nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2014‒06‒07
nineteen papers chosen by
Bernardo Batiz-Lazo
Bangor University

  1. Just Add Milk: A Productivity Analysis of the Revolutionary Changes in Nineteenth Century Danish Dairying By Markus Lampe; Paul Sharp
  2. Urbanization in Southeast Asia during the World War II Japanese Occupation and Its Aftermath By Gregg Huff; Gillian Huff
  3. Migrant Networks and Trade: The Vietnamese Boat People as a Natural Experiment By Pierre-Louis Vezina; Christopher Parsons
  4. Food for Thought: Comparing Estimates of Food Availability in England and Wales, 1700-1914 By Bernard Harris; Roderick Floud; Sok Chul Hong
  5. The Australian growth miracle: An evolutionary macroeconomic explanation By John Foster
  6. Life in the First Person and the Art of Political Storytelling:The Rhetoric of Andreas Papandreou By Nick Papandreou
  7. The Separation of Information and Lending and the Rise of Rating Agencies in the United States By Marc Flandreau; Gabriel Geisler Mesevage
  8. Children's Growth in an Adaptive Framework: Explaining the Growth Patterns of American Slaves and Other Historical Populations By Eric B. Schneider
  9. The Crisis of 1866 By Marc Flandreau; Stefano Ugolini
  10. The Agricultural Origins of Time Preference By Oded Galor; Ömer Özak
  11. Does in utero Exposure to Illness Matter? The 1918 Influenza Epidemic in Taiwan as a Natural Experiment By Ming-Jen Lin; Elaine M. Liu
  12. The dust was long in settling: Human capital and the lasting impact of the american dust bowl By Vellore Arthi
  13. Culture: Persistence and Evolution By Francesco Giavazzi; Ivan Petkov; Fabio Schiantarelli
  14. Crecimiento económico en el Perú bajo los Borbones, 1700-1820 By Carlos Contreras
  15. An Analysis of the Investment Decisions on the European Electricity Markets, over the 1945-2013 Period By Pascal Da Costa; Bianka Shoai Tehrani
  16. La tarification de l'électricité: un sujet négligé lors des débats sur la nationalisation en 1962 By Jean-Thomas Bernard
  17. Dissecting the Act of God: An Exploration of the Effect of Religion on Economic Activity By Carpantier, Jean-Francois; Litina, Anastasia
  18. Community-based digital fabrication workshops: A review of the research literature By Sabine Hielscher; Adrian Smith

  1. By: Markus Lampe (Universidad Carlos III); Paul Sharp (University of Southern Denmark)
    Abstract: The late nineteenth century Danish agricultural revolution saw the modernization and growth of the dairy industry. Denmark rapidly caught up with the leading economies, and Danish dairying led the world in terms of productivity. Uniquely in a world perspective, high quality micro-level data exist documenting this episode. These allow the use of the tool of modern agricultural economists, stochastic frontier analysis, to estimate production functions for milk and thus find the determinants of these productivity and efficiency advances. We identify the contribution of modernization through specific new technologies and practices.
    Keywords: Dairies, Denmark, development, Stochastic Frontier Analysis
    JEL: L2 N5 O3 Q1
    Date: 2014–05
  2. By: Gregg Huff (Pembroke College); Gillian Huff (Department of History)
    Abstract: This working paper analyzes demographic change in Southeast Asia’s main cities during and soon after the World War II Japanese occupation. We argue that two main patterns of population movements are evident. In food-deficit areas, a search for food security typically led to large net inflows to main urban centres. By contrast, an urban exodus dominated in food surplus regions because the chief risk was to personal safety, especially from Japanese and Allied bombing. Black markets were ubiquitous, and essential to sustaining livelihoods in cities with food-deficit hinterlands. In Rangoon and Manila, wartime population fluctuations were enormous. Famines in Java and northern Indochina severely impacted Jakarta and Hanoi through inflows of people from rural areas. In most countries, the war’s aftermath of refugees, revolution and political disruption generated major rural-urban population relocations. Turmoil in the 1940s had the permanent consequences of augmenting the primacy of Southeast Asia’s main cities and promoting squatter settlement.
