nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2015‒01‒26
thirty papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. From Hierarchy to Market: the Changing Industrial Organization of Epistemic Communities During Hong Kongs Transition to a Cashless Society (1965-2005) By Bernardo Batiz; Andrew Smith
  2. "Minsky on Banking: Early Work on Endogenous Money and the Prudent Banker" By L. Randall Wray
  3. After communism: 25 years of revolution By Peter Boone
  4. Financial Thought as a Shield: Bogotá’s Stock Exchange and the Financial Ideas during its Foundation and Consolidation By Ramos-Toro, Diego
  5. Baby-Boom, Baby-Bust and the Great Depression By Andriana BELLOU; Emanuela CARDIA
  6. Municipal Housekeeping: The Impact of Women's Suffrage on Public Education By Celeste K. Carruthers; Marianne H. Wanamaker
  7. Economic shocks and unrest in French West Africa By Cornelius Christian; James Fenske
  8. Hans Apel, Samuelson's Economics and Academic Freedom, 1950-57 By Roger Backhouse
  9. Contracts and Cooperation: The Relative Failure of the Irish Dairy Industry in the Late Nineteenth Century Reconsidered By Ingrid Henriksen; Paul Sharp; Eoin McLaughlin
  10. The European crisis in the context of the history of previous financial crises By Michael Bordo; Harold James
  11. Contracts and cooperation: The relative failure of the Irish dairy industry in the late nineteenth century reconsidered By Henriksen, Ingrid; McLaughlin, Eoin; Sharp, Paul
  12. The Polish Transition in a Comparative Perspective / Polska transformacja ustrojowa w perspektywie porównawczej By Anders Aslund; Witold Or³owski
  13. The Swedish industrial relations transformation during the 1970s – abolishing neutrality and affecting the deep structure By Malm Lindberg, Henrik
  14. Understanding the South China Sea: An explorative cultural analysis By Evers, Hans-Dieter
  15. Invisible Women: Entrepreneurship, Innovation and Family Firms in France during Early Industrialization By B. Zorina Khan
  16. The Rise and Fall of Industrialization and Changing Labor Intensity: The Case of Export-Oriented Silk Weaving District in Modern Japan By Tomoko Hashino; Keijiro Otsuka
  17. The Evolution of the Financial Stability Mandate: From Its Origins to the Present Day By Gianni Toniolo; Eugene N. White
  18. Patronage Politics and the Development of the Welfare State: Confederate Pensions in the American South By Shari Eli; Laura Salisbury
  19. The Evolution of Occupational Segregation in the U.S., 1940-2010: Gains and Losses of Gender- Race/ethnicity Groups By Coral del Río; Olga Alonso-Villar
  20. "School’s out for summer, school’s out forever": the long-term health consequences of leaving school during a bad economy By Godard, Mathilde; Garrouste, Clémentine
  21. A Historical Welfare Analysis of Social Security: Who Did the Program Benefit? By William Peterman
  22. Prison Crowding, Recidivism, and Early Release in Early Rhode Island By Howard Bodenhorn
  23. Schumpeter School International Comparative Institutions Database By Sonja Jovicic
  24. The Law of Diminishing Elasticity of Demand in Harrod’s Trade Cycle (1936) By Michaël Assous; Olivier Bruno; Muriel Dal-Pont Legrand
  25. The Institutional Presidency from a Comparative Perspective: Argentina and Brazil since the 1980s By Mariana Llanos; Magna Inácio
  26. Central Bank Credibility: An Historical and Quantitative Exploration By Michael D. Bordo; Pierre L. Siklos
  27. The Italian Corporate System: SOEs, Private Firms and Institutions in a Network Perspective (1952-1983) By Leonardo Bargigli; Renato Giannetti
  28. Rise and Demise of Nehruvian Consensus: A Historical Review By Sharma, Chanchal Kumar
  29. The Limits of Bimetallism By Christopher M. Meissner
  30. Complexity: A Review of The Classics By Bernardo Alves Furtado; Patrícia Alessandra Morita Sakowski

  1. By: Bernardo Batiz (Bangor University); Andrew Smith (University of Liverpool)
    Abstract: This paper documents how computer technology modified retail financial markets in Hong Kong in the period from the 1960s to the early 2000s. The forty years after the deployment of Hong KongÕs first computer in 1965, saw a dramatic change in retail banking technology as Hong Kong moved towards being a cashless society. Prior to that pivotal year, none of the colonyÕs banks used computers whilst retail customers accessed their liquid balances via cash and cheques and only during banking hours. Over time, the ways in which people spent money became more diverse and transformed with the advent of technologies such as the ATM, point of purchase debit card terminals, the Octopus chip, and mobile phone payments. One could construct a straightforward narrative arc