nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2015‒07‒18
twenty-six papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. Protecting Financial Stability in the Aftermath of World War I: The Federal Reserve Bank of Atlanta's Dissenting Policy By Eugene N. White
  2. The Antecedents and Aftermath of Financial Crises as told by Carlos F. Díaz Alejandro By Carmen M. Reinhart
  3. The Federal Reserve System and World War I: Designing Policies without Precedent By Tallman, Ellis W.; Jacobson, Margaret M.
  4. Functional Inequality in Latin America: News from the Twentieth Century By Pablo Astorga
  5. Current Federal Reserve Policy Under the Lens of Economic History: A Review Essay By Williamson, Stephen D.
  6. The Development of Corporate Governance in Toulouse: 1372-1946 By David Le Bris; William N. Goetzmann; Sébastien Pouget
  7. The Economic Legacy of Warfare: Evidence from Urban Europe By Mark Dincecco; Massimiliano Gaetano Onorato
  8. Capital Markets in China and Britain, 18th and 19th Century: Evidence from Grain Prices By Wolfgang Keller; Carol H. Shiue; Xin Wang
  9. Kindleberger and Financial Crises By Piero Pasotti; Alessandro Vercelli
  10. Immovable capital goods in medieval Muslim lands: why water-mills and building cranes went missing By Bas van Bavel; Eltjo Buringh; Jessica Dijkman
  11. Italian Industrial Production, 1861-1913: A Statistical Reconstruction. C. The Non-metallic Mineral Products Industries By Stefano Fenoaltea
  12. Italian Industrial Production, 1861-1913: A Statistical Reconstruction. B. The Extractive Industries By Stefano Fenoaltea
  13. Christianity and Infant Health in India By Menon, Nidhiya; McQueeney, Kathleen
  14. To claim or not to claim? By Arthur M. Downing
  15. Italian Industrial Production, 1861-1913: A Statistical Reconstruction. E. The Metalmaking Industries By Stefano Fenoaltea
  16. Land Access Inequality and Education in Pre-industrial Spain By Francisco J.Beltrán Tapia; Julio Martínez-Galarraga
  17. A necessary disenchantment: myth, agency and injustice in a digital world By Nick Couldry
  18. Italian Industrial Production, 1861 1913: A Statistical Reconstruction. J. The Utilities Industries By Stefano Fenoaltea
  19. Networks in Manuel Castells’ theory of the network society By Anttiroiko, Ari-Veikko
  20. Indices of House Prices and Rent Prices of Residential Property in London, 1895-1939 By Luke Samy
  21. The Interactive Evolution of Economic Ideas and Experience - The Case of Canadian Inflation Targeting By David Laidler
  22. Sraffa and the Labour theory of Value - a note By Anderaos de Araujo, Fabio
  23. Historical Analysis of National Subjective Wellbeing Using Millions of Digitized Books By Hills, Thomas; Proto, Eugenio; Sgroi, Daniel
  24. Whose Preferences Are Revealed in Hours of Work? By Pencavel, John
  25. Can solar activity influence the occurrence of economic recessions? By Gorbanev, Mikhail
  26. Economic Perspectives on DEA By Førsund, Finn

  1. By: Eugene N. White
    Abstract: During the 1920-1921 recession, the Federal Reserve Bank of Atlanta resisted the deflationary policy sanctioned by the Federal Reserve Board and pursued by other Reserve banks. By borrowing gold reserves from other Reserve banks, it facilitated a reallocation of liquidity to its district during the contraction. Viewing the collapse of the price of cotton, the dominant crop in the region, as a systemic shock to the Sixth District, the Atlanta Fed increased discounting and enabled capital infusions to aid its member banks. The Atlanta Fed believed that it had to limit bank failures to prevent a fire sale of cotton collateral that would precipitate a general panic. In this previously unknown episode, the Federal Reserve Board applied considerable pressure on the Atlanta Fed to adhere to its policy and follow a simple Bagehot-style rule. The Atlanta Fed was vindicated when the shock to cotton prices proved to be temporary, and the Board conceded that the Reserve Bank had intervened appropriately.
