New Economics Papers
on Business, Economic and Financial History
Issue of 2010‒08‒06
fifteen papers chosen by

  1. Poverty, Population, Inequality, and Development in Historical Perspective By Alberto Chilosi
  2. Econometric Studies of Business Cycles in the History of Econometrics By Duo Qin
  3. Economics for the Masses : The Visual Display of Economic Knoledge in the United Staes (1921-1945) By Giraud Yann; Charles Loic
  4. Consumer specialization and the Romantic transformation of the British Grand Tour of Europe By Andreas Chai
  5. Back to the roots: On the origins of the Fed's independence By Farvaque, Etienne
  6. Why Do Cooperatives Fail? Big versus Small in Ghanaian Cocoa Producers’ Societies, 1930-36 By Chiara Cazzuffi; Alexander Moradi
  7. An alternative perspective on South Africa’s public debt, 1962-1994 By Estian Calitz; Stan du Plessis; Krige Siebrits
  8. Economic Crisis and Economic Theory By Mark Weder
  9. Monetary and fiscal policies coordination - Pakistan's experience By Arby, Muhammad Farooq; Hanif , Muhammad Nadeem
  10. The Porter Hypothesis at 20: can Environmental Regulation Enhance Innovation and Competitiveness? By Stefan AMBEC; Mark A. COHEN; Stewart ELGIE; Paul LANOIE
  11. Advancing Structural Reforms in OECD Countries: Lessons from Twenty Case Studies By William Tompson; Thai-Thanh Dang
  12. "Croatian Wage Inequality and Wage Differentials, 1970-2008: Measurement and Determinants" By Ivo Bicanic; Saul D. Hoffman; Oriana Vukoja
  13. Post Crisis Policy: Some Reflections of a Keynesian Economist By Karl Aiginger
  14. Aproximações de um olhar foucauldiano sobre o institucionalismo de Thorstein Veblen By Marco Antonio Ribas Cavalieri; Iara Vigo de Lima
  15. 戦間期日本における対植民地証券投資の一側面 : 第5回・第6回朝鮮鉄道会社債を中心に By 矢島, 桂

  1. By: Alberto Chilosi
    Abstract: Seen in historical perspective the main economic predicaments of the present world (such as poverty, inequality, backwawardness) appear in a somewhat different light than in many current discussions, especially by sociologists, radical economists and political scientits. In the present paper the achievements of the modern age, and in particular of the post-World War II period, are considered in the perspective of economic and demographic history, and in their connection with the contemporary system of production and of international relations. Some considerations concerning future possible developments conclude the paper.
    Keywords: poverty, population, development, distribution, inequality, extraction rate, international relations, globalization, transition, colonialism, slavery, Zen economy, migration, economic consequences of war and peace, atomic warfare
    JEL: P0 O10 N0
    Date: 2010–06–02
  2. By: Duo Qin (Queen Mary, University of London)
    Abstract: This study examines the evolution of econometric research in business cycle analysis during the 1960-90 period. It shows how the research was dominated by an assimilation of the tradition of NBER business cycle analysis by the Haavelmo-Cowles Commission approach, catalysed by time-series statistical methods. Methodological consequences of the assimilation are critically evaluated in light of the meagre achievement of the research in predicting the current global recession.
    Keywords: Business cycles, NBER, Forecasting
    JEL: B23
    Date: 2010–07
  3. By: Giraud Yann; Charles Loic (THEMA, Universite de Cergy-Pontoise; EconomiX, Universite de Reims and INED)
    Abstract: The rise of visual representation in economics textbooks after WWII is one of the main features of contemporary economics. In this paper, we argue that this development has been preceded by a no less significant rise of visual representation in the larger literature devoted to social and scientific issues, including economic textbooks for non-economists as well as newspapers and magazines. During the interwar era, editors, propagandists and social scientists altogether encouraged the use of visual language as the main vehicle to spread information and opinions about the economy to a larger audience. These new ways of visualizing social facts, which most notably helped shape the understanding of economic issues by various audiences during the years of the Great Depression, were also conceived by their inventors as alternative ways of practicing economics: in opposition to the abstraction of “neoclassical” economics, these authors wanted to use visual representation as a way to emphasize the human character of the discipline and did not accept the strict distinction between the creation and the diffusion of economic knowledge. We explore different yet related aspects of these developments by studying the use of visual language in economics textbooks intended for non-specialists, in periodicals such as the Survey, a monthly magazine intended for an audience of social workers, the Americanization of Otto Neurath's pictorial statistics and finally the use of those visual representations by various state departments and administrations under Roosevelt's legislature (including the much-commented Historical Section of the Farm Security Administration). We show how visualizations that have been created in opposition to neoclassical economics have lost most of their theoretical content when used widely for policy purposes while being simultaneously integrated into the larger American culture. It is our claim that those issues, which are familiar to those involved in cultural and visual studies, are also of crucial importance to apprehend the later developments of modern economics.