that links the acquisition of HSBCÕs first computer in 1967 to the proliferation of electronic payment systems in the twenty-first century. Such a narrative, however, would obscure an important discontinuity in the history of retail payment technology. In the early stages of Hong KongÕs transition to the cashless society, the relevant technologies were installed and managed within the boundaries of large financial intuitions such as HSBC. The second episode discussed in this paper is the successful launch of a micro-payments solution called ÒOctopusÓ. Initially designed as a transport payments card, cash balances stored within a smart chip grew outside financial institutions to become the leading payment solution in small value transactions. Over the course of the period covered by this article, the industrial organization of the relevant technologies transformed as the provision of much of the technology for retail payments had been outsourced to non-bank, non-financial institutions. In other words, the industrial organization of the relevant technologies had been transformed. This paper seeks to account for this shift in the organization of payments technology by drawing on literature around the boundaries of the firm as well as the theory of the firm as an epistemic community. It will be suggested that this process of vertical disintegration (i.e., a shift from hierarchy to markets) took place because of changes in the underlying conditions in Hong KongÕs economy.
    Keywords: cashless, computers, contactless payments, HSBC, Octopus, Hong Kong
    JEL: E42 L63 N85 N25
    Date: 2014–08
    URL: http://d.repec.org/n?u=RePEc:bng:wpaper:14003&r=his
  2. By: L. Randall Wray
    Abstract: In this paper, I examine whether Hyman P. Minsky adopted an endogenous money approach in his early work--at the time that he was first developing his financial instability approach. In an earlier piece (Wray 1992), I closely examined Minsky's published writings to support the argument that, from his earliest articles in 1957 to his 1986 book (as well as a handout he wrote in 1987 on "securitization"), he consistently held an endogenous money view. I'll refer briefly to that published work. However, I will devote most of the discussion here to unpublished early manuscripts in the Minsky archive (Minsky 1959, 1960, 1970). These manuscripts demonstrate that in his early career Minsky had already developed a deep understanding of the nature of banking. In some respects, these unpublished pieces are better than his published work from that period (or even later periods) because he had stripped away some institutional details to focus more directly on the fundamentals. It will be clear from what follows that Minsky's approach deviated substantially from the postwar "Keynesian" and "monetarist" viewpoints that started from a "deposit multiplier." The 1970 paper, in particular, delineates how Minsky's approach differs from the "Keynesian" view as presented in mainstream textbooks. Further, Minsky's understanding of banking in those years appears to be much deeper than that displayed three or four decades later by much of the post-Keynesian endogenous-money literature.
    Keywords: Banks; Deposit Multiplier; Endogenous Money; Financial Innovation; Financial Instability Hypothesis; Horizontalists; Minsky; Originate to Distribute; Prudent Banking; Say’s Law; Securitization
    JEL: B3 B50 B52 E2 E4 E5
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_827&r=his
  3. By: Peter Boone
    Abstract: A quarter of a century after the transition to a capitalist economy began, how are the nations of the former Soviet bloc faring? Peter Boone charts the failures of communism, the chaos that followed its collapse, the period of liberalisation and growth - and today's unhealthy combination of economic stagnation and political repression.
    Keywords: economic history, Soviet Empire, economic reform, economic growth
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:cep:cepcnp:435&r=his
  4. By: Ramos-Toro, Diego
    Abstract: The document uses a historical approach to unveil the political nature of financial ideas generated by functionaries of Bogotá’s Stock Exchange in the years following its foundation. Particularly, it demonstrates how these ideas constituted interpretations that aimed at the consolidation of the entity in a dynamic historical and economic context that posed varying challenges to the institution. The interpretative discourse produced and transmitted by said Stock Exchange constituted an adaptive mechanism, which gradually refined so as to placate both existing and emerging social concerns regarding the role and the effects of an entity of the like.
