nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2015‒10‒25
25 papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. Wealth-income ratios in a small, late-industrializing, welfare-state economy: Sweden, 1810–2014 By Waldenström, Daniel
  2. Slavery, Path Dependence, and Development: Evidence from the Georgia Experiment By Goodspeed, Tyler
  3. Industry structure, entrepreneurship, and culture: An empirical analysis using historical coalfields By Stuetzer, Michael; Obschonka, Martin; Audretsch, David B.; Wyrwich, Michael; Rentfrow, Peter J.; Coombes, Mike; Shaw-Taylor, Leigh; Satchell, Max
  4. The Political Economy of the Top 1% in an Age of Turbulence: Chile 1913-1973 By Javier Rodríguez Weber
  5. The National Wealth of Sweden, 1810–2014 By Waldenström, Daniel
  6. Towards a History of the Junk Bond Market, 1910-1955 By Peter F. Basile; Sung Won Kang; John Landon-Lane; Hugh Rockoff
  7. War and Inflation in the United States from the Revolution to the First Iraq War By Hugh Rockoff
  8. International Business Cycle Synchronization since the 1870s: Evidence from a Novel Network Approach By Antonakakis, Nikolaos; Gogas, Periklis; Papadimitriou, Theophilos; Sarantitis, Georgios
  9. Fighting the Last War: economists on the lender of last resort By Richard S. Grossman; Hugh Rockoff
  10. Assessing Market (Dis)Integration in Early Modern China and Europe By Daniel Bernhofen; Markus Eberhardt; Jianan Li; Stephen Morgan
  11. Bureaucracy, Collegiality and Public Decision Making: the Case of Eighteenth Century France By Jean Beuve; Eric Brousseau; Jérôme Sgard
  12. Translator and Language Change: On J.R.R. Tolkien’S Translation of Sir Gawain and the Green Knight By Maria A. Volkonskaya
  13. Connections between women`s age at marriage and social and economic development By Silvana Maubrigades
  14. Stalin`s Inventors: Leonid Zherebov and Soviet Pulp Industry, the 1940s-1960s By Elena A. Kochetkova
  15. Clio’s Contributions to Economics and History By Claude Diebolt; Michael Haupert
  16. Capital Account Liberalization and Management By Ocampo Jos. Antonio
  17. Crisis without End: Neoliberalism in a Globalized Environment Modeling the Historic Rise of Neoliberalism and its Systematic Role in Recent Economic Downturns By Rambarran, Richard
  18. The Role of Research and Development in Economic Growth: A Review By Khan, Jangraiz
  19. Dynamic Comovements between Housing and Oil Markets in the US over 1859 to 2013: A Note By Nikolaos Antonakakis; Rangan Gupta; John W. Muteba Mwamba
  20. La construction de la statistique de l'économie sociale et solidaire (ESS) en France : une mobilisation progressive d'acteurs très divers By Danièle DEMOUSTIER; Elisa BRALEY; Thomas GUERIN; Daniel RAULT
  21. Competition and Complementarity of International Financial Centres from A Historical Perspective By Ayumu Sugawara
  22. Flashes from the past: The Origin and development of banking in Bulgaria By Bojinov, Bojidar
  23. Joan Robinson and MIT By Harvey Gram; Geoffrey Harcourt
  24. Going to Extremes: Politics after Financial Crises, 1870-2014 By Funke, Manuel; Schularick, Moritz; Trebesch, Christoph
  25. Lessons from energy history for climate policy By Roger Fouquet

  1. By: Waldenström, Daniel
    Abstract: This paper uses new data on Swedish national wealth over a period of two hundred years to study whether the patterns in wealth-income ratios previously found by Piketty and Zucman (2014) for some very rich and large Western economies extend to smaller countries that were historically backward and developed a different set of political and economic institutions during the twentieth century. The findings point to both similarities and differences. In the pre-industrial era, Sweden had much lower wealth levels than the rest of Europe, and the main explanation is that the Swedes were too poor to save their income. Over the twentieth century, Swedish aggregate trends and levels are much more similar to those of the rest of Europe, but the structure of national wealth differs. In Sweden, government wealth grew much faster and became more important, not least through its relatively large public pension system. This suggests an explicit role of historical economic and political institutions for the long-run evolution of wealth-income ratios.
