness.
    Date: 2009–01
  7. By: Brandon Dupont; Alka Gandhi; Thomas Weiss
    Abstract: There were substantial fluctuations in the numbers of American overseas travelers, especially before World War II. These fluctuations in travel around the robust, long term upward trend are the focus of this paper. We first identify those fluctuations in the raw data and then try to explain the pattern of overseas travel in a quantitative way. As we show, despite the impact of a myriad of episodic events, the fluctuations in travel can be explained to a large extent by changes in the direct price of travel, changes in per capita GDP in the U.S., the extent of travel in the preceding year, and by periods of armed conflict in Europe. We attempt to explain some of the remaining variation for specific episodes in which the actual level of travel differed substantially from the predicted.
    JEL: L83 N11 N12
    Date: 2009–04
  8. By: Philip Brock
    Abstract: This paper provides a narrative account of the 1980s Chilean banking crisis. The Chilean crisis saw the nationalization of the two largest financial conglomerates and resulted in more than half of the financial system’s assets and liabilities falling under direct control of the government. The paper provides details of the bank rescue measures as well as the resolution of the banks' nonperforming debt problem. By providing a detailed chronology of the financial crisis, the paper highlights the evolutionary process that characterized the interventions taken by the Chilean authorities to restore the financial system to solvency. Despite the pessimism that accompanied the early stages of the banking crisis, the fifteen-year process of intervention, restructuring, and recapitalization left the financial system well-positioned to finance Chile’s economic growth, which averaged six percent per year (in real terms) for the 20 years following 1985.
    Date: 2009–04
  9. By: Marcelo Magalhães Godoy (Cedeplar-UFMG); Daniel Henrique Diniz Barbosa (Instituto Federal de Minas Gerais); Lidiany Silva Barbosa (UFRJ)
    Abstract: The issue of politically oriented regional development occupies an important place in the Economic History of Minas Gerais during the republican period. Since the start of the 20th century, and throughout the most important transformative stages of the Brazilian economic system, notably between the 1930s and 1960s, overcoming underdevelopment and the peripheral position of the state has been a priority for the elites of Minas. For a variety of reasons that we will attempt to demonstrate, we understand that it is essential to study the Diagnóstico da Economia Mineira, published in 1968, by the Banco de Desenvolvimento de Minas Gerais (BDMG), if the goal is to understand the vicissitudes of the state’s economic development, especially considering the aforementioned priority. This study emphasizes the meaning of this rich document, especially the long-lived institutional relationships and theoretical matrixes that lent it legitimacy and made it suited it to its time. The text is structured in three coplementary parts: i) description and analysis of the document; ii) brief background of developmentism in Minas Gerais during the republican period; iii) presentation of four case studies about the themes of the Diagnóstico: transportation, electric energy, sugar industry and steel making.
    Keywords: Minas Gerais, História Econômica, desenvolvimento, planejamento, BDMG
    JEL: N26 N46 N56 N66 N76 N96
    Date: 2009–03

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