    Keywords: Financial Ideas, Bogotá’s Stock Exchange, Social and Economic Realities, History of Economic Thought
    JEL: B0 B00 B26 N00 N2 N26
    Date: 2014–10
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:61320&r=his
  5. By: Andriana BELLOU; Emanuela CARDIA
    Abstract: The baby-boom and subsequent baby-bust have shaped much of the history of the second half of the 20th century; yet it is still largely unclear what caused them. This paper presents a new unified explanation of the fertility Boom-Bust that links the latter to the Great Depression and the subsequent economic recovery. We show that the 1929 Crash attracted young married women 20 to 34 years old in 1930 (whom we name D-cohort) in the labor market possibly via an added worker effect. Using several years of Census micro data, we further document that the same cohort kept entering into the market in the 1940s and 1950s as economic conditions improved, decreasing wages and reducing work incentives for younger women. Its retirement in the late 1950s and in the 1960s instead freed positions and created employment opportunities. Finally, we show that the entry of the D-cohort is associated with increased births in the 1950s, while its retirement turned the fertility Boom into a Bust in the 1960s. The work behavior of this cohort explains a large share of the changes in both yearly births and completed fertility of all cohorts involved.
    Keywords: baby boom, baby bust, great depression, added worker effect, retirement, fertility
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:mtl:montec:02-2015&r=his
  6. By: Celeste K. Carruthers; Marianne H. Wanamaker
    Abstract: Gains in 20th century real wages and reductions in the black-white wage gap have been linked to the mid-century ascent of school quality. With a new dataset uniquely appropriate to identifying the impact of female voter enfranchisement on education spending, we attribute up to one-third of the 1920-1940 rise in public school expenditures to the Nineteenth Amendment. Yet the continued disenfranchisement of black southerners meant white school gains far outpaced those for blacks. As a result, women’s suffrage exacerbated racial inequality in education expenditures and substantially delayed relative gains in black human capital observed later in the century.
    JEL: H75 I24 N32
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20864&r=his
  7. By: Cornelius Christian; James Fenske
    Abstract: We show that rainfall, temperature, and commodity price shocks predict unrest in colonial French West Africa between 1906 and 1956. We use a simple model of taxation and anti-tax resistance to explain these results. In the colonial period, the response of unrest to economic shocks was strongest in more remote areas and those lacking a history of pre-colonial states. In modern data spanning 1997 to 2011, the effect of economic shocks on unrest is weaker. Past patterns of heterogeneity are no longer present. The response of unrest to economic shocks, then, differs across institutional contexts within a single location.
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:csa:wpaper:2015-01&r=his
  8. By: Roger Backhouse
    Abstract: This paper presents the story of the attempts made by Hans Apel, after a Professor at Bridgeport University, to defend academic freedom through strengthening the right of instructors to choose their own textbooks. The story began when his university was attacked and threatened with losing donations as a result of its use of Paul Samuelson's introductory textbook and that culminated in an article in the AAUP Bulletin.
    Keywords: Economics, textbooks, academic freedom, Apel, Samuelson
    JEL: B2 B3
    Date: 2014–02
    URL: http://d.repec.org/n?u=RePEc:bir:birmec:14-12&r=his
  9. By: Ingrid Henriksen (University of Southern Denmark); Paul Sharp (University of Southern Denmark); Eoin McLaughlin (School of Geography and Sustainable Development, University of St. Andrews)
    Abstract: Why did the establishment of cooperative creameries in late nineteenth century Ireland fail to halt the relative decline of her dairy industry compared to other emerging producers? This paper compares the Irish experience with that of the market leader, Denmark, and shows how each adopted the cooperative organisational form, but highlights that an important difference was institutional: specifically regarding the enforcement of vertically binding contracts, which are considered to be of vital importance for the successful operation of cooperatives. We argue that this failure, combined with a strong proprietary sector which was opposed to cooperation, reinforced the already difficult conditions for dairying in Ireland due to poor social capital.
    Keywords: Contracts, cooperation, dairying, Ireland
    JEL: K12 L31 N43 N53 Q13
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:sss:wpaper:2015-01&r=his
  10. By: Michael Bordo (Rutgers University); Harold James (Princeton University)
    Abstract: There are some striking similarities between the pre 1914 gold standard and EMU today. Both arrangements are based on fixed exchange rates, monetary and fiscal orthodoxy. Each regime gave easy access by financially underdeveloped peripheral countries to capital from the core countries. But the gold standard was a contingent rule—in the case of an emergency like a major war or a serious financial crisis --a country could temporarily devalue its currency. The EMU has no such safety valve. Capital flows in both regimes fueled asset price booms via the banking system ending in major crises in the peripheral countries. But not having the escape clause has meant that present day Greece and other peripheral European countries have suffered much greater economic harm than did Argentina in the Baring Crisis of 1890.