    Keywords: Economic history; Household portfolios; Institutions; National wealth; Pension wealth; Welfare state
    JEL: D30 E01 E02 N30
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:10878&r=all
  2. By: Goodspeed, Tyler
    Abstract: From 1735 to 1751, the Board of Trustees of the Province of Georgia imposed the only ban on slavery among the North American colonies. Exploiting the historical boundary between the 88 counties of Trustee Georgia and the 71 counties that were appended to the colony after 1751, I analyze the effects of this initial institutional difference on subsequent differences in slave dependence, land inequality, income, and poverty. I find that counties that had been covered by the initial Trustee ban subsequently had lower slave population density, fewer farms holding more than 10 slaves, and higher income and lower poverty rates today. I further find that while counties affected by the ban did not have significant differences in pre-Civil War land inequality, productivity, industrial development, or educational investment, their economic output was significantly more diversified and less reliant upon the production of cash crops. Finally, I demonstrate that controlling for pre-war output diversification significantly reduces the estimated relationship between Trusteeship and current income. Results therefore suggest that the effects of initial differences in labor institutions can persist even where those differences are not determined by geography, and that a primary channel of persistence is the path-dependence of early economic specialization.
    Keywords: institutions, slavery, inequality, development, history
    JEL: N0 O1 Q0
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67202&r=all
  3. By: Stuetzer, Michael; Obschonka, Martin; Audretsch, David B.; Wyrwich, Michael; Rentfrow, Peter J.; Coombes, Mike; Shaw-Taylor, Leigh; Satchell, Max
    Abstract: There is mounting evidence demonstrating that entrepreneurship is spatially clustered and that these spatial differences are quite persistent over long periods of time. However, especially the sources of that persistence are not yet well-understood, and it is largely unclear whether persistent differences in entrepreneurship are reflected in differences in entrepreneurship culture across space as it is often argued in the literature. We approach the cluster phenomenon by theorizing that a historically high regional presence of large-scale firms negatively affects entrepreneurship, due to low levels of human capital and entrepreneurial skills, fewer opportunities for entry and entrepreneurship inhibiting formal and informal institutions. These effects can become self-perpetuating over time, ultimately resulting in persistent low levels of entrepreneurship activity and entrepreneurship culture. Using data from Great Britain, we analyze this long-term imprinting effect by using the distance to coalfields as an exogenous instrument for the regional presence of large-scale industries. IV regressions show that British regions with high employment shares of large-scale industries in the 19th century, due to spatial proximity to coalfields, have lower entrepreneurship rates and weaker entrepreneurship culture today. We control for an array of competing hypotheses like agglomeration forces, the regional knowledge stock, climate, and soil quality. Our main results are robust with respect to inclusion of these control variables and various other modifications which demonstrates the credibility of our empirical identification strategy. A mediation analysis reveals that a substantial part of the impact of large-scale industries on entrepreneurship is through human capital.
    Keywords: Entrepreneurship; entrepreneurship culture; Industrial Revolution; industry structure; personality
    JEL: L26 L64 N13 N53 N94
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67424&r=all
  4. By: Javier Rodríguez Weber (Programa de Historia Económica y Social, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: Until recently, most studies on income inequality were very limited in their aim and scope: the period under study was restricted to the recent decades and income inequality was seen as a pure outcome of market forces. Nevertheless, things are changing. This paper is part of the growing literature which aims to study the political economy of income inequality in the long run. Using a new set of estimates on income inequality in Chile, the main task of this paper is to build a historical argumentation which focuses on the vicissitudes of the political economy of the income share of the top 1% between 1913 and 1973, an age of economic and political turbulence.
    Keywords: Inequality, Top 1%, Chile, Political Economy, Institutions
    JEL: D31 O15 N36
    Date: 2015–09
    URL: http://d.repec.org/n?u=RePEc:ude:doctra:41&r=all
  5. By: Waldenström, Daniel
    Abstract: This study presents a new database, the Swedish National Wealth Database (SNWD), which contains annual data on private, public and national wealth and sectoral saving rates in Sweden over the past two centuries. The paper reviews previous investigations of national wealth, compares their estimates with the new ones and discusses method approaches and measurement problems. Then the main data series are presented for assets and liabilities and their subcomponents, for the private and public domestic and foreign sectors. Complementing the traditional focus on economic flow variables in the past literature on long-run economic developments, this new database offers potentially new perspectives of a number of important issues in the modern economic history of Sweden.