    JEL: E58 G01 N12 N22
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:21341&r=his
  2. By: Carmen M. Reinhart
    Abstract: Some of the best-known papers of Carlos F. Díaz Alejandro were about Latin America’s crises in the 1980s and 1930s. I will show data, figures and evidence here about the crises in the advanced economies 30 years later that fit the same narrative. His unadulterated words aptly describe modern problems across geographical borders and, in this case, income levels. This attests to his timeless insight and understanding. Because some of the observations he made have general applicability to the study of recurring patterns across crises, I have taken the liberty to label these as lessons.
    JEL: B26 E5 E6 F3 G01
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:21350&r=his
  3. By: Tallman, Ellis W. (Federal Reserve Bank of Cleveland); Jacobson, Margaret M. (Indiana University)
    Abstract: The Federal Reserve System failed to prevent the collapse of intermediation during the Great Depression (1929-1933) and took action as if it was unaware of policies that should have been taken in the event of widespread bank runs. The National Banking Era panics and techniques to alleviate them should have been useful references for how to alleviate a financial crisis. We suggest that the overwhelming effort to finance World War I combined with a perspective held by contemporary Federal Reserve officials that the central bank legislation was sufficient to overcome financial crises are key reasons why the historical experiences were overlooked.
    Keywords: Crisis prevention; liquidity provision; Federal Reserve Act
    JEL: E58 E61 N22
    Date: 2015–07–07
    URL: http://d.repec.org/n?u=RePEc:fip:fedcwp:1510&r=his
  4. By: Pablo Astorga (Institut Barcelona d'Estudis Internacionals (IBEI))
    Abstract: This paper presents a new consistent yearly series of gross income (between-group) inequality Ginis for four occupational categories in Argentina, Brazil, Chile, Colombia, Mexico, and Venezuela over the period 1900-2011 using a newly assembled wage dataset. The approach used differentiates labour by skill level and allows for changing allocation of the labour force over time. Profits and rents are calculated as a residual. Our regional Gini shows a changing secular process with a reclined “S” shape with an inflection point around 1940 and a peak in the 1990s. There are mixed country trends in the early and middle decades, but in most cases inequality was on the rise in the 1960s. There was also a tendency for narrowing wage inequality in the middle decades of the last century – at the time of the Great Levelling in the developed economies – but whose impact was more than off-set by a rising share of the top group. Inequality in the 20th century is a story of increased polarisation - particularly post 1970 – amid significant social mobility.
    Keywords: economic history, economic development, income inequality, Latin America
    JEL: N36 O15 O54
    Date: 2015–04–10
    URL: http://d.repec.org/n?u=RePEc:nuf:esohwp:_135&r=his
  5. By: Williamson, Stephen D. (Federal Reserve Bank of St. Louis)
    Abstract: This review essay is intended as a critical review of Humpage (2015), and it expands on the issues raised in that volume. Federal Reserve Policy during the financial crisis, and in its aftermath are addressed, along with the relationship to historical experience in the U.S. and elsewhere in the world.
    Keywords: Monetary policy; economic history
    JEL: E4 E5 N1
    Date: 2015–07–09
    URL: http://d.repec.org/n?u=RePEc:fip:fedlwp:2015-015&r=his
  6. By: David Le Bris; William N. Goetzmann; Sébastien Pouget
    Abstract: We document a sequence of institutional innovations associated with the corporate form over the course of several centuries in Toulouse. Shareholding companies that began in the 11th century formally incorporated themselves into two large-scale, widely held firms by 1373. In the years that followed they experienced the economic challenges and conflicts we now recognize as inherent in the separation of ownership and control. Using new and existing archival research, we show how the Toulouse firms developed institutional solutions including tradable shares, limited liability, governing boards, cash payout policies, external audits, shareholder meetings and mechanisms for re-capitalization. We examine these developments in the context of institutional economic theory and the received history of the corporation. The Toulouse companies preceded the birth of the Dutch and English East India companies by centuries. The Toulouse firms shed light on the necessary and sufficient conditions for the development of the corporate form. We show that the constellation of features associated with the corporation can appear in situations of relative economic certainty and in the context of Medieval legal code that did not require the granting of governmental approval or patent. The Toulouse firms are a unique case in which the corporation appears as a nexus of private contracts.