    Keywords: Gold Standard; Gold Exchange Standard; Debt Crisis; Euro
    JEL: F33
    Date: 2013–07
    URL: http://d.repec.org/n?u=RePEc:bog:spaper:18&r=his
  11. By: Henriksen, Ingrid (University of Southern Denmark); McLaughlin, Eoin (University of St. Andrews); Sharp, Paul (University of Southern Denmark & CAGE)
    Abstract: Why did the establishment of cooperative creameries in late nineteenth century Ireland fail to halt the relative decline of her dairy industry compared to other emerging producers? This paper compares the Irish experience with that of the market leader, Denmark, and shows how each adopted the cooperative organisational form, but highlights that an important difference was institutional: specifically regarding the enforcement of vertically binding contracts, which are considered to be of vital importance for the successful operation of cooperatives. We argue that this failure, combined with a strong proprietary sector which was opposed to cooperation, reinforced the already difficult conditions for dairying in Ireland due to poor social capital.
    Keywords: Contracts, cooperation, dairying, Ireland
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:cge:wacage:2016&r=his
  12. By: Anders Aslund; Witold Or³owski
    Abstract: What a difference a quarter of a century can make! In 1989, Poland stood out as a country in chronic political and economic crisis.1 It had been ravaged by strikes, economic decline and default since 1976. A popular view both in Poland and abroad was that Poland was incurable. Germans talked about the polnische Wirtschaft (Polish economy), meaning dysfunctional economy, while the Swedes used the term polsk riksdag (Polish Parliament) for political disorder. Norman Davies, the great historian of Poland, called his monumental history of Poland God’s Playground because of all the disasters it has faced. He said these words “can be aptly used as an epithet for a country where fate has frequently played mischievous tricks” (Davies 1982, xvi). Today, Poland stands out as possibly the greatest economic success among the thirty post-communist countries.
    Date: 2014–12
    URL: http://d.repec.org/n?u=RePEc:sec:bresem:0133&r=his
  13. By: Malm Lindberg, Henrik (The Ratio institute)
    Abstract: Industrial Relations systems are essentially a nexus of contracts between different actors: Government, employer’s organizations and unions first and foremost. The Swedish labour market model was based on the concept of Government neutrality ie: non-partisanship and non-intervention from the early 20th century. Did the interventionist state during the 1970s change the fundamentals of the Swedish model? I argue that it did. The argument is based on an empirical investigation that comes from the concept “Frontier of Control”. If we take five dimensions: Occupational safety, Determination in work-place issues, Employment and dismissals, Strikes and industrial conflicts and lastly Determination in company issues, the power relations changed fundamentally in the 1970s with the labour law legislation and was ultimately part of a paradigmatic change in Swedish IR.
    Keywords: Industrial Relations; labour law legislation; Government neutrality; political radicalization
    JEL: J53 J58 K31 N34
    Date: 2014–12–31
    URL: http://d.repec.org/n?u=RePEc:hhs:ratioi:0249&r=his
  14. By: Evers, Hans-Dieter
    Abstract: The South China Sea has attracted considerable attention among politicians, journalists and scholars since it has become a contested maritime space. Most works concentrate on conflicts and negotiations to resolve the ensuing issues. In this paper, a cultural theory will be applied to stress the importance of conceptions of space found in different cultures. The South China Sea is defined as "Mediterranean." By comparing it to other maritime spaces, like the Baltic and the Mediterranean Sea, lessons will be drawn from the "longue durée" of history, as analysed by French historian Fernand Braudel and from concepts of the cultural theory of Oswald Spengler. The paper will look at the South China Sea from two perspectives. The political perspective will discuss various events that have happened due to political tensions because of territorial demarcations, fishing rights and access to natural resources. Comparing three "Mediterranean seas," I shall argue that Mediterranean seas share certain properties that give rise to tensions and even armed conflict, but also solutions to its problems. The second perspective uses macro-sociology and cultural anthropology to classify and understand actions of the general population as well as political leaders when they ascertain property rights to Mediterranean seas.