    Keywords: economic history; household portfolios; national wealth; pension wealth; saving
    JEL: E01 H31 N33 N34
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:10882&r=all
  6. By: Peter F. Basile (Department of Economics Rutgers University and AT&T); Sung Won Kang (Korean Economic Research Institute); John Landon-Lane (Department of Economics Rutgers University); Hugh Rockoff (Department of Economics Rutgers University and NBER)
    Abstract: We present a new monthly index of the yield on junk (high yield) bonds from 1910-1955. We then use the index to reexamine some of the main debates about the financial history of the interwar years. A close look at junk bond yields: (1) strengthens the view that the decline in lending standards in the late 1920s was modest at best: (2) casts doubt on the view that the banking crisis that began in 1930 disrupted financial markets because banks liquidated their holdings of risky bonds; (3) strengthens the view that the cost of capital rose substantially in the early 1930s and remained high for the rest of the decade; (4) casts doubt on the view that financial markets entered a liquidity trap in the second half of the 1930s; and (5) strengthens the case for believing that junk bond yields contain some information useful for making economic forecasts.
    Keywords: junk bonds, interest rates, Great Depression
    JEL: N17
    Date: 2015–10–14
    URL: http://d.repec.org/n?u=RePEc:rut:rutres:201514&r=all
  7. By: Hugh Rockoff (Department of Economics Rutgers University)
    Abstract: The institutional arrangements governing the creation of money in the United States have changed dramatically since the Revolution. Yet beneath the surface the story of wartime money creation has remained much the same. During wars against minor powers, the government was able to fund the war by borrowing and levying taxes. In major wars, however, there came a point when further increases in taxes could not be undertaken for administrative or political reasons, and further increases in borrowing could not be undertaken except at higher interest rates; rates that exceeded what was considered fair based on prewar norms. At those moments governments turned to the printing press. The result was substantial inflation.
    Keywords: war, inflation
    JEL: N10
    Date: 2015–10–15
    URL: http://d.repec.org/n?u=RePEc:rut:rutres:201516&r=all
  8. By: Antonakakis, Nikolaos; Gogas, Periklis; Papadimitriou, Theophilos; Sarantitis, Georgios
    Abstract: In this study, we examine the issue of business cycle synchronization from a historical perspective in 27 developed and developing countries. Based on a novel complex network approach, the Threshold-Minimum Dominating Set (T-MDS), our results reveal heterogeneous patterns of international business cycle synchronization during fundamental globalization periods since the 1870s. In particular, the proposed methodology reveals that worldwide business cycles de-coupled during the Gold Standard, though they were synchronized during the Great Depression. The Bretton Woods era was associated with a lower degree of synchronization as compared to that during the Great Depression, while worldwide business cycle synchronization increased to unprecedented levels during the latest period of floating exchange rates and the Great Recession.
    Keywords: Business cycle synchronization; Globalisation; Complex networks; Threshold-Minimum Dominating Set
    JEL: E3 E32 F44 N10 O47
    Date: 2015–10–14
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67223&r=all
  9. By: Richard S. Grossman (Department of Economics Wesleyan University and Institute for Quantitative Social Science Harvard University); Hugh Rockoff (Department of Economics Rutgers University)
    Abstract: In this paper we trace the evolution of the lender of last resort doctrine—and its implementation—from the nineteenth century through the panic of 2008. We find that typically the most influential economists “fight the last war”: formulating policy guidelines that would have dealt effectively with the last crisis or in some cases the last two or three. This applies even to the still supreme voice among lender-of-last-resort theorists, Walter Bagehot, who wrestled with how to deal with the financial crises that hit Britain between the end of the Napoleonic Wars and the panic of 1866. Fighting the last war may leave economists unprepared for meeting effectively the challenge of the next war.
