New Economics Papers
on Business, Economic and Financial History
Issue of 2013‒04‒20
twelve papers chosen by

  1. Dreams of order and freedom : debating trade management early 17th century England By Carlos Eduardo Suprinyak
  2. Economic Thinking about Transnational Governance: Blind Spots and Historical Perspectives By Hans-Michael Trautwein
  3. Isaac I. Rubin e sua história do pensamento econômico By João Antonio de Paula; Hugo E. A. da Gama Cerqueira
  4. A dinâmica do processo de urbanização no Brasil, 1940-2010 By Fausto Alves de Brito; Breno Aloísio T. Duarte de Pinho
  5. Large Block Shareholders, Institutional Investors, Boards of Directors and Bank Value in the Nineteenth Century By Howard Bodenhorn
  6. Transportes, modernização e formação regional: subsídios a história da era ferroviária em Minas Gerais By Felipe de Alvarenga Batista; Lidiany Silva Barbosa; Marcelo Magalhães Godoy
  8. Fiscal sustainability in South Africa: Will history repeat itself? By Estian Calitz; Stan du Plessis; Krige Siebrits
  9. The development of private farms in Vietnam By Kojin, Emi
  10. Ingham and Keynes on the Nature of Money By Mark Hayes
  11. A New International Database on Education Quality: 1965-2010 By Nadir Altinok; Claude Diebolt; Jean-Luc Demeulemeester
  12. Capital social y desarrollo industrial. El caso de Prato, Italia By Pablo Galaso Reca

  1. By: Carlos Eduardo Suprinyak (Cedeplar-UFMG)
    Abstract: The catharsis produced by the early 1620’s trade crisis had a significant impact on the way economic themes were regarded by public opinion in England. As a result, those who analyze the ideas put forward in the documents written during that period – be they printed pamphlets or official memoranda – are left with the impression that an adequate supply of money was the undisputed primary concern as regards economic administration. However, as already stressed by Barry Supple, monetary administration only occupied a prominent position in the political agenda of early 17th century England during times of crisis – that is, when the kingdom was faced with a perceived threat of demonetization. This paper tries to show that, during the first two decades of the 17th century, concern with an inflow of bullion and a positive balance of trade was only of secondary importance, being normally overshadowed by a more fundamental aim: promoting a well-ordered structure for the economic relations of the kingdom, according to specific views of what constituted proper trade management. This approach encompassed both foreign and domestic activities, and found its most evident manifestation in the debates about free trade and monopolies which permeated the whole of James I’s reign.
    Keywords: free trade; monopoly; mercantilism; 17th century; Stuart England.
    JEL: B14 B24 B31
    Date: 2012–04
  2. By: Hans-Michael Trautwein (University of Oldenburg - Department of Economics & ZenTra)
    Abstract: The notion of 'transnational governance' refers to systems in which private actors and other non- state institutions participate in setting and enforcing norms for cross-border transactions in trade, finance and other business. While the term is modern, the co-evolution of world markets and hybrid regulation has been discussed since the times of pre-classical and classical political economy. Yet, while transnational governance is a hot issue in other disciplines, it is almost a non-theme in current economics. This paper explores the development of economic thinking about transnational governance in three steps. It starts with a description of transnationalization and a typology of transnational governance. Thereafter it relates the historical causes and analytical choices that make it difficult to deal with transnational governance in terms of modern economics. The blind spots in current frameworks of economic thinking raise the question whether more substantial reflections about transnational governance can be found in the history of economic thought, in the periods when economics as an academic discipline developed along with the emergence of nation states and the global system of markets. In the third step relevant ideas of Adam Smith, Friedrich List, Max Weber, John Hicks and many others are discussed and evaluated in the contexts of city states, trading companies, cross-border finance and self-regulation.
    Keywords: transnational governance, private ordering, co-regulation, cross-border finance, city states, trading companies
    JEL: B12 B15 B25 D02 F59 K2
    Date: 2013–03
  3. By: João Antonio de Paula (Cedeplar-UFMG); Hugo E. A. da Gama Cerqueira (Cedeplar-UFMG)
    Abstract: This paper presents Isaak Rubin’s History of Economic Thought. After a brief description of his life and work, the paper discusses Karl Marx’s attempts to write a critical history of the political economy and, in connection with this, the paper analyses the meaning of Rubin’s History of Economic Thought.