    Keywords: maritime studies, shipping,resources, conflict, China, Indonesia, Malaysia, Brunei, Vietnam, Philippines, history
    JEL: F0 F02 F14 N4 N45 N7 R4 Z13
    Date: 2013–09–01
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:61204&r=his
  15. By: B. Zorina Khan
    Abstract: Family firms are typically associated with negative characteristics, including lower tendencies towards innovation, a higher risk of failure, and inefficiencies deriving from nepotism among family members, criticisms which are even greater when the company is handed over to a female relative. Women in business have generally been presented as petty traders and passive investors, whose entrepreneurial activities were scarce because of such restrictions as limited human capital, culture, market imperfections, and institutional biases. The French economy has similarly been faulted for the prevalence of family firms during the nineteenth century, and for disincentives for the integration of women in the business sector. These issues are explored using an extensive sample of women who obtained patents and prizes at industrial exhibitions during early industrialization. The empirical evidence indicates that middle-class women in France were extensively engaged in entrepreneurship and innovation, and that their commercial efforts were enhanced by association with family firms. Their formerly invisible achievements suggest a more productive role for family-based enterprises, as a means of incorporating relatively disadvantaged groups into the market economy as managers and entrepreneurs.
    JEL: L2 L26 N13 N8 O14 O3
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20854&r=his
  16. By: Tomoko Hashino (Graduate School of Economics, Kobe University); Keijiro Otsuka (National Graduate Institute for Policy Studies)
    Abstract: The production of simple silk fabric, called habutae or habutai, expanded rapidly from 1890 to the end of the 1910s in Fukui prefecture, and it was exported to Europe and the U.S. Habutae was initially woven by hand looms in cottage enterprises and, hence, its production was labor intensive. It gradually became capital intensive with the introduction of power looms since around 1905 but its production as well as export declined precipitously since the late 1910s. We attribute such rising and falling production and export to Japanfs changing comparative advantage of habutae production in international markets associated with changes in production technology from labor-using to capital-using direction.
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:koe:wpaper:1501&r=his
  17. By: Gianni Toniolo; Eugene N. White
    Abstract: We investigate the origins and growth of the Financial Stability Mandate (FSM) to examine why bank supervisors, inside and outside of central banks succeeded or failed to meet their FSM. Three issues inform this study: (1) what drives changes in the FSM, (2) whether supervision should be conducted within the central bank or in independent agencies and (3) whether supervision should be rules- or discretion/principles-based. As histories of bank supervision are few, we focus on the history of six countries where there is sufficient information, three in Europe (England, France, and Italy) and three in the New World (U.S., Canada, and Colombia) to highlight the essential developments in the FSM. While there was a common evolutionary path, the development of FSM in each individual country was determined by how quickly each adapted to changes in the technology of the means of payment and their political economy, including their disposition towards competitive markets and openness to the world economy.
    JEL: E58 G21 N1 N2
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20844&r=his
  18. By: Shari Eli; Laura Salisbury
    Abstract: Beginning in the 1880s, southern states introduced pensions for Confederate veterans and widows. They continued to expand these programs through the 1920s, while states outside the region were introducing cash transfer programs for workers, poor mothers, and the elderly. Using legislative documents, application records for Confederate pensions, and county-level census and electoral data, we argue that political considerations guided the enactment and distribution of these pensions. We show that Confederate pensions programs were introduced and funded during years in which Democratic gubernatorial candidates were threatened at the ballot box. Moreover, we offer evidence that pensions were disbursed to counties in which these candidates had lost ground to candidates from alternative parties.
    JEL: H0 I38 N0 N41 N42
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20829&r=his
  19. By: Coral del Río; Olga Alonso-Villar
    Abstract: The aim of this paper is twofold: a) to explore the evolution of occupational segregation of women and men of different racial/ethnic groups in the U. S. during the period 1940- 2010 and b) to assess the consequences of segregation for each of them. For that purpose, this paper proposes a simple index that measures the monetary loss or gain of a group derived from its overrepresentation in some occupations and underrepresentation in others. This index has a clear economic interpretation. It represents the per capita advantage (if the index is positive) or disadvantage (if it is negative) of the group, derived from its segregation, as a proportion of the average wage of the economy. Our index is a helpful tool not only for academics but also for institutions concerned with inequalities among demographic groups because it makes it possible to rank them according to their segregation nature.
    Keywords: occupational segregation; local segregation; race; ethnicity; gender; wages; U.S.