    Keywords: Visualization, economocs, American Economy, Otto Neurath, Rexford Tugwell, Roosevelt, Roy Stryker, Photographs, Pictorial Statistics
    JEL: B20 A14
    Date: 2010
  4. By: Andreas Chai
    Abstract: This paper posits that significant changes in 19th century British recreational travel patterns resulted from a change in the manner in which tourists used entertaining stimuli in order to attain pleasure. Consumers no longer merely viewed arousing stimuli, but attempted to use them to produce emotional states of being which they could partially modify to intensify pleasurable feelings (Damasio 2003). The impetus for this modification stemmed from an increasing awareness that emotional responses could be to some degree self-cultivated, as embodied in the Romantic ethos that become popular at the time via the emergence of the paperback novel and magazine industry (Campbell 1987). By learning how to manipulate and modify mental images in a way that may not necessarily correspond with objective reality, Romantic tourists learned to elicit pleasure through engaging of their imagination. Such a change in the mode of pleasure seeking had important long run economic consequences for tourist regions throughout the European continent.
    Keywords: Consumer specialization; Emotions; Tourism; Romanticism Length 27 pages
    JEL: D11 D13 O12 O40
    Date: 2010–07
  5. By: Farvaque, Etienne
    Abstract: This note considers the foundations of the Federal Reserve Board's independence. Its origins are shown to reside in the American political philosophy, under which independence is an essential working condition for a perennial democracy.
    Keywords: Federal Reserve Board; independence; constitution.
    JEL: E58 N20
    Date: 2010–03
  6. By: Chiara Cazzuffi; Alexander Moradi
    Abstract: Using a complete panel of Ghanaian cocoa producers’ societies in the 1930s, we investigate whether group interaction problems threatened i) capital accumulation, ii) cocoa sales and iii) cooperative survival as membership size increased. We find evidence of group interaction problems. The net effect, however, is positive indicating gains from economies of scale as cooperatives expanded their membership.
    Keywords: cooperatives, firm survival, collective action problems, Ghana
    JEL: J54 N57 Q13
    Date: 2010
  7. By: Estian Calitz (Department of Economics, University of Stellenbosch); Stan du Plessis (Department of Economics, University of Stellenbosch); Krige Siebrits (Department of Economics, University of Stellenbosch)
    Abstract: The history of public debt reflects the cumulative effect of fiscal decisions and real outcomes in the economy. In the South African case the published record on public debt distorts the historical perspective on the associated fiscal decisions. This note shows the impact of adjusting the South African public debt on an accrual basis to take account of two major obligations assumed in the first half of the 1990s, namely actuarial pension fund deficits and government debt of the apartheid homelands. The adjusted series is less volatile and rose less steeply between 1989 and 1996 than the official, cash based debt series. Failing to account for the evolution of these obligations exaggerates the impression of weak fiscal discipline in the early nineties and exemplary fiscal prudence in preceding decades.
    Keywords: South African public debt, fiscal discipline, accrual classification, pension fund deficits, sub-national debt
    JEL: H62 H63 G23
    Date: 2010
  8. By: Mark Weder
    Abstract: Two dynamic general equilibrium economies compete in explain?ing the United States'interwar business cycles. Despite the demand driven contender's slight advantages, the results remain too close to call a clear winner.
    Keywords: Great Depression, Dynamic General Equilibrium.