    Keywords: lender of last resort, panic
    JEL: B0 N2
    Date: 2015–10–15
    URL: http://d.repec.org/n?u=RePEc:rut:rutres:201515&r=all
  10. By: Daniel Bernhofen; Markus Eberhardt; Jianan Li; Stephen Morgan
    Abstract: This paper challenges established claims of comparable degrees of market integration in Europe and China on the eve of industrialization. Our empirical strategy focuses on the dynamics of price convergence and accounts for general equilibrium effects arising from common shocks and network effects. Using monthly grain prices for 1740-1820 our analysis uncovers a secular process of market disintegration in 221 prefectures of Qing China. Comparing our results with those for grain price panels from Western Europe we conclude that in terms of market integration the Great Divergence was well under way decades before the start of the 19th century.
    Keywords: Comparison of Chinese and western European market integration, price convergence, common factor model, cross-section dependence.
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:not:notgep:15/12&r=all
  11. By: Jean Beuve (Université Paris 1 Panthéon-Sorbonne (UP1)); Eric Brousseau (EconomiX); Jérôme Sgard (Centre de recherches internationales)
    Abstract: One of the most debated questions in the literature on modern bureaucracies is whether their formal, impersonal rules of decision endow them (rightly or not) with a specific autonomy vis‐à‐vis special interests. We study the case of the Bureau de Commerce, a small, modernizing agency within the illiberal Ancien Régime French monarchy, in charge i.a. of supporting private entrepreneurs. Decision making was founded on the articulation between a vertical administrative organization aimed at collecting information and consulting stakeholders, and two colleges of experts, which discussed cases on a consensual, peers’ basis. We ask whether the relative openness of this procedure led to outright capture by outside rent‐seeking interests, or whether the Bureau could balance them and reach relatively autonomous and consistent decisions. We analyzed how it handled and decided 246 submissions for privileges, or rents, made between 1724 and 1740. We show that the decision to reject, accept entirely or curtail individual submissions was shaped within the administrative procedure – rather than by cliques and clienteles. Each main and competing voice had a significant though differentiated impact on outcomes; and substantive arguments, for or against each application, also had a specific impact.
    Keywords: Industrial policy; Bureaucracy; Mercantilism; Ancien regime France
    Date: 2014–04
    URL: http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/7o52iohb7k6srk09n24rn0e43&r=all
  12. By: Maria A. Volkonskaya (National Research University Higher School of Economics)
    Abstract: Sir Gawain and the Green Knight, an English poem written in the latter half of the 14th century, constitutes an important part of Tolkien’s life as a scholar and translator. The complex language of the poem attracted his attention from the moment Tolkien first encountered it as the Gawain-poet used some native words that were characteristic of Old and Middle English alliterative poetry. On the other hand, more than one third of his vocabulary is not derived from Old English: approximately one tenth of a total of 2650 words has Scandinavian etymologies (although at the time they were no longer considered borrowings, but rather northern dialect words) and about a third is of French origin. In his translation of the poem, Tolkien was primarily interested in special verse words, which resulted in his use of archaic diction such as capadoce ‘a short cape’ or carl ‘man’. However, this study focuses on the second important feature of the vocabulary of the poem: the combination of French and dialect (Scandinavian) words, which are not distributed evenly in the original text. As the author uses the stylistic contrasts between borrowed and native words; he carefully loads some of his lines with French loanwords while others are devoid of them. This paper discusses the stylistic effect thus created by the Gawain-poet and whether Tolkien managed to preserve it in his translation.
    Keywords: Sir Gawain and the Green Knight, Tolkien, translation, Middle English, Modern English.
    JEL: Z
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:hig:wpaper:10/ls/2015&r=all
  13. By: Silvana Maubrigades (Programa de Historia Económica y Social, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: The main aim of this chapter is to examine the historical evidence about marriage patterns in Latin America and critically analyze their possible influence on long–term growth. We will examine the question of whether the European Marriage Pattern can be used to help analyze women’s empowerment in Latin America. This paper tries to explain the link between socioeconomic development and age at first marriage and focuses on eight Latin American countries. Age at first marriage could be interpreted as a measure of women’s bargaining power and can be used as an indicator of the degree of freedom they have when they take the decision to marry. We look at the relation between age at first marriage and the urbanization process, educational improvement and the fertility.