    JEL: J15 J16 J71 D63
    Date: 2014–12
    URL: http://d.repec.org/n?u=RePEc:vig:wpaper:1405&r=his
  20. By: Godard, Mathilde; Garrouste, Clémentine
    Abstract: This paper investigates whether leaving school in a bad economy deteriorates health in the longrun. We focus on individuals in England and Wales who left full-time education in their last year of compulsory schooling immediately after the 1973 oil crisis. Our identification strategy builds on two sources. First, it relies on the comparison of very similar individuals – born the same year – whose school-leaving behaviour in different economic conditions was exogeneously induced by compulsory schooling laws. More specifically, within a same birth cohort, pupils born at the end of the calendar year (September to December) were forced to leave school almost a year later than pupils born earlier in the year (January to August). Second, we exploit the sharp increase in unemployment rates generated by the 1973 oil crisis. Between 1974 and 1976, each school cohort indeed faced worse economic conditions at labour-market entry than the previous one. Unlike school-leavers who did postpone their entry on the labour market during the 1980s and 1990s recessions, we provide evidence that pupils’ decisions to leave school at compulsory age between 1974 and 1976 were not endogeneous to the contemporaneous economic conditions at labour market entry. We use a repeated cross section of individuals over 1983-2001 from the General Household Survey (GHS) and take a life-course perspective, from 7 to 26 years after school-leaving. Our results show that men who left school in a bad economy have a higher probability of smoking over the whole period (1983-2001) and of having ever smoked. Women who left school in a bad economy are more likely to report poorer health over the whole period under study. They also have a higher probability to restrict their activity due to illness or injury and to consult the General Practitioner. We do not find any significant effects of poor economic conditions at labour-market entry on subsequent labour-market, marriage and fertility outcomes.
    Keywords: General Household Survey; Labour market; School-leavers; Economic crisis; Education; England; Wales;
    JEL: J17 N34 I29
    Date: 2014–12
    URL: http://d.repec.org/n?u=RePEc:dau:papers:123456789/14542&r=his
  21. By: William Peterman (Federal Reserve Board of Governors)
    Abstract: This paper builds a computational life cycle model and simulates the Great Depression in order to assess the historical welfare implications of implementing Social Security during this business cycle episode. A well established result in the literature is that when comparing steady states with and without Social Security in a standard life cycle model, long-run welfare tends to be lower with Social Security. Consistent with these previous results, this paper determines that on average in the steady state the original Social Security program lowers welfare by the equivalent of 4.5% of expected lifetime consumption. Moreover, the likelihood that this Social Security program causes a decrease in an agent's welfare in the steady state is 92%. However, this paper finds that the welfare effects of implementing Social Security on agents in the economy at the time the program is adopted is very different than the long-run welfare effects. In particular these living agents experience an increase in their lifetime welfare due to the implementation of Social Security that is equivalent to 4.4% of their expected future lifetime consumption. Moreover, the paper finds that the likelihood that these living agents experience an increase in their lifetime welfare due to the adoption of the program is 83%. The divergence in the short-run and long-run welfare effects is primarily driven by a slow adoption of payroll taxes and a quicker adoption of benefit payments. This divergence could be one explanation for why a program that decreases long-run welfare was originally implemented.
    Date: 2014
    URL: http://d.repec.org/n?u=RePEc:red:sed014:790&r=his
  22. By: Howard Bodenhorn
    Abstract: Prison overcrowding is a perennial problem and several states are under court order to reduce crowding. The long-term solution to crowding has been more prisons. The short-term solution is early release. Early release programs can be effective when they balance the savings of reduced prison costs against the costs of recidivism by released convicts. This paper uses historical data to investigate how prison officials altered their early release policies in the face of prison crowding and rising real per prisoner detention costs. The empirical evidence is consistent with the hypothesis that prison officials make use of information about the risks of recidivism revealed at trial and during incarceration to make informed decisions about whom to release and when.
    JEL: K14 N00
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20837&r=his
  23. By: Sonja Jovicic (Universität Wuppertal, Fachbereich B, Schumpeter School of Business and Economics)
    Abstract: For our international comparative research on the impact of institutions on economic trends, we put together the Schumpeter School International Comparative Institutions Database. The database comprises the panel data set on various indicators of employment, inequality and labor market institutions in twenty-one OECD countries during the time period 1970-2013. Countries included in the dataset are Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxembourg, Netherlands, Norway, New Zealand, Portugal, Spain, Sweden, the United Kingdom and the United States. The Schumpeter School International Comparative Institutions Database is available as an Excel or Stata file upon request.
