New Economics Papers
on Business, Economic and Financial History
Issue of 2012‒10‒06
fifteen papers chosen by

  1. The Declines in Infant Mortality and Fertility: Evidence from British Cities in Demographic Transition By Newell, Andrew T.; Gazeley, Ian
  2. Jules Dupuit and the railroads: what is the role of the State? By Philippe Poinsot
  3. Origins and Outcomes of Electoral Institutions in African Hybrid Regimes: A Comparative Perspective By Alexander Stroh; Sebastian Elischer; Gero Erdmann
  4. 150 years of Italian political unity and economic dualism: An Introduction By Michele Fratianni
  5. Représenter la diversité des formes familiales de la production agricole. Approches théoriques et empiriques By Sourisseau, J.M.; Bosc, P.M.; Fréguin-Gresh, S.; Bélières, J.F.; Bonnal, P.; Le Coq, J.F.; Anseeuw, W.; Dury, S.
  6. EDUCATIONAL ATTAINMENT IN THE OECD, 1960-2010 By Angel de la Fuente; Rafael Doménech
  7. The Evolving Domain of Entrepreneurship Research By Carlsson, Bo; Braunerhjelm, Pontus; McKelvey, Maureen; Olofsson , Christer; Persson , Lars; Ylinenpää, Håkan
  8. Benchmarking financial systems around the world By Cihak, Martin; Demirguc-Kunt, Asli; Feyen, Erik; Levine, Ross
  9. Crisis y problemas demográficos en España desde el Antiguo Régimen hasta el presente By Vicente Pérez-Moreda; Fernando Collantes
  10. The Effects of Reconstruction Finance Corporation Assistance on Michigan’s Banks’ Survival in the 1930s By Charles W. Calomiris; Joseph R. Mason; Marc Weidenmier; Katherine Bobroff
  11. Banking, Debt, and Currency Crises: Early Warning Indicators for Developed Countries By Jan Babecký; Tomáš Havránek; Jakub Mateju; Marek Rusnák; Katerina Šmídková; Borek Vašícek
  12. Share Portfolios and Risk Management in the Early Years of Financial Capitalism: London 1690-1730 By Ann M. Carlos; Erin Fletcher; Larry Neal
  13. A narrative analysis of post-World War II changes in federal aid By Gerald Carlino; Robert Inman
  14. Who Benefits from Growth ? By Simon Beck; Thierry Kamionka
  15. Assessing the infrastructure impact of mega-events in emerging economies By Victor Matheson

  1. By: Newell, Andrew T. (University of Sussex); Gazeley, Ian (University of Sussex)
    Abstract: At the beginning of the twentieth century Britain was roughly halfway through a 60-year demographic transition with declining infant mortality and birth rates. Cities exhibited great and strongly correlated diversity in these rates. We demonstrate cross-section correlations with, for instance, women's employment, population density, literacy and improved water supply and sanitation, that have been linked to the transition. When we analyse data from the late 1850s and the early 1900s, the changes in the two rates are not correlated across cities, but we find a robust and large impact from sanitation improvement to long-period infant mortality reduction. We also find the extension of basic literacy is related to increases in female labour market participation, which is in turn related to fertility reduction. Lastly we find that more rapid urban growth accelerates fertility decline, but, in late 19th century Britain it slowed the reduction of infant mortality.