    Keywords: urbanization, Southeast Asia, famine, World War II, entitlements, Japan
    JEL: N15 N90 N95 R11
    Date: 2014–04–20
  3. By: Pierre-Louis Vezina; Christopher Parsons
    Abstract: We provide cogent evidence for the causal pro-trade effect of migrants and in doing so establish an important link between migrant networks and long-run economic development.� To this end, we exploit a unique event in human history, the exodus of the Vietnamese Boat People to the US.� This episode represents an ideal natural experiment as the large immigration shock, the first wave of which comprised refugees exogenously allocated across the US, occurred over a twenty-year period during which time the US imposed a complete trade embargo on Vietnam.� Following the lifting of trade restrictions in 1994, the share of US exports going to Vietnam was higher and more diversified in those US States with larger Vietnamese populations, themselves the result of larger refugee inflows 20 years earlier.
    Keywords: Migrant Networks, US Exports, Natural Experiment
    JEL: F14 F22
    Date: 2014–05–07
  4. By: Bernard Harris; Roderick Floud; Sok Chul Hong
    Abstract: In The Changing Body (Cambridge University Press and NBER, 2011), the authors presented a series of estimates showing the number of calories available for human consumption in England and Wales at various points in time between 1700 and 1909/13. The current paper corrects an error in those figures but also compares the estimates of The Changing Body with those published by a range of other authors. The differences reflect disagreements over a number of issues, including the amount of land under cultivation, the extraction and wastage rates for cereals and pulses and the number of animals supplying meat and dairy products. The paper considers recent attempts to achieve a compromise between these estimates and challenges claims that there was a dramatic reduction in either food availability or the average height of birth cohorts in the late-eighteenth century.
    JEL: N01 N33 N53 O1 O13 O52
    Date: 2014–05
  5. By: John Foster (School of Economics, The University of Queensland)
    Abstract: The purpose of this article is to understand the drivers of Australian economic growth since its Federation in 1901. Australia is an interesting case study given that it seems not to have been affected by the ‘natural resource curse’ like many other natural resource dependent countries. Indeed, at time of writing, it has been 23 years since it experienced a recession and its GDP per capita is now amongst the very highest in the World. At the end of the 19th Century it also had one of the highest per capita incomes in the World and, although there were economic difficulties between the World Wars, it did not fall into relative economic decline like, for example, Argentina, also a European immigrant country producing and exporting natural resources.
    Date: 2014–05–30
  6. By: Nick Papandreou
    Abstract: This essay analyzes Andreas Papandreou’s skill as a political “storyteller.” For a great majority of the Greek population, it is his narrative, his tale of modern Greece, the essay argues, that has become the accepted one. It was his narrative that helped bring and keep him in power for eleven years. One of the building blocks was an innate talent to draw conclusions and persuade the audience using events from his own personal experience – life in the first person. Another element was his academic background and a natural linguistic fluency. The analysis emphasizes his rhetorical devices and draws from the tropes of literature (metaphor, simile, suspense) to complete the standard portrait usually provided by political scientists and historians.
    Date: 2014–05
  7. By: Marc Flandreau; Gabriel Geisler Mesevage (IHEID, The Graduate Institute of International and Development Studies, Geneva)
    Abstract: This paper provides a new interpretation of the early rise of rating agencies in the United States (initially known as ‘Mercantile Agencies’). We explain this American exceptionality through an inductive approach that revisits the conventional parallel with the UK. In contrast with earlier narratives that have emphasized the role of Common Law and the greater understanding of American judges that would have supported the rise of an ethos of ‘transparency’, we argue that Mercantile Agencies prospered as a remedy to deficient bankruptcy law and weak protection of creditor rights in the US. The result was to raise the value of the nation-wide registry of defaulters which the Mercantile Agencies managed. This ensured the Agencies’ profitability and endowed them with resources to buy their survival in a legal environment that remained stubbornly hostile.