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:bwu:schdps:sdp15001&r=his
  24. By: Michaël Assous (PHARE; University of Paris 1); Olivier Bruno (GREDEG CNRS; University of Nice Sophia Antipolis, France; SKEMA Business School; OFCE DRIC); Muriel Dal-Pont Legrand (Clersé CNRS; University of Lille 1)
    Abstract: In The Trade Cycle, Roy Harrod [1936a] propounded the Law of Diminishing Elasticity of Demand. The present paper tries to clarify the precise role Harrod assigned to this law in order to understand his trade cycle theory. We discuss the micro and macro foundations of the Law of Diminishing Elasticity of Demand and how, according to Harrod, it explains one of the main mechanisms that stabilize the economy during the trade cycle. In addition, we show how the Law of Diminishing Elasticity of Demand allowed Harrod to micro-found a non-linear saving function that can give rise to an endogenous countercyclical value of the multiplier. The paper concludes by reviewing the main arguments related to the Law of Diminishing Elasticity of Demand proposed in the late 1930s.
    Keywords: Trade cycle, Imperfect competition, Law of Diminishing Elasticity of Demand, Roy Harrod
    JEL: B22 E32
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:gre:wpaper:2015-02&r=his
  25. By: Mariana Llanos (GIGA German Institute of Global and Area Studies); Magna Inácio (Universidade Federal de Minas Gerais)
    Abstract: This paper focuses on the evolution of the institutional presidency – meaning the cluster of agencies that directly support the chief of the executive – in Argentina and Brazil since their redemocratization in the 1980s. It investigates what explains the changes that have come about regarding the size of the institutional presidency and the types of agency that form it. Following the specialized literature, we argue that the growth of the institutional presidency is connected to developments occurring in the larger political system – that is, to the political challenges that the various presidents of the two countries have faced. Presidents adjust the format and mandate of the different agencies under their authority so as to better manage their relations with the political environment. In particular, we argue that the type of government (coalition or single-party) has had consequences for the structure of the presidency or, in other words, that different cabinet structures pose different challenges to presidents. This factor has not played a significant role in presidency-related studies until now, which have hitherto mostly been based on the case of the United States. Our empirical references, the presidencies of Argentina and Brazil, and typical cases of coalitional as well as single-party presidentialism respectively all allow us to show the impact of the type of government on the number and type of presidential agencies.
    Keywords: Argentina, Brazil, institutional presidency, presidential office, coalition presi-dentialism, comparative political institutions
    Date: 2014–10
    URL: http://d.repec.org/n?u=RePEc:gig:wpaper:259&r=his
  26. By: Michael D. Bordo; Pierre L. Siklos
    Abstract: In this paper we provide empirical measures of central bank credibility and augment these with historical narratives from eleven countries. To the extent we are able to apply reliable institutional information we can also indirectly assess their role in influencing the credibility of the monetary authority. We focus on measures of inflation expectations, the mean reversion properties of inflation, and indicators of exchange rate risk. In addition we place some emphasis on whether credibility is particularly vulnerable during financial crises, whether its evolution is a function of the type of crisis or its kind (i.e., currency, banking, sovereign debt crises). We find credibility changes over time are frequent and can be significant. Nevertheless, no robust empirical connection between the size of an economic shock (e.g., the Great Depression) and loss of credibility is found. Second, the frequency with which the world economy experiences economic and financial crises, institutional factors (i.e., the quality of governance) plays an important role in preventing a loss of credibility. Third, credibility shocks are dependent on the type of monetary policy regime in place. Finally, credibility is most affected by whether the shock can be associated with policy errors.
    JEL: C32 C36 E31 E58 N10
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20824&r=his
  27. By: Leonardo Bargigli (Dipartimento di Scienze per l'Economia e l'Impresa); Renato Giannetti (Dipartimento di Scienze per l'Economia e l'Impresa)
    Abstract: How did business networks among Italian firms evolve over time? We address this question by analyzing the Italian corporate boards network in four years (1952, 1960, 1972, 1983) with network theoretical methods. We find some typical properties of these networks, such as sparsity and connectedness in the same large network component. At the same time, clustering and assortativity are relatively high and stable, while we observe, over time, an increase of the average distance coupled with a decrease of density and of the relative size of the largest component. This is an indication of a rarefaction of connections which is detected also in other national systems. In order to seek the determinants of this phenomenon, we perform a panel regression for the average nodal degree, finding that rarefaction is mostly related to a genuine time trend and only partially to cross-sectional variables. We argue that a possible explanation is a significant increase of concentration which we observe in our dataset, consistently with historical evidence. The network shows a substantial stability in some structures, such as core-periphery subdivision. Looking at the main actors we find a persistent centrality of banks and insurances, as well as of State Owned Enterprises (SOEs). These play a growing role in the community structure of the network, while communities themselves become more and more diversified by sector.