    Keywords: Isaak Illich Rubin (1886-1937), Karl Marx (1818-1883), history of economic thought, critique of political economy.
    JEL: B14 B24 B31
    Date: 2013–04
  4. By: Fausto Alves de Brito (Cedeplar-UFMG); Breno Aloísio T. Duarte de Pinho (Cedeplar-UFMG)
    Abstract: The urbanization process in Brazil is crucial in the structural conformation of modern Brazilian society, especially from the second half of the twentieth century. Not only is the territory that accelerates the process of urbanization, but Brazilian society itself that becomes increasingly urban. The city becomes the privileged locus of economic activities more relevant and the vast majority of the population. The novelty of the urbanization process in Brazil was his tremendous speed, much higher than the developed countries, which did coincide in time, the processes of urbanization, urban population concentration in large cities and metropolises.
    Keywords: urbanization process, system of cities
    JEL: J6
    Date: 2012–12
  5. By: Howard Bodenhorn
    Abstract: Share prices of modern corporations are influenced by the size and structure of boards of directors, large individual and institutional investors, and shareholder voting rights, among other governance features. It is not clear whether the same features mattered historically, given recent research suggesting that the principal concern in the nineteenth century was neither managerial self-dealing nor majority shareholder expropriation that might reduce the returns to common shareholders. Rather, at many nineteenth-century corporations, common shareholders were also customers and shareholding offered preferential access to the firms’ goods and services. Using modern empirical tools in a study of banks, this study finds evidence supporting the shareholder-as-customer model. Bank values responded positively to the presence of large-block individual shareholders (those more concerned with access to loans) and negatively to large-block institutional investors (those more concerned with dividend returns than access). Moreover, firm value declined as directors consumed larger fractions of a bank’s loans, which reduced the bank’s ability to extend credit to other shareholders.
    JEL: G3 N21
    Date: 2013–04
  6. By: Felipe de Alvarenga Batista (UFRJ); Lidiany Silva Barbosa (Cedeplar-UFMG); Marcelo Magalhães Godoy (Cedeplar-UFMG)
    Abstract: This study examines the process of railway modernization in Minas Gerais. It uses theoretical classification that combines external variables, especially the expansion of the capital into the periphery, with internal variables, above all the hegemony of the raw material exporting model, marked by strong regional diversity. It was noted that the inappropriateness of the dominant standard of railway modernization in Brazil in relation to the structure of the economy of Minas did not prevent expansion of the tracks from reaching their greatest length in the territory of Minas Gerais. Political and financial factors presided over the Minas railway fever, which, in spite of being contemporary, underlined the irrational, onerous and dysfunctional nature of the system of concession, public subsidies and maintenance by the State of the regional network. On the ideological level, a supposedly legitimating association was mobilized between railways and modernity. On the substantive level, elements of the history of railway companies with activities in Minas Gerais were covered, were covered, and a time period is proposed for the Minas railway age, accompanied by systematization of the expansion process of the railway network based on.
    Keywords: transportation, modernization, railway age, Minas Gerais, 1870-1940
    JEL: N46 N76 N96
    Date: 2012–04
  7. By: Edward L. Glaeser; Sari Pekkala Kerr; William R. Kerr
    Abstract: Measures of entrepreneurship, such as average establishment size and the prevalence of start-ups, correlate strongly with employment growth across and within metropolitan areas, but the endogeneity of these measures bedevils interpretation. Chinitz (1961) hypothesized that coal mines near Pittsburgh led that city to specialization in industries, like steel, with significant scale economies and that those big firms led to a dearth of entrepreneurial human capital across several generations. We test this idea by looking at the spatial location of past mines across the United States: proximity to historical mining deposits is associated with bigger firms and fewer start-ups in the middle of the 20th century. We use mines as an instrument for our entrepreneurship measures and find a persistent link between entrepreneurship and city employment growth; this connection works primarily through lower employment growth of start- ups in cities that are closer to mines. These effects hold in cold and warm regions alike and in industries that are not directly related to mining, such as trade, finance and services. We use quantile instrumental variable regression techniques and identify mostly homogeneous effects throughout the conditional city growth distribution.
