New Economics Papers
on Business, Economic and Financial History
Issue of 2011‒01‒23
fourteen papers chosen by

  1. Great War, Civil War, and Recovery: Russia’National Income, 1913 to 1928 By Andrei Markevich; Mark Harrison
  2. La población y el producto cerealista en Guadalajara en la edad moderna By Grupo Complutense de Historia Económica Moderna
  3. Metalistas x Papelistas: Origens Teóricas e Antecedentes do Debate entre Monetaristas e Desenvolvimentistas By Pedro Cezar Dutra Fonseca; Maria de Lourdes Rollemberg Mollo
  4. Giacomo Becattini and the Marshall's method. A Schumpeterian approach By Joan Trullén
  5. Long Run Dynamics of Energy-Related External Costs By Roger Fouquet
  6. Colonial Innovation System, Sub-Imperial Institutions and the Creole Elite in Nineteenth-Century Cuba By Fernández de Pinedo, Nadia; Pretel, David; Saiz, J. Patricio
  7. Citizenship in Britain and Europe: some missing links in T.H. Marshall's theory of rights By Harris, Jose
  8. The Early Diffusion of the Steam Engine in Britain, 1700-1800. A Reappraisal By Alessandro Nuvolari; Bart Verspagen; Nick Von Tunzelmann
  9. Immigration and the origins of regional inequality: Government-sponsored European migration to Southern Brazil before World War I By de Carvalho Filho, Irineu; Monasterio, Leonardo M
  10. History Matters: China and Global Governance By Wendy Dobson
  11. Cultural Diversity and Economic Growth: Evidence from the US during the Age of Mass Migration By Philipp Ager; Markus Brückner
  12. The Institutional Economics of Reflexive Governance in the Area of Utility Regulation By Eric Brousseau; Jean-Michel Glachant
  13. Institutional Entrepreneurship: An Introduction By Henrekson, Magnus; Sanandaji, Tino
  14. A History-Friendly Model of the Evolution of the Pharmaceutical Industry: Technological Regimes and Demand Structure By Christian Garavaglia; Franco Malerba; Luigi Orsenigo; Michele Pezzoni

  1. By: Andrei Markevich (New Economic School (Moscow), University of Warwick); Mark Harrison (University of Warwick, University of Birmingham, Hoover Institution on War, Revolution, and Peace, Stanford University)
    Abstract: The last remaining gap in the national accounts of Russia and the USSR in the twentieth century, 1913 to 1928, includes the Great War, the Civil War, and postwar recovery. Filling this gap, we find that the Russian economy did somewhat better in the Great War than was previously thought; in the Civil War it did correspondingly worse; war losses persisted into peacetime, and were not fully restored under the New Economic Policy. We compare this experience across regions and over time. The Great War and Civil War produced the deepest economic trauma of Russia’s troubled twentieth century.
    Keywords: Civil War, GDP, Russia, Soviet Union, World War I
    JEL: E20 N14 N44 O52
    Date: 2010–11
  2. By: Grupo Complutense de Historia Económica Moderna (Universidad Computense)
    Abstract: The aim of this paper is twofold. First, it quantifies and analyzes the demographic evolution of the province of Guadalajara during the Early Modern Age and the first decades of the Modern Age. Second, it estimates the cereal production in two specific areas, La Campiña and La Sierra, between the end of the 16th century and the second half of the 18th century. The main primary sources used here are the baptisms registers of 47 towns and villages, several population censuses, and the tithes of the archpriesthood of Sigüenza and five archpriesthoods that belonged to the archbishopric of Toledo. It is concluded that: a) from the end of the 16th century onwards, population stagnation characterized the Guadalajara region; b) we find sharp contrasts between the different demographic path followed by the province areas under consideration; c) apart from the first half of the 17th century, when its fall was higher, the cereal production followed the same trend than population; and d) after 1650 the per capita cereal production began to recover, although in La Campiña the explanation lays on its slow growth in population. (Main text in Spanish)
    Keywords: population; baptisms index; census; Guadalajara; early modern age.