    JEL: E32 N12
    Date: 2010–07–30
  9. By: Arby, Muhammad Farooq; Hanif , Muhammad Nadeem
    Abstract: The paper explores how the monetary and fiscal policies have coordinated with each other in Pakistan. It argues that monetary and fiscal policies have been executed independently throughout the study period that is 1964-65 to 2008-09 and there have been very few instances of coordination between the two policies while addressing prevailing economic conditions. The paper does not find any difference between the behavior of monetary and fiscal policies before and after the establishment of Monetary and Fiscal Policies Coordination Board in 1994. Whatever instances of coordination were found were clustered in military regimes; which may be one of the reasons of macroeconomic stability in such regimes.
    Keywords: Monetary Policy; Fiscal Policy;
    JEL: H30 E50 E61
    Date: 2010
  10. By: Stefan AMBEC; Mark A. COHEN; Stewart ELGIE; Paul LANOIE (IEA, HEC Montréal)
    Abstract: Twenty years ago, Harvard Business School economist and strategy professor Michael Porter stood conventional wisdom about the impact of environmental regulation on business on its head by declaring that well designed regulation could actually enhance competitiveness. The traditional view of environmental regulation held by virtually all economists until that time was that requiring firms to reduce an externality like pollution necessarily restricted their options and thus by definition reduced their profits. After all, if there are profitable opportunities to reduce pollution, profit maximizing firms would already be taking advantage of those opportunities. Over the past 20 years, much has been written about what has since become known simply as the Porter Hypothesis (“PH”). Yet, even today, there is conflicting evidence, alternative theories that might explain the PH, and oftentimes a misunderstanding of what the PH does and does not say. This paper provides an overview of the key theoretical and empirical insights on the PH to date, draw policy implications from these insights, and sketches out major research themes going forward.
    Keywords: Porter Hypothesis, environmental policy, innovation, performance.
    Date: 2010–07
  11. By: William Tompson; Thai-Thanh Dang
    Abstract: This paper presents in summary form the findings that emerge from a study of 20 structural reform episodes in 10 OECD countries. The study’s principal messages may be summarised as follows. First, it pays to have an electoral mandate for reform. Secondly, major reforms should be accompanied by consistent co-ordinated efforts to persuade voters and stakeholders of the need for reform and, in particular, to communicate the costs of non-reform. This communications challenge points to the need for policy design to be underpinned by solid research and analysis, which serves both to improve the quality of policy and to enhance prospects for reform adoption. Partly for these reasons, many of the least successful reform attempts were undertaken in haste, often in response to immediate pressures. The cohesion of the government is also critical: if the government is not united around the policy, it will send out mixed messages, and opponents will exploit its divisions. Finally, while much of the political economy literature focuses on agency and the interplay of interests, the condition of the policy regime to be reformed also matters. This paper relates to The Political Economy of Reform: Lessons from Pensions, Product Markets and Labour Markets in Ten OECD Countries, OECD, Paris, 2009,,3343,en_2649_33733_43756114_1_1_1_1,00.html<P>Faire avancer les réformes structurelles dans les pays de l’OCDE : Enseignements de vingt études de cas<BR>Cet article présente un resumé des résultats qui emergent d’une analyse de vingt études de cas de réforme structurelle dans 10 pays-membres de l’OCDE. On peut résumer comme suit les principaux messages de cette étude. Premièrement, un mandat électoral en vue de réformes est extrêmement utile. Deuxièmement, les grandes réformes doivent se doubler d’une action coordonnée cohérente en vue de persuader les électeurs et les autres parties prenantes de la nécessité d’une réforme et, plus particulièrement, de faire connaître les coûts de la non-réforme. Ce problème de communication souligne la nécessité de recherches et d’analyses solides pour une conception efficace des politiques, afin d’améliorer à la fois la qualité des mesures et les perspectives d’adoption des réformes. En partie pour ces raisons, un grand nombre des réformes les moins réussies ont été entreprises à la hâte, souvent en réaction aux pressions immédiates. La cohésion gouvernementale est elle aussi cruciale : si le gouvernement n’est pas uni autour de la politique souhaitée, il adressera des messages ambigus et l’opposition exploitera ses divisions . Enfin, s’il est vrai qu’une bonne partie des ouvrages d’économie politique sont centrés sur les relations de mandat et l’interaction des intérêts, la situation du régime à réformer joue également un grand rôle. Ce document se rapporte à L’économie politique de la réforme : Retraites, emplois et déréglementation dans dix pays de l’OCDE, OCDE, Paris, 2009, (,3343,en_2649 _33733_43756114_1_1_1_1,00.html)
    Keywords: pensions, regulation, product markets, political economy, reforms, labour market, réglementation, marché du travail, retraites, marchés de produits, économie politique, réformes
    JEL: D7 H55 J4 J5 N4 P16
    Date: 2010–04–19
  12. By: Ivo Bicanic (Department of Economics,University of Zagreb); Saul D. Hoffman (Department of Economics,University of Delaware); Oriana Vukoja (Department of Economics,University of Zagreb)
    Abstract: We use newly-available data on income by educational and vocational attainment and grouped income-interval data to examine wage inequality and wage differentials in Croatia between 1970 and 2008. This is a time period during which Croatia experienced enormous institutional and structural change, including the fall of socialism, hyperinflation, the Homeland war and the creation of sovereign Croatia. We construct both Gini and Theil measures of inequality, using grouped data. We find a general compression of earnings differences by educational and vocational attainment, but with a slight increase in the capitalist period post-1990. The income interval data shows a clearer pattern of a secular increase in inequality that is sharper in the capitalist period. We also examine within-industry inequality to see whether industries that experienced stronger structural changes also experienced a greater increase in inequality. Our evidence on this is mixed.