    Keywords: Rating, Mercantile Agencies, Information, Credit Insurance, Comparative Economic History, Libel, Business Law
    JEL: P5 G2 N2 K2
    Date: 2014–05–27
  8. By: Eric B. Schneider
    Abstract: This paper presents a new adaptive framework for understanding children's growth in the past.� Drawing upon the recent work of Gluckman and Hanson (2006) and their co-authors on adaptive responses in relation to growth, I present three prenatal and three postnatal adaptive mechanisms that affect the growth patterns of children.� The most novel adaptive response to the historical literature is the prenatal predictive adaptive response where the foetus develops assuming that the postnatal environment will closely match prenatal conditions.� Thus, the metalbolism and growth trajectory of a child is programmed during the prenatal period: children experiencing good conditions�in utero would have a higher metabolism and growth trajectory than their counterparts facing poor conditions.� Having discussed the framework and other responses in detail, I then use it to reinterpret the growth pattern of American slaves (Steckel, 1979, 1986).� I argue that the mismatch between relatively good conditions in utero and absolutely appalling conditions in infancy and early childhood led slave children to become incredibly stunted by age three or four.� However, after this age, slave children experienced rapid catch-up growth, first because their immune systems had become more developed and had adapted to the poor disease environment and later because their diet improved tremendously and hookworm exposure was reduced when they entered the labour force around age ten.� Thus, American slave children were able to experience rapid catch-up growth because they were prenatally programmed for a higher metabolism and growth trajectory.� The paper concludes by setting out some stylized facts about children's growth in the past and pointing toward areas of future research.
    Date: 2014–05–29
  9. By: Marc Flandreau; Stefano Ugolini (IHEID, The Graduate Institute of International and Development Studies, Geneva)
    Abstract: The collapse of Overend Gurney and the ensuing Crisis of 1866 was a turning point in British financial history. The achievement of relative stability was due to the Bank of England’s willingness to offer generous assistance to the market in a crisis, combined with an elaborate system for maintaining the quality of bills in the market. We suggest that the Bank bolstered the resilience of the money market by monitoring leverage-building by money market participants and threatening exclusion from the discount window. When the Bank refused to bailout Overend Gurney in 1866 there was panic in the market. The Bank responded by lending freely and raising the Bank rate to very high levels. The new policy was crucial in allowing for the establishment of sterling as an international currency.
    Keywords: Bagehot, Bank of England, Lending of last resort, Supervision, Moral hazard, Discount, Overend Gurney Panic, Baring.
    JEL: E58 G01 N13
    Date: 2014–05–26
  10. By: Oded Galor (Brown University); Ömer Özak (Southern Methodist University)
    Abstract: This research explores the origins of the distribution of time preference across regions. It advances the hypothesis, and establishes empirically, that geographical variations in the incentives to delay consumption in favor of lucrative investment opportunities have had a persistent effect on the distribution of long-term orientation across societies. In particular, exploiting a natural experiment associated with the Columbian Exchange, the research establishes that agro-climatic characteristics in the pre-industrial era that were conducive to higher return to agricultural investment, triggered selection and learning processes that had a persistent positive effect on the prevalence of long-term orientation in the contemporary era.
    Keywords: Time preference, Delayed Gratification, Culture, Agriculture, Economic Development, Evolution
    JEL: O1 Z1
    Date: 2014–05
  11. By: Ming-Jen Lin; Elaine M. Liu
    Abstract: This paper tests whether in utero conditions affect long-run developmental outcomes using the 1918 influenza pandemic in Taiwan as a natural experiment. Combining several historical and current datasets, we find that cohorts in utero during the pandemic are shorter as children/adolescents and less educated compared to other birth cohorts. We also find that they are more likely to have serious health problems including kidney disease, circulatory and respiratory problems, and diabetes in old age. Despite possible positive selection on health outcomes due to high infant mortality rates during this period (18 percent), our paper finds a strong negative impact of in utero exposure to influenza.