    Keywords: Entrepreneurship, Industrial Organization, Chinitz, Agglomeration, Clusters, Cities, Mines
    JEL: L0 L1 L2 L6 N5 N9 O1 O4 R0 R1
    Date: 2013–04
  8. 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: Several empirical studies have found that fiscal policy has been sustainable in South Africa since 1960. This paper complements these studies by providing perspective on the manner in which fiscal sustainability was maintained. It discusses two episodes of significant increases and one period of substantial reduction in the public debt burden to show that periods of rising deficits and government debt in South Africa were followed by returns to sustainable levels, thereby preventing major domestic economic crises and external interventions. The paper also provides a projection of the fiscal outlook for South Africa based on a structural VAR model. The results suggest that the discretionary fiscal decisions of 2007 to 2010 might pose a serious threat to the sustainability of fiscal policy unless the authorities respond as they did in the past by checking large budget deficits and concomitant rapid increases in the public debt burden promptly.
    Keywords: fiscal policy, fiscal sustainability, South Africa
    JEL: H62 H63
    Date: 2013
  9. By: Kojin, Emi
    Abstract: The objective of this paper is to explore the entities that have developed private farms (trang trai) in Vietnam. Various types of private farms have emerged in the last ten years. It is noteworthy that the owners of private farms are not necessarily agricultural households but also include government officials and the urban rich. Based on data collected from the author’s field surveys in Vietnam from 2006 to 2011, the paper attempts to categorize patterns in the development of private farms and analyze their differences. The paper argues that private farms developed by agricultural households are still limited because of the difficulty of consolidating land.
    Keywords: Vietnam, Land tenure, Agriculture, Private farm, Trang trai, Business history, Agricultural household, Land market
    JEL: O13 Q12 Q15
    Date: 2013–03
  10. By: Mark Hayes (University of Cambridge)
    Abstract: This paper compares and contrasts the thinking of Keynes and Geoffrey Ingham, focussing mainly on The General Theory and Ingham’s The Nature of Money (2004). Two points in particular are addressed: first, the relevance of Ingham’s insistence (following Keynes, among others) on the primacy of money of account to an understanding of Keynes’s own insistence that income is intrinsically monetary and upon the importance of the wage unit as an analytical tool; and second, the subtle contrast between Keynes and Ingham in their understandings of the source of interest as a genuinely monetary and not a ‘real’ phenomenon. Where Keynes identifies uncertainty as the source of interest within a methodologically individualistic framework of analysis, Ingham offers a sociological case in terms of the struggle between the debtor and creditor interests that inevitably emerge as a result of the creation of bank money under capitalism. Taking both points together, Ingham’s work not only underpins the crucial distinction between money and ‘real’ wages for the theory of employment but also develops Keynes’s recognition of the potential opposition between the interests of finance and industry.
    Keywords: nature of money – nature of income – theory of interest
    JEL: B22 B31 E01 E42 E43
    Date: 2012–09
  11. By: Nadir Altinok (BETA (University of Lorraine), IREDU (University of Bourgogne, France); Claude Diebolt (BETA (Bureau d'Economie Théorique et Appliquée), France); Jean-Luc Demeulemeester (DULBEA (University of Bruxelles), Bruxelles)
    Date: 2013
  12. By: Pablo Galaso Reca (Universidad Autónoma de Madrid)
    Abstract: Este artículo estudia los rasgos distintivos del capital social en la provincia de Prato (Italia), así como su papel en el nacimiento y posterior desarrollo de su distrito industrial. Para ello, se basa en múltiples investigaciones previas sobre dicha región, analizando sus resultados desde la óptica de las teorías del capital social. Las conclusiones muestran que el capital social desempeñó un rol fundamental en distintos momentos de la historia pratense, permitiendo que desarrollara con éxito el modelo característico de los distritos industriales.
    Keywords: capital social, distritos industriales, desarrollo local, industria textil.
    JEL: L67 L25
    Date: 2013–12–04

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