    Keywords: gender inequality, age at first marriage, development
    JEL: N36 O1
    Date: 2015–07
    URL: http://d.repec.org/n?u=RePEc:ude:doctra:39&r=all
  14. By: Elena A. Kochetkova (National Research University Higher School of Economics)
    Abstract: This paper examines Soviet engineer Leonid Zherebov, an inventor of continuous pulp cooker. After twenty-five years of experiments, Zherebov’s design failed, and Soviet factories began to produce pulp using imported Swedish digesters. This article examines the biography of Leonid Zherebov and continuous pulp cooking in order to better understand the nature of Russian technological innovation and its failures. It emphasizes the communication between different institutions involved as well as a range of technological, social, economic and political factors. The paper contends that technological failures were emerged from the failure of Soviet forestry as a technological system due to a lack of open discussion between its builders and the scarcity of resources required for innovation.
    Keywords: Zherebov, innovation, Soviet, continuous cooking, pulp industry
    JEL: N64
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:hig:wpaper:106hum2015&r=all
  15. By: Claude Diebolt (BETA, University of Strasbourg Strasbourg, France); Michael Haupert (University of Wisconsin-La Crosse, USA)
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:afc:wpaper:02-15&r=all
  16. By: Ocampo Jos. Antonio
    Abstract: This paper reviews the history and controversies associated with capital account management. It first looks at the transition from the acceptance at the Bretton Woods conference of capital account regulations as a normal policy instrument to the liberaliz
    Keywords: Accounting, Capital, Financial institutions, International
    Date: 2015
    URL: http://d.repec.org/n?u=RePEc:unu:wpaper:wp2015-048&r=all
  17. By: Rambarran, Richard
    Abstract: Since the 1970’s, both politically and theoretically, neoliberalism as an ideology has been on a persistent rise to the point where, in the twenty first century, it has garnered hegemonic dominance. Despite several recurring crises in countries since the ascendance of neoliberalism, we yet remain reluctant to point out the political economy philosophy as the root cause of the crises. Instead, many of the academics within Economics prefer to offer bouts of highly technical reasons for the downturn- this is especially true and almost solely applicable to those who practice within the ‘neoclassical’ conjecture of Economics. In a typical Marxian sense, one would have to look no further than the economic system to determine both economic and social outcomes of a country. What dictates that economic system however is the political philosophy of the leaders who guide the economic system- the policy makers. This paper attempts to show the neoliberal political philosophy, as the common thread for major crises within the last two decades. It also proposes a societal trinity for which change is driven through complexed interactions among the political, economic and social spheres.
    Keywords: Neoliberalism, Crises, Liberalization, Recession, Financialization, Hegemony
    JEL: O11 O19 P12 P16
    Date: 2015–10–22
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67410&r=all
  18. By: Khan, Jangraiz
    Abstract: Abstract: This paper reviews the role of Research and Development in the economic growth. The paper links back the story of economic growth to the studies of 17th and 18th century. The role of Research and development was confirmed in the models like Romer (1987), Romer (1990), Aghion and Howitt (1992), Grossman and Helpman (1991) and Barro and Sala-i-Martin (2004). In 1990s and 2000s, the empirical investigations made it a significant factor of economic growth. It is therefore conclude on the basis of the reviewed literature that Research and development play a significant role in the economic growth of a country
    Keywords: Research and Development, Economic Growth, Human Capital
    JEL: O31 O32 O47
    Date: 2015–09–30
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67303&r=all
  19. By: Nikolaos Antonakakis (University of Portsmouth, Webster Vienna Private University and Johannes Kepler University); Rangan Gupta (Department of Economics, University of Pretoria); John W. Muteba Mwamba (Department of Economics and Econometrics, University of Johannesburg, Auckland Park, 2006, South Africa)
    Abstract: In this study we examine the dynamic comovements between housing and oil market returns in the US over the period 1859-2013, while controlling for real GDP growth, in flation and interest rate that are known to affect both these markets. As such, we provide a bird's-eye view on the interdependencies between these two markets from a historical perspective. The results of our empirical analysis reveal that comovements between housing and oil market returns are consistently negative over time, apart from several US recessions the US economy experienced in the 19th century, wherein correlations are positive.
