nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2010‒02‒05
eleven papers chosen by
Bernardo Batiz-Lazo
University of Leicester

  1. South African Agricultural Research and Development: A Century of Change By Liebenberg, Frikkie; Pardey, Philip G.; Kahn, Michael
  2. Inequality as Policy: The United States Since 1979 By John Schmitt
  3. Globalization, Trade & Wages: What Does History tell us about China? By Kris James Mitchener; Se Yan
  4. Patents of Introduction and the Spanish Innovation System By Saiz, J. Patricio
  5. Two Chapters on early history of the Munich Reinsurance Company: The Foundation/ The San Francisco Earthquake By Spree, Reinhard
  6. Volumes of Evidence - Examining Technical Change Last Century Through a New Lens By Michelle Alexopoulos; Jon Cohen
  7. The Prospects for Inter-Urban Travel Demand By Yves Crozet
  8. The problem with economics: naturalism, critique and performativity By Fabian Muniesa
  9. A multi-sectoral approach to the U.S. Great Depression By Pedro S. Amaral; James C. MacGee
  10. Lessons from the U.S. Transport Deregulation Experience for Privatization By Clifford Winston
  11. From the Non-European Tradition to a Variation of Japanese Model of Competitiveness: the Japanese Modern Paper Industry since the 1870s By Takafumi Kurosawa; Tomoko Hashino

  1. By: Liebenberg, Frikkie; Pardey, Philip G.; Kahn, Michael
    Abstract: The 20th Century saw substantive shifts in the structure of agriculture and agricultural production in South Africa. Farm size grew, farm numbers eventually declined, and production increasingly emphasized higher-valued commodities, notably a range of horticultural crops. The real gross value of agricultural output grew steadily (by 3.32 percent per year) from 1910-1981, but declined thereafter (by 0.21 percent per year from 1982-2008). These long-run sectoral changes provide a context to present and assess an entirely new data series on public agricultural R&D (and related regulatory and extension) spending and associated scientist trends. South African agricultural R&D has been affected by a series of major policy changes. These are also documented and discussed here, along with the associated institutional changes regarding the conduct and funding of public agricultural R&D in South Africa. We reveal a number of disturbing trends, including an effective flat lining of the long-run growth in total agricultural R&D spending that took hold in the 1970s, an erratic path of funding per scientist, and a loss of scientific personnel in recent decades. Moreover, South Africa has lost ground relative to its competitors in international commodity markets such as the United States and Australia in terms of the intensity of investment in agricultural R&D. These developments are likely to have long-term, and detrimental, consequences for the productivity performance and competiveness of South African agriculture. They deserve serious policy attention as the 21st Century unfolds, with a firm eye to the long-run given the long lags (often many decades) that typify the relationship between agricultural R&D spending and productivity growth.
    Keywords: Research and Development/Tech Change/Emerging Technologies,
    Date: 2010–01
  2. By: John Schmitt
    Abstract: Since the end of the 1970s, the United States has seen a dramatic increase in economic inequality. While the United States has long been among the most unequal of the world’s rich economies, the economic and social upheaval that began in the 1970s was a striking departure from the movement toward greater equality that began in the Great Depression, continued through World War II, and was a central feature of the first 30 years of the postwar period. This is not due to chance circumstances but is the direct result of a set of policies designed first and foremost to increase inequality.
    Keywords: inequality
    JEL: E E6 E61 E62 E64 E65 E66 H I I3 I38 J J5 J8 J88
    Date: 2009–10
  3. By: Kris James Mitchener; Se Yan
    Abstract: Chinese imports and exports grew rapidly during the first three decades of the twentieth century as China opened up to global trade. Using a new data set on the factor-intensity of traded goods at the industry level, we show that Chinese exports became more unskilled-intensive and imports became more skill-intensive during these three decades. The exogenous shock of World War I dramatically raised the price of Chinese exports, increased the demand for Chinese goods overseas, and increased the demand for unskilled workers producing these goods. These trends continued even after the war ended. We show that the timing of the rise in export prices is consistent with the observed decline in the skill premium in China. The skill-unskilled wage ratio flattened out during the 1910s and then fell by eight percent during the 1920s. We simulate the price shock of World War I using a general equilibrium factor-endowments model of trade and find evidence consistent with the observed fall in the skill premium in China during the 1920s.