    JEL: G30 G34 G35 N0 N2 N8 N83 O16 P1
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:21335&r=his
  7. By: Mark Dincecco (University of Michigan); Massimiliano Gaetano Onorato (IMT Lucca Institute for Advanced Studies)
    Abstract: We show new evidence that the economic legacy of historical warfare persists to the present. Warfare was a key feature of European history. We argue that cities were safe harbors from war threats. War-related urbanization, in turn, had positive consequences for long-run development. We geocode the locations of more than 600 conflicts fought in Europe between 1300 and 1799. To measure urban economic activity, we gather satellite image data on light intensity at night for more than 500 cities between 2000 and 2010. We find a positive, significant, and robust relationship between historical conflict exposure and urban economic activity today. We find that human capital formation and local political representation are two channels through which the consequences of historical warfare are transmitted through time. Our results highlight the military origins of Europe’s prosperous urban belt.
    Keywords: Warfare, Cities, Political and Economic Development, Europe
    JEL: C20 O10 N40 N90 P48 R11
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:ial:wpaper:6/2015&r=his
  8. By: Wolfgang Keller; Carol H. Shiue; Xin Wang
    Abstract: Capital markets allow surplus income to be invested into productivity-enhancing projects. Despite their prominence in general accounts of growth little is known on their role in the emergence of modern economic growth. In this paper we ask whether capital market performance might explain why Britain surged ahead of China in the 18th century. We employ an asset-pricing model together with information on regional grain prices to derive interest rates, and then compare capital market development in large parts of Britain and China. We first calibrate the method and show that it can replicate key features of the United States’ early 19th century capital market, where more systematic data from bank interest rates is available. Using this approach we estimate interest rates for Britain that are at least 20% lower than those for China, for the years 1770 - 1860. Moreover, the regional integration of British capital markets, measured in terms of bilateral interest rate correlations, was far greater than it was in China. The Yangzi Delta correlations come close to the British average at distances below 200 kilometers, but at larger distances interest rate correlations in Britain are twice those of the Delta, and three or more times as high as elsewhere in China. We also find that Britain’s advantage over China in terms of market integration existed already in the late 18th century. Backcasting on the 19th century trends suggests capital market divergence started by the year 1690. Overall, our results provide support for the hypothesis that divergence in capital market development occurred before income divergence, and may therefore be an important factor in explaining the Great Divergence.
    JEL: G12 N10 N13 N25 O10
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:21349&r=his
  9. By: Piero Pasotti (University of Siena); Alessandro Vercelli (University of Siena)
    Abstract: This paper aims to assess to what extent the contributions of Kindleberger to the explanation and control of financial crises may still be a source of valuable insights for the present. Kindleberger had the great merit, to be shared with Minsky, of having resumed in the early 1970s, after an eclipses of more than two decades, the investigation on the intrinsic instability of credit and its impact on financial crises. Though his pure model may be considered less pregnant than that of Minsky, it extends its scope to the international and political aspects of financial crises. In addition Kindleberger provides a powerful support to the model by rooting it in the empirical evidence systematically investigated since the early 18th century. The application of Kindleberger’s model has been successfully extended, with the collaboration of Aliber, also to the financial crises occurred after the publication of his major book (Kindleberger, 1978). This paper argues that Kindleberger’s insights are still invaluable to understand the subprime crisis and the ensuing Great recession and to design the institutions and policies necessary to resume a sustainable path of economic progress.