    Keywords: boards networks, network theory, Italian firms.
    JEL: N00 L20 C49
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:frz:wpaper:wp2015_01.rdf&r=his
  28. By: Sharma, Chanchal Kumar
    Abstract: The scholarly terrain of this article charts a course from the making of Nehruvian consensus to the present times. In the true spirit of a social conciliator, Nehru created a system of governance that eschewed left and right extremism. It is this system that is popularly known as Nehruvian Consensus. The mainstream argument is that the old Nehruvian consensus has collapsed but there is no consensus capable of replacing it. This may be true of Nehruvian secularism on which there was a weak consensus right from the beginning, but we must not commit the fallacy of confusing what is true of a part with what is true of the whole. There exists alternative consensus in case of economic policy and conduct of centre-state relations whereas in the case of foreign policy the form may have changed but the substance remains the same. Surprisingly, democracy in India remains resilient in spite of the crisis.
    Keywords: Nehruvian Consensus, Nation building, Democracy, Party system, Economic Planning, Socialism, Industrialization, Modernization, Secularism, Economic Reforms, Foreign Policy, Non-Alignment
    JEL: B3 B31 Z0 Z00
    Date: 2013
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:61356&r=his
  29. By: Christopher M. Meissner
    Abstract: Bimetallism disappeared as a monetary regime in the 1870s. Flandreau (1996) clearly demonstrates that French bimetallism would have been able to withstand the German de-monetization of silver. Could it have withstood if many other countries in the world moved to the gold standard following in the footsteps of Bismarck? The answer is no. By 1875 bimetallism would have been unviable, and the US return to convertibility in 1879 would have made it impossible to sustain true bimetallism. It is difficult to understand the end of the bimetallic strategy as the outcome of a repeated game between rational actors. Rather, it would appear that very few actors had a good model of how the international monetary system worked in practice as of 1873. An attempt to resuscitate bimetallism, with France and the US both bimetallic at the mint ratio of 15.5 to one, would have been tenuous. No wonder then that there were few countries enthusiastic about reviving bimetallism at the International Monetary Conference of 1878. A similar lack of cooperation risks sending the European Monetary Union-as currently constituted-the way of bimetallism.
    JEL: E42 N10 N40
    Date: 2015–01
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:20852&r=his
  30. By: Bernardo Alves Furtado; Patrícia Alessandra Morita Sakowski
    Abstract: This text was written as part of the project Modelling of Complex Systems for Public Policy. It reviews the classical authors who jointly contributed to establish the elements of what could constitute a “science of complexity”. Based on the original writings of these authors, the text discusses the central concepts of complex systems: i) the interaction between (homogeneous or heterogeneous) agents and the environment; ii) emergence and self-organization; iii) the importance of nonlinearity and scales; iv) the determinism of rules; v) the emphasis on dynamics and feedback; and vi) the notions of adaptation, learning and evolution. Finally, contemporary criticisms are presented. They suggest that the arguments of complex systems do not support the epistemological establishment of a supposedly new science, but they do not reject the advances proposed by complexity studies.
    Keywords: complexity; emergence; dynamical systems; non-linearity; cellular automata; modelling; information theory; neural networks; evolution. Este texto está inserido no projeto Modelagem de Sistemas Complexos para Políticas Públicas e faz uma resenha dos autores clássicos que, em conjunto, contribuíram com os elementos do que seria uma “ciência da complexidade”. Com base no pensamento original destes autores, os conceitos centrais de sistemas complexos são discutidos, a saber: i) a interação entre agentes (homogêneos ou heterogêneos) e o ambiente; ii) as propriedades emergentes e a auto-organização; iii) a importância da não linearidade e das escalas; iv) as regras e seu determinismo; v) a ênfase na dinâmica e retroalimentação; e vi) as noções de adaptação, aprendizado e evolução. Por fim, críticas contemporâneas são apresentadas. Elas sugerem que os argumentos de sistemas complexos não sustentam epistemologicamente a constituição de suposta nova ciência, mas não rejeitam os avanços propostos nos estudos de complexidade.
    Date: 2014–12
    URL: http://d.repec.org/n?u=RePEc:ipe:ipetds:2019a&r=his

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