    Keywords: fertility, infant mortality, education and sanitary reform, women's participation, education, 19th century and early 20th century Britain
    JEL: N33 J13 I15
    Date: 2012–09
  2. By: Philippe Poinsot (PHARE - Pôle d'Histoire de l'Analyse et des Représentations Economiques - CNRS : FRE2541 - Université Paris I - Panthéon Sorbonne - Université Paris X - Paris Ouest Nanterre La Défense)
    Abstract: In the nineteenth century, the emergence of railroads in France resulted in new analytical issues, as they are natural monopolies. Jules Dupuit examined the issue of the operations of the railroad sector on several occasions (1853, 1861 and 1862). He would seem to have defended two contrasting positions, opening the way for debate among commentators. In this communication, I attempt to restore the consistency of Dupuit's positions on the railroads. In the first section, I distinguish between competition as an ideal and the feasibility of competition in the railroad sector; this distinction is implicit in Dupuit's work, but it helps us to grasp that, in his opinion, unlimited competition is not possible in the railroads and that it is not necessarily beneficial to the welfare of society. The State should therefore regulate the railroad sector either by State management or through concessions. In the second section, I specify the conditions under which he believed the State should manage the railroads sector instead of offering concessions to private companies.
    Keywords: railroads; Jules Dupuit; natural monopoly; regulation; competition
    Date: 2012–04–04
  3. By: Alexander Stroh (GIGA German Institute of Global and Area Studies); Sebastian Elischer (GIGA German Institute of Global and Area Studies); Gero Erdmann (GIGA German Institute of Global and Area Studies)
    Abstract: In the early 1990s most African countries carried out extensive reforms of their electoral regimes. Adopting a historical institutionalist approach, this paper critically examines the role of institutional path dependence in accounting for the setup of six African electoral regimes. For this purpose, we distinguish between different types of path dependence. The paper further analyzes the extent to which the development of electoral institutions contributed to the regime-type outcome (democratic/hybrid/autocratic). The main emphasis herein is on so-called “hybrid regimes;” in other words, regimes existing in the grey zone between democracy and autocracy. The paper finds that, while institutional path dependence has a limited but important impact on the setup of the electoral regimes, it is ultimately the process of decision-making during critical junctures that accounts for the regime type outcome. Hybrid regimes lack long-term institutional ownership.
    Keywords: hybrid regimes, democratization, historical institutionalism, electoral institutions, Africa
    Date: 2012–06
  4. By: Michele Fratianni (Indiana University, Kelly School of Business, Bloomington US, Univ. Plitecnica Marche and MoFiR)
    Abstract: This Special Issue of Rivista Italiana degli Economisti celebrates the 150th anniversary of Italy's political unity. Since 1861, Italy has evolved from a poor, backward and agrarian economy to a rich and industrial economy; has gone though bouts of economic insularity and integration; has swung from massive emigration to large immigration has experienced an inflation rate much higher than that of the reference industrial countries; has accumulated a debilitating public debt; and has blessed the demise of the lira to embrace a new currency, the euro, which now is under threat of imploding. Amidst all these changes, two features have endured: political unity and a deep economic divide between the North and the South.
    Keywords: debt, economic dualism, economic growth, inflation
    JEL: E31 N13 N14 O40
    Date: 2012–09
  5. By: Sourisseau, J.M.; Bosc, P.M.; Fréguin-Gresh, S.; Bélières, J.F.; Bonnal, P.; Le Coq, J.F.; Anseeuw, W.; Dury, S.
    Abstract: The transformation of family-based agricultural structures is compelling the academic and policy environments. The questions being advanced cross the history of agricultural representations since a century. The ways of seeing and representing the different forms of agriculture relate to these transformations. Family farming has acquired an international legitimacy but is presently questioned by agricultural evolutions in developed countries as well as in developing or emerging ones. The Sustainable Rural Livelihoods (SRL) approach allows a global comprehension of the agricultural entity as a constituent of an activity system that has become multi-sectoral and multi-situational, relating to market and non-market regulations. The relative significance and the nature of the mobilized capitals led us to schematically present six organizational forms of family agriculture in New-Caledonia, in Mali, in Viet-Nam, in South Africa, France and Brazil. A more generic characterization that foresees our representation framework proposal poses new methodological challenges. ...French Abstract : Les mutations des agricultures familiales interrogent le monde académique et les politiques. Cette interrogation traverse l’histoire des représentations de l’agriculture depuis un siècle. Les manières de voir ces agricultures ont accompagné leurs transformations. Aujourd’hui, l’agriculture familiale acquiert une légitimité internationale mais elle est questionnée par les évolutions des agricultures aux Nords comme aux Suds. L’approche Sustainable Rural Livelihoods (SRL) permet une appréhension globale du fait agricole comme une composante de systèmes d’activités multi sectoriels et multi situés dont les logiques renvoient à des régulations marchandes et non marchandes. Le poids relatif et la nature des capitaux mobilisés permettent de représenter de manière stylisée six formes d’organisation de l’agriculture familiale en Nouvelle-Calédonie, au Mali, au Viêt-Nam, en Afrique du Sud, en France et au Brésil. Une caractérisation plus générique, qu’esquisse notre proposition de méthode de représentation des agricultures est enfin proposée, qui pose de nouvelles questions méthodologiques.