    Keywords: Kindleberger, Financial Crises, International Lender of Last Resort
    JEL: B26 E52 E58 F33 F34
    Date: 2015–02–01
    URL: http://d.repec.org/n?u=RePEc:fes:wpaper:wpaper104&r=his
  10. By: Bas van Bavel; Eltjo Buringh; Jessica Dijkman
    Abstract: Immovable capital goods such as water-mills were in widespread use in Muslim lands in the early medieval period, just as in the Latin West. In the later Middle Ages, however, vertical windmills and cranes, then widely employed in Europe, were not introduced there, while the number of water-mills dwindled. This decline was concentrated in specific parts of the Muslim world, which rules out time-invariant and generic causes like religion. We show that it was the growing insecurity of property rights and introduction of a specific system of land tenure (ikta) that prevented application of such labor-saving capital goods.
    Keywords: capital goods, Middle East, Middle Ages, great divergence
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:ucg:wpaper:0069&r=his
  11. By: Stefano Fenoaltea
    Abstract: This paper is the third section of Italian Industrial Production, 1861 1913: A Statistical Reconstruction (in progress). It documents the derivation, from the historical sources, of the eight time series that trace the physical product of the kiln-products industry, of the further two series that trace the physical product of processed marble on the one hand, and of other materials on the other, and of the corresponding estimates of value added per unit at 1911 prices. The marble series is based on the apparent consumption of block marble; the others are based on a few benchmarks, interpolated and extrapolated primarily on the basis of construction movements.
    Keywords: method, extractive industries, Italy
    JEL: E01 N13 N53
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:cca:wpaper:414&r=his
  12. By: Stefano Fenoaltea
    Abstract: This paper is the second section of Italian Industrial Production, 1861 1913: A Statistical Reconstruction (in progress). It documents the derivation, from the historical sources, of the 27 time series that trace the physical product of the (abundantly documented) mining industry, of the further five series that trace the physical product of the (largely undocumented) quarrying industry, and of the corresponding estimates of value added per unit at 1911 prices. The quarrying output estimates are derived from the likely consumption of those materials by downstream industries; they are accordingly tied to domestic construction movements, rather than assumed to have followed the path of the documented component of the industry (the production of marble, which was largely exported). The unit value added estimates are presented in two versions: one is the conventional measure, which fails exceptionally to exclude the value of the principal raw material consumed by extractive activity, that is, the valuable stuff under ground; the other is the correct measure of the sector’s industrial value added, using the same definitions as are used for all other industries.
    Keywords: method, extractive industries, Italy
    JEL: E01 N13 N53
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:cca:wpaper:413&r=his
  13. By: Menon, Nidhiya (Brandeis University); McQueeney, Kathleen (Brandeis University)
    Abstract: This paper studies child health in India focusing on differences in anthropometric outcomes between the three main religions – Hindus, Muslims and Christians. The results indicate that Christian infants have higher height-for-age z-scores as compared to infants of other religious identities, and that this is especially true for infant girls in states with a relatively large Christian presence. We instrument for Christian identity today using data on the location of Protestant and Christian missions, the incidence of epidemic diseases and natural disasters, and political crises (wars) that mission establishing countries were engaged in during India's colonial history. The results are robust to a series of checks for instrument validity and omitted variables, and indicate that by inculcating awareness and spreading knowledge on sanitation and the scientific underpinnings of disease, the advent of Christianity has long-term health implications for India's children today.
    Keywords: child health, religion, Christian, Hindu, Muslim, India
    JEL: O12 I15 Z12
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp9177&r=his
  14. By: Arthur M. Downing (All Souls College, Oxford University)
    Abstract: Friendly Societies in New Sealand, 1879-1884 Abstract: Friendly societies were voluntary associations offering members sickness and medical insurance. By the end of the nineteenth century they were one of the most important forms of formal sickness and health insurance around the English-speaking world. A number of historians and economists have argued the competitive advantage of the friendly societies lay in their ability to monitor claims and curtail opportunism. This paper tests this claim, using a newly compiled panel dataset of societies operating in New Zealand in the 1870s and 1880s. The statistical material compiled by the New Zealand Registrar of friendly societies was of exceptional quality. Critically the Registrar collected information on the age structure of members in a large number of societies over a number of years. This allows us to test the impact of various behavioural and financial variables on claims rates, whilst controlling for the age of the members of a society. Regression analysis shows that branches were able to overcome moral hazard in the sense that members did not mechanistically respond to higher benefits scales by claiming more. However friendly societies faced diseconomies of scale. Larger, growing, and rural branches had higher claims rates, either because members responded a more fragile system of monitoring, or because they felt less of a sense of obligation to their society. Moreover an increase in the wealth of a society was associated with an increase in sickness claims. This suggests that members adjusted their behaviour in response to society’s ability to pay, and/or that societies sanctioned more claims when times were good. These two results indicate that members often worked through ill health but were able to claim if a society’s finances were in good health.