    JEL: N33 N53 N93
    Date: 2012–10
  3. By: Pedro Cezar Dutra Fonseca (Departamento de Economia da Universidade Federal do Rio Grande do Sul - UFRGS); Maria de Lourdes Rollemberg Mollo (Departamento de Economia (Department of Economics) Faculdade de Economia, Administração, Contabilidade e Ciência da Informação e Documentação (FACE) (Faculty of Economics, Administration, Accounting and Information Science) Universidade de Brasília)
    Abstract: The paper analyzes the debate between mettalism and “papelismo” which took place in Brazil in the second half of the 19th century and advocates that the latter was one of the currents that contributed for the genesis of developmentalism. In order to do so, it reviews the monetary controversies in England since the beginning of that century. Based on them, it identifies the theoretical origins of the Brazilian debate, highlighting the issue that refers to the neutrality or non-neutrality of money. Next, it shows how this question was adapted to the peculiarities of the Brazilian economy, emphasizing the “papelistas”’ option for growth, breaking up with the orthodoxy of that time. The influence upon the fledgeling developmentalism is empirically studied based on the speeches of Getulio Vargas, since he was the central character of the developmentalist State that was central to the Brazilian historical experience post-1930.
    Keywords: Brazilian economy, Latin-American economic thought, economic development, bullionism, monetary controversies.
    Date: 2011–01
  4. By: Joan Trullén (Institut d'Estudis Regionals i Metropolitans de Barcelona)
    Abstract: The studies of Giacomo Becattini concerning the notion of the "Marshallian industrial district" have led a revolution in the field of economic development around the world. The paper offers an interpretation of the methodology adopted by Becattini. The roots are clearly Marshallian. Becattini proposes a return to the economy as a complex social science that operates in historical time. We adopt a Schumpeterian approach to the method in economic analysis in order to highlight the similarities between the Marshall and Becattini’s approach. Finally the paper uses the distinction between logical time, real time and historical time which enable us to study the “localized” economic process in a Becattinian way.
    Keywords: industrial district, Marshallian industrial district, methodology of economics, Schumpeter's economic analysis, historical time, economic process
    JEL: B31 B41
    Date: 2010–12
  5. By: Roger Fouquet
    Abstract: This paper considers how external costs can change through time and in relation to prices and consumption. In this paper, one of the proposed features of the long run dynamics of external costs is a process of externalising the costs of production and consumption. That is, as prices of goods fall and consumption increases, a rising share of the social costs will be passed on to the wider society. This proposition is examined empirically by looking at a key period in the history of energy. After a period of declining coal prices and soaring consumption which fuelled the Second Industrial Revolution, nineteenth century British economy was externalising the social costs of energy production and consumption on a massive scale (at its peak, an estimated 70% of the average social costs of coal were externalised, and were imposing damages equivalent to 17.5% of GDP).This case shows that, in periods of rapidly declining prices and/or high economic growth, average and marginal external costs can soar in relative and absolute terms, imposing a huge burden on the wider society.
    Keywords: External costs; Energy; Coal; Historical; Long Run; Air Pollution; Mining
    Date: 2011–01
  6. By: Fernández de Pinedo, Nadia (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid); Pretel, David (Trinity Hall. University of Cambridge); Saiz, J. Patricio (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid)
    Abstract: This article examines the relationship between colonialism and technology transfer via the study of nineteenth century Cuban institutions dedicated to the stimulation of innovative activity, particularly the patent system. Preliminary findings suggest three noteworthy claims. First, during the nineteenth century Cuban Creole elites set up a ‘Colonial Innovation System’ made up of ‘sub-imperial’ institutions autonomously administered in a context where rival Atlantic empires functioned as a ‘shadow’ economic metropolis of Cuba. Second, despite having the same patent laws as metropolitan Spain, Cuban sugar elites obtained practical control and management of the patent sub-institution on the island. Third, this achievement led to an autonomous functioning of the patent system in Cuba that allowed sugar-mill owners to participate actively in the global networks of technological exchange and to generate higher levels of patent activity than in metropolitan Spain.
    Keywords: patents, sugar industry, colonialism, sub-imperial institutions, technology transfer.