    JEL: I12 I19 N35
    Date: 2014–05
  12. By: Vellore Arthi (Department of History)
    Abstract: I use variation in childhood exposure to the Dust Bowl, an environmental shock to health and income, as a natural experiment to explain variation in adult human capital. I find that the Dust Bowl produced significant adverse impacts in later life, especially when exposure was in utero, increasing rates of poverty and disability, and decreasing rates of fertility and college completion. Dependence on agriculture exacerbates these effects, suggesting that the Dust Bowl was most damaging via the destruction of farming livelihoods. This collapse of farm incomes, however, had the positive effect of reducing demand for child farm labor and thus decreasing the opportunity costs of secondary schooling, as evidenced by increases in high school completion amongst the exposed.
    Keywords: Dust Bowl, environmental shock, human capital formation, early life health
    Date: 2014–04–22
  13. By: Francesco Giavazzi; Ivan Petkov; Fabio Schiantarelli
    Abstract: This paper presents evidence on the speed of evolution (or lack thereof) of a wide range of values and beliefs of different generations of European immigrants to the US. The main result is that persistence differs greatly across cultural attitudes. Some, for instance deep personal religious values, some family and moral values, and political orientation converge very slowly to the prevailing US norm. Other, such as attitudes toward cooperation, redistribution, effort, children's independence, premarital sex, and even the frequency of religious practice or the intensity of association with one's religion, converge rather quickly. The results obtained studying higher generation immigrants differ greatly from those found when the analysis is limited to the second generation, as typically done in the literature, and they imply a lesser degree of persistence than previously thought. Finally, we show that persistence is "culture specific" in the sense that the country from which one's ancestors came matters for the pattern of generational convergence.
    JEL: A13 F22 J00 J61 Z1
    Date: 2014–05
  14. By: Carlos Contreras (Departamento de Economía de la PUC del Perú)
    Abstract: El siglo dieciocho fue uno de robusto crecimiento económico en el virreinato del Perú. Pero tanto la cronología, cuanto las raíces de este crecimiento son imprecisas. El inicio de la expansión suele ubicarse hacia el final de la gran epidemia de 1718-1723, que afectó a la población indígena de la sierra sur, ocasionando severos problemas inmediatos al flujo comercial, así como al suministro de trabajadores para las haciendas y minas en los años siguientes. Pero otros han apuntado al efecto que tuvieron ciertas medidas relacionadas a la tributación minera y a la introducción de nuevas tecnologías en ese sector, hacia 1736- 1745. El final del ciclo de crecimiento se ubicaría hacia 1800 o, en todo caso, durante la primera década del siglo diecinueve. Se trataría, así, de un ciclo de crecimiento que habría durado unos tres cuartos de siglo, lo que lo convertiría en uno de los más prolongados de la historia económica peruana. El papel que en este proceso tuvieron las reformas borbónicas es otro tema de debate. En este documento me propongo ordenar la información pertinente a este proceso de crecimiento económico, así como reflexionar acerca de sus determinantes. JEL Classification-JEL: N16, N46, N56
    Keywords: Crecimiento económico, siglo XVIII, Perú borbónico, historia económica colonial, América Latina.
    Date: 2014
  15. By: Pascal Da Costa (LGI - Laboratoire Génie Industriel - EA 2606 - Ecole Centrale Paris); Bianka Shoai Tehrani (LGI - Laboratoire Génie Industriel - EA 2606 - Ecole Centrale Paris, ITESE - Institut de Technico-Economie des Systèmes Energétiques - CEA : DEN/ITESE)
    Abstract: The aim of the article is to understand how the drivers for investment decisions in the capacities of electricity production have evolved over time, from 1945 to the present day, in the specific context of Europe facing wars and conflicts, scientific and technological progress, strong political and academic developments. We study the electric investment decisions by comparing the history of the European electricity markets with the successively dominant economic theories in this field. Therefore, we highlight differences between rational behaviors, such as described by the theories, and actual behaviors of investors and governments. Thus the liberalization of electricity markets in the European Union, more than twenty-five years ago, parts of a rationalization prescribed by new economic theories. It is clear that liberalization is being discussed. First, it remains very heterogeneous, which complicates the goal of creating a large single market for electricity in the Union. Second, we see a recent re-centralization of energy policy in the European Union (EU), which takes the form of a new regulation mainly relating to climate and renewables. However, this re-regulation is different from centralized control experienced by all European electricity markets until the mid-1980s.