    JEL: O13 O57 Q12
    Date: 2012
  6. By: Angel de la Fuente; Rafael Doménech
    Abstract: This paper describes the construction of series of educational attainment of the adult population insample of 21 OECD countries covering the period 1960-2010. These series are a revised version of the data set described in de la Fuente and Doménech (2002)
    Keywords: educational attainment, schooling.
    JEL: I20
    Date: 2012–09–25
  7. By: Carlsson, Bo (Case Western Reserve University, Weatherhead School of Management, Department of Economics); Braunerhjelm, Pontus (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); McKelvey, Maureen (RIDE and Institute of Innovation and Entrepreneurship); Olofsson , Christer; Persson , Lars; Ylinenpää, Håkan
    Abstract: Research on entrepreneurship has flourished in recent years and is evolving rapidly. This paper explores the history of entrepreneurship research, how the research domain has evolved, and its current status as an academic field. The need to concretize these issues stems partly from a general interest to define the current research domain, partly from the more specific tasks confronting the prize committee of the Global Award for Entrepreneurship Research. Entrepreneurship has developed in many sub-fields within several disciplines - primarily economics, management/business administration, sociology, psychology, economic and cultural anthropology, business history, strategy, marketing, finance, and geography - representing a variety of research traditions, perspectives, and methods. We present an analytical framework that organizes our thinking about the domain of entrepreneurship research, by specifying elements, levels of analysis and the process/context. An overview is provided of where the field stands today and how it is positioned relative to the existing disciplines and new research fields upon which it draws. Areas needed for future progress are highlighted, particularly the need for a rigorous dynamic theory of entrepreneurship that relates entrepreneurial activity to economic growth and human welfare. Moreover, applied work based on more careful design as well as on theoretical models yielding more credible and robust estimates seems also highly warranted.
    Keywords: Entrepreneurship; innovation; evolution; inter-disciplinary
    JEL: B53 L10 L26 O30
    Date: 2012–09–26
  8. By: Cihak, Martin; Demirguc-Kunt, Asli; Feyen, Erik; Levine, Ross
    Abstract: This paper introduces the Global Financial Development Database, an extensive dataset of financial system characteristics for 205 economies from 1960 to 2010. The database includes measures of (a) size of financial institutions and markets (financial depth), (b) degree to which individuals can and do use financial services (access), (c) efficiency of financial intermediaries and markets in intermediating resources and facilitating financial transactions (efficiency), and (d) stability of financial institutions and markets (stability). The authors document cross-country differences and time series trends.