    JEL: N46 N76 O31 O34 O38 O54
    Date: 2010–10
  7. By: Harris, Jose
    Abstract: T.H. Marshall's reputation as an historian, social theorist, and practical interpreter of ideas about citizenship and welfare rights has probably never been higher than at the present time. Whether or not T. H. Marshall was 'right' or 'wrong' in his analysis of the questions raised in Citizenship and Social Class (1949), he has come to be seen as a key figure in sparking-off and mediating far-reaching new approaches to ideas about social welfare policy, citizenship laws, and fundamental social rights. Full discussion of Marshall's influence opens up some very large questions, going far beyond the scope of this paper. Here I want to focus on some curious historical gaps and unanswered questions in Marshalls Citizenship and Social Class-gaps that relate both to Marshall's account of the longer-term historical past and to contemporary movements in his own times. First, in a British context, I am puzzled by his narrative of the long-term evolution of citizenship and welfare rights, as these had developed from the 'early-modern' period through into the twentieth-century. And, secondly, in a wider European context, I am equally if not more puzzled by Marshall's relation to the massive debates about citizenship and rights of all kinds that was going on in Europe during the mid-to-late-1940s, at exactly the moment when he was preparing his Cambridge lectures on those same themes. -- Der Ruf von T.H. Marshall als Historiker, Gesellschaftstheoretiker und Deuter von Ideen über Bürgerrechte und soziale Klassen (1949) war wahrscheinlich nie besser als heute. Ob Marshalls Analyse in Bürgerrechte und soziale Klassen nun zutrifft oder nicht, er wird heute als einer der zentralen Denker gesehen, die unsere Ideen von Sozialpolitik, Bürgerschaft und grundlegenden sozialen Rechten angestoßen und gebündelt haben. Eine vollständige Diskussion von Marshalls Einfluss führte in eine Vielzahl großer Fragen hinein, die weit über dieses Papier hinausgehen würde. Hier möchte ich mich auf verschiedene auffällige historische Lücken und offene Fragen konzentrieren, die sich aus Bürgerrechte und soziale Klassen ergeben. Diese Lücken beziehen sich auf Marshalls Darstellung der langen historischen Wellen und auf die sozialen Bewegungen in seiner Gegenwart, also um 1949. Erstens, im britischen Zusammenhang gibt mir seine Erzählung der Langfristentwicklung von Bürgerrechten und sozialen Klassen wie sie sich von der frühen Neuzeit bis ins 20. Jahrhundert entwickelt haben, Fragen auf. Zweitens, in einem breiteren europäischen Zusammenhang frage ich besonders nach Marshalls Beziehungen zu den umfangreichen Diskussionen über Bürgerschaft und weitere Rechte aller Art, die im Europa der zweiten Hälfte der 40er Jahre stattgefunden haben, also genau zu dem Zeitpunkt als er seine Vorträge in Cambridge über diese Themen vorbereitete.
    Date: 2010
  8. By: Alessandro Nuvolari; Bart Verspagen; Nick Von Tunzelmann
    Abstract: We examine the diffusion of steam technology across British counties during the eighteenth century. First, we provide new estimates for the regional variations in the timing, pace and extent of usage of steam engines. Our main data source is an updated version of the list of steam engines erected in Britain during the eighteenth century originally compiled by Kanefsky and Robey (1980). Following a rather established approach for analysing the diffusion of new technologies we fit S-shaped growth functions to the data on the numbers of steam engines installed in each county. In this way, we are able to provide a comprehensive appraisal of the relative speed of the diffusion process in different counties. Second, in order to assess the relative importance of the variables shaping the diffusion of steam power technology, we study the relationship between the number of steam engines installed in each county with of localization factors such as coal prices, availability of water sites, number of textile mills and number of blast furnaces.
    Keywords: Steam Engine, Britain, Industrial Revolution, Diffusion of innovations
    JEL: N73 O14 O33
    Date: 2010–01–11
  9. By: de Carvalho Filho, Irineu; Monasterio, Leonardo M
    Abstract: This paper studies the long-term consequences of the government-sponsored programs of European immigration to Southern Brazil before the Great War. We find that the municipalities closer to the original sites of nineteenth century government sponsored settlements (colônias) have higher per capita income, less poverty and dependence on Bolsa Família cash transfers, better health and education outcomes; and for the areas close to German colonies, also less inequality of income and educational outcomes than otherwise. Since that is a reduced form relationship, we then attempt to identify the relative importance of more egalitarian landholdings and higher initial human capital in determining those outcomes. Our findings are suggestive that more egalitarian land distribution played a more important role than higher initial human capital in achieving the good outcomes associated with closeness to a colônia.
    Keywords: Brazil; Migration; Rio Grande do Sul; German migration; Italian migration; New World; Land distribution; Human capital; Economic history of Latin America
    JEL: F22 N3 O15
    Date: 2011–01–10
  10. By: Wendy Dobson (University of Toronto)
    Abstract: This paper focuses on the two-way relationship between China and the international economic system. China’s embrace of the global institutions and their rules and norms helped guide its spectacular economic growth and integration into the world economy. China’s impact on the global economic order is still an open question, however. Its sheer size and dynamism makes it a force to be reckoned with. So far its influence has been largely constructive but recent signs of assertiveness raise questions about the future. History matters to the answer. Memories of both historical pre-eminence and humiliation drive nationalism and assertiveness at the same time that China identifies with developing countries as a counterbalance rather than as a leader or enforcer of the global norms and rules. The paper evaluates China’s role in the regional and global economic institutions by applying this criterion of economic cooperation: is China willing to modify national policies in recognition of international economic interdependence? The evidence presented is mixed reflecting the complexities of China’s modernization and re-emergence. China actively supports the order in some forums, shows passivity in others yet in still others increasingly asserts its own interests regardless of the global rules. The paper draws conclusions and future implications of this new ‘normal’.