    Date: 2015–07–12
    URL: http://d.repec.org/n?u=RePEc:nuf:esohwp:_138&r=his
  15. By: Stefano Fenoaltea
    Abstract: This paper is the fifth section of Italian Industrial Production, 1861 1913: A Statistical Reconstruction (in progress). It documents the derivation, from the historical sources, of the four time series that trace the physical product of the ferrous-metals industry, of the further 12 series that trace the physical product of the non-ferrous-metals industries, and of the corresponding estimates of value added per unit at 1911 prices. The pig iron and rail series are taken almost directly from the sources; the semi-finished wrought iron and steel series extensively corrects the figures in the sources over the later decades, and is estimated from the apparent consumption of pig and scrap, allowing for cast iron, over the early ones; the cast iron series is estimated by interpolating widely separated benchmarks on the assumption that the ratio of cast iron to wrought iron and steel in final consumption followed a smoothly declining path. The non-ferrous-metal ingot production series are taken relatively directly from the sources; the corresponding semi-finished-metal series are typically estimated from the apparent consumption of ingot and scrap metal.
    Keywords: method, manufacturing, Italy
    JEL: E01 N13 N63
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:cca:wpaper:416&r=his
  16. By: Francisco J.Beltrán Tapia (University of Cambridge); Julio Martínez-Galarraga (Universitat de València)
    Abstract: By collecting a large dataset in mid-19th century Spain, this paper contributes to the debate on institutions and economic development by examining the historical link between land access inequality and education. This paper analyses information from the 464 districts existent in 1860 and confirms that there is a negative relationship between the fraction of farm labourers and literacy rates. This result does not disappear when a large set of potential confounding factors are included in the analysis. The use of the Reconquest as a quasi-natural experiment allows us to rule out further concerns about potential endogeneity. Likewise, by employing data on schooling enrolment rates and number of teachers, this paper explores the mechanisms behind the observed relationship in order to ascertain to which extent demand or supply factors are responsible for it. Lastly, the gender composition of the data, which enables distinguishing between female and male literacy levels, together with boys and girls schooling enrolment rates, is also examined.
    Date: 2015–06–01
    URL: http://d.repec.org/n?u=RePEc:nuf:esohwp:_137&r=his
  17. By: Nick Couldry
    Abstract: This lecture reviews the history of how the status and authority of media institutions over the past century have been entangled with wider claims about social knowledge and the order of societies. It analyses those relations in terms of three successive and now overlapping myths: ‘the myth of the mediated centre’ which claims that media (traditional mass media institutions) are privileged access points to our centre of social values and social reality; the ‘myth of us’ which is now emerging around the supposedly natural collectivities that ‘we’ form on commercial social media platforms; and, from outside the media industries, the ‘myth of big data’ which proclaims big data techniques are generating an entirely new and better form of social knowledge. All these myths require deconstruction by a particular hermeneutic, but the case of the myth of big data is the most paradoxical, since its claims amount to an anti-hermeneutic, a refusal to interpret the social anymore as the resultant of processes of meaning-making. This third myth, it is argued, requires a hermeneutic of the anti-hermeneutic if it is to be deconstructed and previous conceptions of social knowledge (from Weber onwards), and the claims to possible justice and politics based upon them, are to be preserved.