    Keywords: Debt Markets,Emerging Markets,Access to Finance,Banks&Banking Reform,Economic Theory&Research
    Date: 2012–08–01
  9. By: Vicente Pérez-Moreda (Universidad Complutense de Madrid, Spain); Fernando Collantes (Universidad de Zaragoza, Spain)
    Abstract: El trabajo analiza las crisis demográficas españolas desde una perspectiva de largo plazo que cubre el Antiguo Régimen y la edad contemporánea. Para el Antiguo Régimen, se consideran las crisis de mortalidad: alzas bruscas de las defunciones que conducían a fuertes descensos de la población en las localidades y comarcas afectadas. Para el periodo contemporáneo, durante el cual las crisis de mortalidad fueron remitiendo (si bien de manera muy gradual, ya que persistieron durante el siglo XIX y comienzos del XX), se analizan los procesos de despoblación rural y provincial impulsados por movimientos migratorios; también se presta atención a las implicaciones económicas que la reciente tendencia hacia el envejecimiento poblacional podría tener a lo largo de la primera mitad del siglo XXI
    Keywords: mortality crises, depopulation, ageing, Spain
    JEL: N33 N34 I15 J11 R00
    Date: 2012–09
  10. By: Charles W. Calomiris; Joseph R. Mason; Marc Weidenmier; Katherine Bobroff
    Abstract: This paper examines the effects of the Reconstruction Finance Corporation’s (RFC) loan and preferred stock programs on bank failure rates in Michigan during the period 1932-1934, which includes the important Michigan banking crisis of early 1933 and its aftermath. Using a new database on Michigan banks, we employ probit and survival duration analysis to examine the effectiveness of the RFC’s loan program (the policy tool employed before March 1933) and the RFC’s preferred stock purchases (the policy tool employed after March 1933) on bank failure rates. Our estimates treat the receipt of RFC assistance as an endogenous variable. We are able to identify apparently valid and powerful instruments (predictors of RFC assistance that are not directly related to failure risk) for analyzing the effects of RFC assistance on bank survival. We find that the loan program had no statistically significant effect on the failure rates of banks during the crisis; point estimates are sometimes positive, sometimes negative, and never estimated precisely. This finding is consistent with the view that the effectiveness of debt assistance was undermined by some combination of increasing the indebtedness of financial institutions and subordinating bank depositors. We find that RFC’s purchases of preferred stock – which did not increase indebtedness or subordinate depositors – increased the chances that a bank would survive the financial crisis. We also perform a parallel analysis of the effects of RFC preferred stock assistance on the loan supply of surviving banks. We find that RFC assistance not only contributed to loan supply by reducing failure risk; conditional on bank survival, RFC assistance is associated with significantly higher lending by recipient banks from 1931 to 1935.
    JEL: G01 G18 G21 G28 N12 N22
    Date: 2012–09
  11. By: Jan Babecký (Czech National Bank); Tomáš Havránek (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jakub Mateju (CERGE-EI); Marek Rusnák (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Katerina Šmídková (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Borek Vašícek (Czech National Bank)
    Abstract: We construct and explore a new quarterly dataset covering crisis episodes in 40 developed countries over 1970–2010. First, we examine stylized facts of banking, debt, and currency crises. Using panel vector autoregression, we confirm that currency and debt crises are typically preceded by banking crises, but not vice versa. Banking crises are also the most costly in terms of the overall output loss, and output takes about six years to recover. Second, we try to identify early warning indicators of crises specific to developed economies, accounting for model uncertainty by means of Bayesian model averaging. Our results suggest that onsets of banking and currency crises tend to be preceded by booms in economic activity. In particular, we find that growth of domestic private credit, increasing FDI inflows, rising money market rates as well as increasing world GDP and inflation were common leading indicators of banking crises. Currency crisis onsets were typically preceded by rising money market rates, but also by worsening government balances and falling central bank reserves. Early warning indicators of debt crises are difficult to uncover due to the low occurrence of such episodes in our dataset. Finally, employing a signaling approach we show that using a composite early warning index significantly increases the usefulness of the model when compared to using the best single indicator (domestic private credit).