    Keywords: European Electricity Market, Electricity Investments, European Energy Market Liberalisation, Climatic issues, Renewables.
    Date: 2013–12–13
  16. By: Jean-Thomas Bernard
    Abstract: Après les débats enflammés des années trente, la tarification de l’électricité a occupé peu de place dans ceux portant sur la nationalisation de l’électricité en 1962. La raison principale de cette absence est que le cadre réglementaire élaboré lors de la création de la Commission hydroélectrique de Québec en 1944 fut adopté sans modification significative lors de cette deuxième nationalisation. Le principe de la tarification de l’électricité selon le coût moyen ne fut pas remis en question. Outre le rapatriement de l’impôt sur le revenu des corporations payé au gouvernement fédéral, deux objectifs explicitement poursuivis lors de la nationalisation en 1962 ont laissé une influence durable sur la tarification de l’électricité, à savoir, l’uniformisation des tarifs pour l’ensemble du territoire et l’usage des tarifs pour fins de promotion industrielle. Après 1963, le gouvernement a imposé des nouvelles charges fiscales à Hydro-Québec sans remettre en cause la tarification selon le coût moyen.
    Keywords: Nationalisation, tarification, électricité, Hydro-Québec
    JEL: L32 L94
    Date: 2014
  17. By: Carpantier, Jean-Francois; Litina, Anastasia
    Abstract: This research establishes that religiosity has a persistent effect on economic outcomes. First we use a sample of migrants in the US to establish that religiosity at the country of origin has a long lasting effect on the religiosity of migrants. Second, exploiting variations in the inherited component of religiosity of migrants, our analysis uncovers the causal effect of religiosity on economic activity using a panel of countries for the period 1935-2000. The empirical findings suggest that i) church attendance has a positive impact on economic outcomes; ii) religious beliefs in the existence of god, hell, heaven and miracles have no systematic effect on economic outcomes, and iii) stronger faith is associated with prosperity. Moreover we extend our analysis to uncover the channels via which religiosity operates. Notably, the positive effect of religious participation and of stronger faith on economic outcomes operates via the creation of social capital and the development of traits, such as hard work and thrift, that are conducive to growth.
    Keywords: Religiosity, Growth, Beliefs, Migration, Culture
    JEL: A1 A13 Z1 Z12
    Date: 2014–05–30
  18. By: Sabine Hielscher (SPRU, University of Sussex, UK); Adrian Smith (SPRU, University of Sussex, UK)
    Keywords: Grassroots digital fabrication, community-based workshops, sustainability, creativity, inclusivity
    Date: 2014–05
  19. By: Piotr Dominiak (Gdansk University of Technology, Gdansk, Poland); Ewa Lechman (Gdansk University of Technology, Gdansk, Poland); Anna Okonowicz (Gdansk University of Technology, Gdansk, Poland)
    Abstract: The long-run impact of economic growth on total fertility trends is ambiguous and sensitive for in-time variations. Over last decades, economic growth has led in many countries to significant falls in total fertility rates. However, in recent years, in high-income economies a kind of “fertility rebound” is revealed (Goldstein 2009; Luci and Thevenon, 2010; Day 2012). The concept of fertility rebound supports the hypothesis that reversal trends in total fertility rates are mainly attributed to economic growth. The paper unveils the relationship between total fertility rate changes and economic growth in 18 selected countries with fertility rebound observed, over the period 1970-2011. We anticipate uncovering U-shaped impact of economic growth on total fertility rate. To report on the relationship we deploy longitudinal data analysis assuming non-linearity between examined variables. Data applied are exclusive derived from World Development Indicators 2013. Our main findings support the hypothesis on U-shaped relationship between total fertility rate and economic growth in analyzed countries in 1970-2011. Along with the previous we project the threshold level of GDP per capita when the fertility rebound takes place.
    Keywords: fertility rate, fertility rebound, economic growth, panel data analysis.
    JEL: J11 O10 C23
    Date: 2014–05

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