    Keywords: media institutions; social knowledge; myth; hermeneutics; social media platforms; big data
    JEL: L91 L96
    Date: 2014–07
    URL: http://d.repec.org/n?u=RePEc:ehl:lserod:57924&r=his
  18. By: Stefano Fenoaltea
    Abstract: This paper is the tenth section of Italian Industrial Production, 1861 1913: A Statistical Reconstruction (in progress). It documents the derivation, from the historical sources, of the eight time series that trace the product of the utilities industries, and of the corresponding estimates of value added per unit at 1911 prices. The electric utilities are relatively well documented by data on capacity and utilization; separate series trace the production (and distribution) of thermal power on the one hand and hydraulic power on the other. The production of the gas utilities is tracked by separate series for gas, coke, and tar. Data are abundant from the 1890s; the estimates for the earlier years are anchored by an early benchmark, but otherwise largely interpolated. The water utilities are represented by separate series for the exceptional Apulian aqueduct, the other aqueducts, and the local distribution systems. The real product of the Apulian aqueduct, still incomplete, is tracked by the embodied capital. The real product of the other aqueducts is tracked by their equivalent ton-kilometers (the square root of the yield, to allow for economies of scale, times length), estimated from cross-section evidence that includes construction dates. The real product of the local nets is measured by their length (augmented to allow for wells and cisterns), itself reconstructed from sporadic local data.
    Keywords: method, utilities, Italy
    JEL: E01 N13 N63
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:cca:wpaper:421&r=his
  19. By: Anttiroiko, Ari-Veikko
    Abstract: This paper discusses the conceptualization of network in Manuel Castells’ theory of network society. Castells’ early academic works were built on the structural analysis of capitalism and social movements in response to the contradictions of capitalist society, without any explicit connection to network analysis. Networks gradually appeared in Castells’ works in the late 1980s, when he became interested in the configuration of the relationships between technology, economy, and society. The culmination of this phase was his opus magnum, The Information Age trilogy, which introduced network as a key concept of his macro theory, even though he remained laconic about the concept itself. This is paradoxical, for Castells became possibly the most prominent figure globally in adopting network terminology in macro sociological theory, but at the same time made hardly any empirical, theoretical or methodological contribution to social network analysis or network theory in general. This implies that ‘network’ in Castells’ social theory is not an analytical concept but rather a powerful metaphor that served to capture his idea of the new social morphology of late capitalism.
    Keywords: Manuel Castells, network, network society, The Information Age, social theory, political economy, capitalist society, late capitalism, informational city, social morphology
    JEL: A13 A14 B31 B51 B52 H11 H7 I0 J6 L16 L23 L5 O1 O2 O3 O33 P1 P16
    Date: 2015–07–15
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:65617&r=his
  20. By: Luke Samy (Winton Institute for Monetary History, University of History, University of Oxford)
    Abstract: Data from two different primary sources were used to construct indices of house prices (HPI) and rents (RRPI) of residential property located in London and the Home Counties between 1895 and 1939. The indices were derived using the hedonics method of price index measurement, which extracts the variation in prices due to differences in the quality of dwellings that form the sample across different time periods. Both nominal and real HPIs and RRPIs are reported in the paper, as well as simple summary statistics on the levels of house prices and rental values, years purchase and returns on housing for a selected number of boroughs in London over time.
    Keywords: housing, rents, inflation, building societies.
    Date: 2015–04–02
    URL: http://d.repec.org/n?u=RePEc:nuf:esohwp:_134&r=his
  21. By: David Laidler (University of Western Ontario)
    Abstract: In Canada, targeting the inflation rate was intended as a temporary measure on a journey to price-level stability, but became a well-established monetary policy regime in its own right. This paper analyses the role of the interaction of economic ideas with the experience generated by their application to policy in bringing about this outcome. In the following account, changing beliefs about the stability or otherwise of ongoing inflation, the capacity of a flexible exchange rate to create a vicious circle of depreciation and rising domestic prices, and about the roles played by the natural unemployment rate and money growth in influencing economic outcomes are emphasised. Today’s standard DSGE approach to modelling inflation targeting arrived on the scene only after the Canadian regime was well established.