    Keywords: Early warning indicators, Bayesian model averaging, macro-prudential policies
    JEL: C33 E44 E58 F47 G01
    Date: 2012–07
  12. By: Ann M. Carlos; Erin Fletcher; Larry Neal
    Abstract: : The dramatic expansion of public and private financial markets in the aftermath of the Glorious Revolution has received extensive attention. Despite interest in the operation of the capital market, much less is known about how ordinary individual investors managed risk within this framework. Using a newly constructed data set of share ownership for each company listed in the financial press of the day, we reconstruct individual portfolio holdings for all investors in these companies. We examine individual portfolio holdings first for the decade after the Glorious Revolution and then for the years around the South Sea Bubble of 1720. We also examine holdings over time. Despite a fivefold increase in the number of unique individuals in the market between the 1690s and the 1720s, we find that in each period roughly eighty per cent of those active in the equity market owned shares in only one company, even though most shareholders had the capacity or wealth to diversity their share portfolios. We also find some continuity in the market with forty per cent of those who owned stock in 1690 holding stock two decades later. This level of stock market activity suggests that individuals were diversifying against idiosyncratic liquidity risk. Overall, however, there is limited evidence that individuals were using their financial portfolios to increase income or reduce risk or to protect themselves against diversifiable shocks. Clearly some part of this behaviour can be explained by low levels of financial literacy, for many, however, company specific voting rules with their attendant effects on firm governance drove market activity.
    Date: 2012–09
  13. By: Gerald Carlino; Robert Inman
    Abstract: Because of lags in legislating and implementing fiscal policy, private agents can often anticipate future changes in tax policy and government spending before these changes actually occur, a phenomenon referred to as fiscal foresight. Econometric analysis that fails to model fiscal foresight may obtain tax and spending multipliers that are biased. One way researchers have attempted to deal with the problem of fiscal foresight is by examining the narrative history of government revenue and spending news. The Great Recession and efforts by the federal government through the American Recovery and Reinvestment Act of 2009 (ARRA) to stimulate the economy returned fiscal policy, and in particular the role of state and local governments in such policies, to the center of macro-economic policymaking. In a companion paper, we use federal grants-in-aid to state and local governments to provide an evaluation of the effectiveness of the ARRA. The purpose of this paper is to develop narrative measures of the federal grants-in-aid programs beginning with the Federal Highway Act of 1956 through the ARRA of 2009. The narrative measures we develop will be used as instruments for federal grants-in-aid in our subsequent analysis of the ARRA.
    Keywords: Fiscal policy ; American Recovery and Reinvestment Act of 2009
    Date: 2012
  14. By: Simon Beck (Crest); Thierry Kamionka (Crest)
    Abstract: In this paper we highlight the link existing between economic growth and inequality. Using the FH-DADS panel data set, resulting from the matching of Pôle Emploi (French National Employment Agency) historical database and the "Déclarations Annuelles de Données Sociales” data set (DADS), we show that inequality increases with mobility, and that mobility evolves with GDP variations. Data show indeed that inequality tends to increase during economic growth periods and to decrease during slow down, through unequal mobility between individuals. In order to explain this phenomenon, we use two structural models. One based on Jolivet, Postel-Vinay and Robin (2006) allows us to link inequality and mobility through equilibrium changes on the job market. Another one, due to Robin (2011), confirms on US data the link existing between inequality and economic growth
    Keywords: Inequality, Growth, Labor market, Mobility, Panel data, Equilibrium search model
    JEL: C23 J60 D31
    Date: 2012–09
  15. By: Victor Matheson (Department of Economics, College of the Holy Cross)
    Abstract: Developing countries that host mega-events such as the Olympic Games and World Cup invest enormous sums in stadiums and collateral infrastructure projects. The rapid investment in long-lasting physical stocks raises questions of equity and efficiency for national taxpayers and event attendees. This paper reviews several cases of historical and recent mega-events to assess the infrastructure costs, returns on infrastructure investments, and impacts of the events on urban development patterns. It will highlight cases where mega-event investments contributed to long-term economic growth.
    Keywords: sports, stadiums, development, impact analysis, Olympics, World Cup, tourism
    JEL: L83 O18 R53
    Date: 2012–09

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