    JEL: F15 F33 N25 N75
    Date: 2010–01
  4. By: Saiz, J. Patricio (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid)
    Abstract: From a long-term perspective, technological innovation could have come from local or domestic inventive and research activity, or from the transfer of foreign technology. In reality either option produces similar effects and often it was a combination of both which drove the historical acceleration of the rhythm of innovation and expansion of industry. This was fundamental for Great Britain and its early followers, and even more so for the latecomers and the underdeveloped countries. Spain, for example, suffered from scientific, technological and industrial backwardness which impeded the implementation of a national research and development infrastructure capable of generating competitive inventive activity. However, the national innovation system was designed, from the 18th century onwards, to favour the transfer of technology and human capital from abroad and thus establish the basis of modern economic growth and the process of industrialization. In this paper we will reflect on the design of the Spanish Innovation System, especially in one of its institutional aspects (the patent system), in order to understand the real role and function of a curios legal process the “patent of introduction”, which in practice promoted and permitted anyone to protect foreign third-person technologies in order to implement them locally, providing they were not already established. Although this legal practice represents a very clear declaration of intentions concerning the innovation policy and despite its existence in other patent systems in lagging countries, economic and technology historians have paid little or no attention to the subject. Therefore it is unclear how patents of introduction functioned and what consequences they had on the innovation and industrialization processes, especially in underdeveloped countries such as Spain, which, incredibly, maintained this practice until joining the European Union in 1986. We will attempt to shed light on how patents of introduction were established and how they evolved, the role they played in the promotion of innovation, who used them and how, and the real impact they had. The conclusions point out that, as with protectionism as a commercial policy, forcing national processes of innovation that take advantage of foreign inventions with or without respecting the original inventors rights –as generally occurs with the transfer of technology from abroad- could have positive consequences on the industrialization processes as well as helping lagging countries such as Spain to catch up with modern societies.
    Keywords: Patents of introduction; National innovation system; Spain; Technology transfer.
    JEL: N43 N44 N73 N74 O31 O34 O38
    Date: 2009–08
  5. By: Spree, Reinhard
    Abstract: The Munich Re was founded in 1880 and is from the very start till this day one of the leading insurance companies in the world. Despite its long and successfull existance the company’s history has not been reported yet in a way that fulfilled scientific criteria. This paper can be seen as a first step in this direction. Following a biographical approach the focus will be set on the co-founder and first general director, Carl Thieme, who chaired the company for several decades. The first chapter will outline the foundation of the Munich Re while the second chapter will give an examination of the way the Munich Re dealt with the challenge of the San Francisco earthquake of 1906.
    Keywords: insurance; reinsurance; institutions; globalization; global players; economic success; earthquake; San Francisco; Munich
    JEL: E22 E51 F23 F53 G22 N21 N23
    Date: 2010–01
  6. By: Michelle Alexopoulos; Jon Cohen
    Abstract: Although technical change is central in much of modern economics, traditional measures of it are, for a number of reasons, flawed. We discuss in this paper new indicators based on data drawn from the MARC records of the Library of Congress on the number of new technology titles in various fields published in the United States over the course of the last century. These indicators, we argue, overcome many of the shortcomings associated with patents, research and development expenditures, innovation counts, and productivity figures. We find, among other things, the following: the pattern and nature of technical change described by our indicators is, on the whole, consistent with that of other measures; they represent innovation not diffusion; a strong causal relationship between our indicators and changes in TFP and output per capita; innovations in some sub-groups have had a greater impact on output and productivity than others and, moreover, the key players have changed over time. Our indicators can be used to shed light on number of important issues including the empirical relationship between technology shocks and employment, the role of technology in cross-country productivity differences, and the part played by technological change in growing skills premia in the U.S. during the last few decades.