    Keywords: Money; Monetary Policy; Inflation; Inflation-targeting; Interest Rates; Unemployment; Exchange Rate
    JEL: B2 E5
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:uwo:epuwoc:20151&r=his
  22. By: Anderaos de Araujo, Fabio
    Abstract: An analysis of the invariable measure of prices proposed by the eminent Italian economist Piero Sraffa, who laid the foundations for a new approach in modern economics. Two mathematical appendices are also provided. The first one shows step by step the construction of the Standard Commodity, which is a consistent solution to the transformation of labour values into prices of production. In Appendix II there is a general numerical example of a price system with two industries which makes the understanding of the distribution of income between wages and profits easier. Using a software spreadsheet, for example, it is possible to make numerical simulations and make comparisons between the results obtained from the Sraffa price system with that obtained from Marx's. This is revised version of the original paper written few years ago.
    Keywords: Sraffa, Standard Commodity, labour values, income distribution
    JEL: A1 B00 B12
    Date: 2015–07–06
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:65557&r=his
  23. By: Hills, Thomas (University of Warwick); Proto, Eugenio (University of Warwick); Sgroi, Daniel (University of Warwick)
    Abstract: We present the first attempt to construct a long-run historical measure of subjective wellbeing using language corpora derived from millions of digitized books. While existing measures of subjective wellbeing go back to at most the 1970s, we can go back at least 200 years further using our methods. We analyse data for six countries (the USA, UK, Germany, France, Italy and Spain). To highlight some results, we find a positive short-run effect for GDP and life expectancy on subjective wellbeing. An increase of 1% life expectancy is equivalent to more than 5% increase in yearly GDP. One year of internal conflict costs the equivalent of a 50% drop in GDP per year in terms of subjective wellbeing. Public debt, on the other hand, has a short-run positive effect. Our estimated index of subjective wellbeing generally does not feature any positive trend, which is consistent with the Easterlin paradox, although we caution against long term analysis given the historical variation of written texts (which parallel similar issues with historical GDP statistics).
    Keywords: historical subjective wellbeing, big data, Google books, GDP, conflict
    JEL: N3 N4 O1 D6
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp9195&r=his
  24. By: Pencavel, John (Stanford University)
    Abstract: It has become orthodox in economics research to interpret the association between hourly earnings and working hours as the expression of the preferences of workers. This convention originated in H. Gregg Lewis' explanation for the decline in hours of work since the nineteenth century. His explanation rested on an explicit resolution of the identification problem inherent in any quantity (hours) - price (wage) relation. For over forty years, researchers have neglected this identification problem with the result that the findings in the purported "labor supply" literature are of questionable value.
    Keywords: working hours, wages, labor supply, labor demand, identification
    JEL: J22 J23 C13
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp9182&r=his
  25. By: Gorbanev, Mikhail
    Abstract: This paper revisits evidence of solar activity influence on the economy. We examine whether economic recessions occur more often in the years around and after solar maximums. This research strand dates back to late XIX century writings of famous British economist William Stanley Jevons, who claimed that “commercial crises” occur with periodicity matching solar cycle length. Quite surprisingly, our results suggest that the hypothesis linking solar maximums and recessions is well anchored in data and cannot be easily rejected.
    Keywords: business cycle, recession, solar cycle, unemployment, sunspot
    JEL: E32 F44 Q51 Q54
    Date: 2015–02
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:65502&r=his
  26. By: Førsund, Finn (Dept. of Economics, University of Oslo)
    Abstract: Research on productive efficiency at the firm level has developed as an important and active strand of research the last decades, both within operations research, management science and economics. However, the interests pursued within the fields have had some differences regarding sound theoretical foundations. The perspective within economics is highlighted and a critique of some research directions judged as unfortunate is offered.
    Keywords: Efficiency measures; data envelopment analysis; shadow prices; weight restrictions; cross efficiency
    JEL: C61 D24
    Date: 2015–04–30
    URL: http://d.repec.org/n?u=RePEc:hhs:osloec:2015_010&r=his

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