    Keywords: Croatia, Transition Economy Labor Markets, Inequality, Gini coefficient, Theil Index
    JEL: J3 P2 P23
    Date: 2010
  13. By: Karl Aiginger (WIFO)
    Abstract: This paper compares the depth and length of the recent crisis with the Great Depression in the 1930s. It claims that economic policy played a crucial role in shortening and curtailing the recent crisis. We analyse which policies were applied during the recent crisis and which measures worked. We know that policies relying on large infrastructure projects inherently involve an implementation lag. These lags have been very high in the recent crisis and some expenditure planned will maybe never be spent. We therefore suggest implementing a leakage rate for government expenditure programs which represents the part of intended public expenditures not spent in the first twelve months after the program is set into action. It might be higher than the savings rate out of a tax cut. Furthermore, exit strategies should ideally cut expenditure to the same extent as the increase in government spending during the crisis had been, so that sooner or later tax rates and debt rates may return to pre crisis levels. The core of the Keynesian policy recommendation is to raise expenditure in the crisis but to achieve a balanced budget over a full cycle. If expenditure is not cut after the crisis tax and/or debt rates will increase after each downturn and the basis for any Keynesian policy in the next crisis will be eroded. This does not preclude that it might be useful in the exit phase to change the tax structure in order to lower taxes on labour, specifically for low wages, while increasing taxes on financial transactions, carbon dioxide emissions, capital gains or property. This would lower unemployment and boost demand in economies with tendencies to underconsume.
    Keywords: financial crisis, business cycle, stabilisation policy, resilience
    Date: 2010–05–11
  14. By: Marco Antonio Ribas Cavalieri (Department of Economics, Universidade Federal do Paraná); Iara Vigo de Lima (Department of Economics, Universidade Federal do Paraná)
    Abstract: Thorstein Veblen (1857-1929), considered the first institutionalist author, tried to formulate, in the passage of the 19th century to the 20th, an original system of political economy that was alternative to classical, neoclassical, historicist and marxist thoughts. In this paper, this system of political economy is considered from the Michel Foucault’s (1926-1984) archeology of knowledge perspective. Hence, the paper has two more specific objectives. First, to expose how Foucault’s archeology of knowledge can be used to the study of an original system of political economy. Second, to show that the Veblenian system can be viewed as an instance, incipient and hesitant as it is, in the direction of a surpassing of what Foucault named modern episteme.
    Keywords: Thorstein Veblen, Michel Foucault, history of economic thought, archeology of knowledge, institutionalism
    JEL: B15 B49 B31
    Date: 2010
  15. By: 矢島, 桂
    Abstract: The object of this paper is to attempt an analysis of the process in which securities companies came to underwrite colonial securities and the place of them in the capital market in interwar Japan, focusing on the Chosen Railway bonds. The Chosen Railway, by issuing bonds, was able to pay back the loans to colonial banks. While securities companies underwrote them, colonial banks could call in the loans from the Chosen Railway. The 5th and 6th bonds were profitable for Yamaichi Securities Company as an underwriter and for investors who could receive interests secured by the colonial government grants. The investors consisted of mainly the zaibatsu and financial institutions in the provinces.
    Date: 2010–07

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