    Keywords: Business Cycles, Technical change, productivity, measurement
    JEL: E3 O3 O4
    Date: 2010–01–26
  7. By: Yves Crozet
    Abstract: The great difference between our journeys and activity schedules and those of our forebears lies in the much longer distances we travel. By road, and even more so by rail and air, nowadays we can cover hundreds or even thousands of miles in a few hours. Inter-urban mobility is directly affected by these developments. Where international travel by coach and sailing ship used to take weeks, and intercontinental journeys sometimes even longer, we now count the time in hours. The transport revolution has played a major part in the economic history of the last two centuries (Niveau and Crozet, 2000), but it must be emphasized that the change has been gradual. Over two hundred years have passed between the stage-coach and the high-speed train, the clipper and the jet, during which technological progress and the higher speeds it enables have spread relatively slowly. Even with key technological revolutions like the railways, the automobile and the aeroplane, it took several decades for them to become available to the population at large. From this slow percolation of technological progress into the way we live has arisen the idea that steadily increasing mobility is a structural given of modern society. Further, faster seems to have become the general rule, to such an extent that even space travel, so we are told, will become more widely available in the relatively near future. A few very wealthy people have already become the world's first space tourists. It is the self-evident nature of this long-term trend towards increased mobility that we wish to examine in this report, since a number of factors could well undermine the relatively classic assumption that past trends will continue into the future.
    Date: 2009–12
  8. By: Fabian Muniesa (Centre de Sociologie de l'Innovation, Mines ParisTech)
    Abstract: Reviews debates on the performativity of economics from the vantage point of a general anthropology of modern economic reason.
    Keywords: Performativity, naturalism, critique, economics, science studies, anthropology, thought experiments
    JEL: A10 A11 A12 A13 A14 B00 B40 Z13
    Date: 2010–01
  9. By: Pedro S. Amaral; James C. MacGee
    Abstract: We document sectoral differences in changes in output, hours worked, prices, and nominal wages in the United States during the Great Depression. We explore whether contractionary monetary shocks combined with different degrees of nominal wage frictions across sectors are consistent with both sectoral as well as aggregate facts. To do so, we construct a two-sector model where goods from each sector are used as intermediates to produce the sectoral goods that in turn produce final output. One sector is assumed to have flexible nominal wages, while nominal wages in the other sector are set using Taylor contracts. We calibrate the model to the U.S. economy in 1929, and then feed in monetary shocks estimated from the data. We find that while the model can qualitatively replicate the key sectoral facts, it can account for less than a third of the decline in aggregate output. This decline in output is roughly half as large as the one implied by a one-sector model. Alternatively, if wages are set using Calvo-type contracts, the decline in output is even smaller.
    Keywords: Depressions ; Wages ; Prices
    Date: 2009
  10. By: Clifford Winston
    Abstract: The purpose of this paper is to suggest how the U.S. experience with deregulating its intercity transportation system can identify important considerations for all countries that wish to pursue privatization. Transportation deregulation in the United States gave private railroad, trucking, bus, and airline companies the freedom to set prices, choose which markets to serve, and what level of service to provide. Because U.S. firms were saddled with inefficiencies that developed over decades of regulation, their adjustment to deregulation has been difficult and time consuming. Nonetheless, deregulation has succeeded to a notable extent in the short run and could provide even greater benefits in the long run.
    Date: 2009–12
  11. By: Takafumi Kurosawa (Associate Professor of Graduate School of Economics, Kyoto University); Tomoko Hashino (Associate Professor of Graduate School of Economics, Kobe University)
    Date: 2010–01

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