    Date: 2011–01
  11. By: Philipp Ager (Universitat Pompeu Fabra); Markus Brückner (School of Economics, University of Adelaide)
    Abstract: We exploit the large inflow of immigrants to the US during the 1870-1920 period to examine the effects that changes in the cultural composition of the population of US counties had on output growth. We construct measures of fractionalization and polarization to distinguish between the different effects of cultural diversity. Our main finding is that increases in cultural fractionalization significantly increased output, while increases in cultural polarization significantly decreased output. We address the issue of identifying the causal effect of cultural diversity on output growth using the supply-push component of immigrant inflows as an instrumental variable.
    Keywords: cultural diversity, economic growth, historical development, immigration
    JEL: O1 Z1
    Date: 2011–01
  12. By: Eric Brousseau; Jean-Michel Glachant
    Abstract: Regulation of utilities in the XXI Century is challenged by the fast pace of change notably the acceleration of innovation, the restructuring of industry as sets of modular chains and the spreading of new information and communication technology. Living in this world of rapid and renewed changes regulators are also challenged by the basic characteristics of their institutional embeddedness. In the real world, far from being the alpha and the omega of regulation, regulators only act in a multilevel and multichannel frame of regulatory institutions. However regulators can bring a core piece of "reflexive governance" to favour the new industry and institutions' changes. It is by building "knowledge platforms" on an "open forum" model.
    Keywords: Reflexive Governance; Regulation; Knowledge Platform; Open Forum; Innovation
    Date: 2010–12–09
  13. By: Henrekson, Magnus (Research Institute of Industrial Economics (IFN)); Sanandaji, Tino (Research Institute of Industrial Economics (IFN))
    Abstract: In this introductory chapter to a collective volume,* we build on Baumol’s (1990) framework to categorize, catalog, and classify the budding research field that explores the interplay between institutions and entrepreneurship. Institutions channel entrepreneurial supply into productive or unproductive activities, which likely accounts for a great deal of the disparate economic development of nations. What’s more, entrepreneurship is not only influenced by institutions—entrepreneurs often shape institutions themselves. Entrepreneurship abiding by existing institutions is occasionally disruptive enough to challenge the foundations of prevailing institutions. Entrepreneurs also have the opportunity to evade institutions, which tends to undermine the effectiveness of the institutions in question, or cause them to change for the better. Lastly, entrepreneurs can directly alter institutions through innovative political entrepreneurship. Similar to business entrepreneurship, innovative political activity can be either productive or unproductive, depending on the entrepreneurs’ incentives.
    Keywords: Entrepreneurship; Innovation; Institutions; Property rights; Regulation; Self-employment
    JEL: H32 L50 M13 O31 P14
    Date: 2010–10–07
  14. By: Christian Garavaglia (University of Milano-Bicocca, Faculty of Statistics - KITeS, Bocconi University, Milan, Italy); Franco Malerba (KITeS, Bocconi University, Milan, Italy - Bocconi University, Department of Economics); Luigi Orsenigo (KITeS, Bocconi University, Milan, Italy - DIMI, University of Brescia); Michele Pezzoni (KITeS, Bocconi University, Milan, Italy - DIMI, University of Brescia)
    Abstract: This paper examines how the nature of the technological regime governing innovative activities and the structure of demand interact in determining market structure, with specific reference to the pharmaceutical industry. The key question concerns the observation that - despite high degrees of R&Dand marketing-intensity - concentration has been consistently low during the whole evolution of the industry. Standard explanations of this phenomenon refer to the random nature of the innovative process, the patterns of imitation and the fragmented nature of the market into multiple, independent submarkets. We delve deeper into this issue by using an improved modified version of our previous “history-friendly” model of the evolution of pharmaceuticals. Thus, we explore how changes in the technological regime and/or in the structure of demand may generate or not substantially higher degrees of concentration. The main results are that, while technological regimes remain fundamental determinants of the patterns of innovation, demand structure plays indeed a crucial role in preventing the emergence of concentration through a partially endogenous process of discovery of new submarkets. However, it is not simply market fragmentation as such that produces this result, but rather the entity of the “prize” that innovators can gain relative to the overall size of the market. Similarities and differences with other approaches are also discussed.
    Keywords: Industrial dynamics, innovation, market structure, pharmaceuticals, History-Friendly model
    JEL: C63 L10 L65
    Date: 2010–11

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