    Keywords: Housing market, oil market, dynamic comovements
    JEL: C32 E60 E66 G10
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:pre:wpaper:201579&r=all
  20. By: Danièle DEMOUSTIER (ESEAC - IEP Grenoble, France); Elisa BRALEY (ex CNCRES, France); Thomas GUERIN (CRESS PACA, France); Daniel RAULT (ex conseiller DIES, France)
    Abstract: This paper proposes the history of statistics of Social and Solidarity Economy (SSE) in France, social construct which expresses both the mobilization but also the representations and resistances of various social and institutional players. It emerged from the recognition of Social Economy by national players and public authorities in the 1980s. In spite of a consecutive important involvement of INSEE (Institut national de la statistique et des études économiques), the production of statistics on SSE is still the concern of numerous private actors. While its recognition by its global weight reaches a relatively broad consensus and has allowed the commitment of public authorities including the nomination of a Minister for SSE, whereas the figures become more refined, multiple questions remain on the perimeter, on the categories, on the indicators.
    Keywords: France, social economy, history, statistical measure
    Date: 2015–04
    URL: http://d.repec.org/n?u=RePEc:crc:wpaper:1504&r=all
  21. By: Ayumu Sugawara
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:toh:tmarga:121&r=all
  22. By: Bojinov, Bojidar
    Abstract: The study aims to outline the specifics related with the emergence and development of banking in Bulgaria. The analyzed time period is divided into four parts, wich reflect development of the Bulgarian state. The first period covers the years before the establishment of the Third Bulgarian State (until 1878) and covers development of banking relations in the Ottoman Empire on the territory of the Bulgarian lands. The second period focuses on the development of banking in the newly created Third Bulgarian State (1878-1944) and reflects different aspects of the institutionalization of the state and banks. Third period (1944-1989) focuses on devolution changes in the banking sector came after the nationalization of the banking sector and the imposition of centrally planned economy in Bulgaria. Analysis of the fourth period (after 1989) focuses on the problems of the banking system transition to market relations, and on the causes of the banking crisis (1996-1997).
    Keywords: banks, central bank, Bulgarian national bank, history
    JEL: B00 G21
    Date: 2015–10–15
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:67234&r=all
  23. By: Harvey Gram (Ph. D. Program in Economics, Graduate Center, CUNY); Geoffrey Harcourt (University of New South Wales, Australia)
    Abstract: The great question which has always haunted the type of analysis offered by the MIT economists in answer to Robinson's provocative critique (1953) has always been her own question: how to get into equilibrium? If the notion of "vision at a distance", inherent in dynamic equilibrium analysis (Dorfman, Samuelson, and Solow, 1958) means co-ordination of long-term expectations, recent work shows theory, that "getting into equilibrium" is an impossibility. This vindicates Robinson's position in the capital controversy, at least with respect to the MIT economists.
    Keywords: Joan Robinson, dynamic equilibrium
    JEL: A10 B30
    Date: 2015–10–09
    URL: http://d.repec.org/n?u=RePEc:cgc:wpaper:009&r=all
  24. By: Funke, Manuel; Schularick, Moritz; Trebesch, Christoph
    Abstract: Partisan conflict and policy uncertainty are frequently invoked as factors contributing to slow post-crisis recoveries. Recent events in Europe provide ample evidence that the political aftershocks of financial crises can be severe. In this paper we study the political fall-out from systemic financial crises over the past 140 years. We construct a new long-run dataset covering 20 advanced economies and more than 800 general elections. Our key finding is that policy uncertainty rises strongly after financial crises as government majorities shrink and polarization rises. After a crisis, voters seem to be particularly attracted to the political rhetoric of the extreme right, which often attributes blame to minorities or foreigners. On average, far-right parties increase their vote share by 30% after a financial crisis. Importantly, we do not observe similar political dynamics in normal recessions or after severe macroeconomic shocks that are not financial in nature.
    Keywords: economic voting; financial crises; polarization; policy uncertainty
    JEL: D72 E44 G01
    Date: 2015–10
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:10884&r=all
  25. By: Roger Fouquet
    Abstract: This paper sought to draw lessons from long run trends in energy markets for energy and climate policy. An important lesson is that consumer responses to energy markets change with economic development. In particular, evidence suggests that income elasticities of demand for energy services have tended to follow an inverse-U shape curve. Thus, at low levels of economic development, energy service consumption tends to be quite responsive to per capita income changes; at mid-levels, consumption tends to be very responsive to changes in income per capita; and, at high levels, consumption is less responsive to income changes. The paper also highlights the risks to developing countries of locking-in to carbon intensive infrastructure or behaviours. Without guidance and incentives, rapid economic development is likely to lock consumers into high energy service prices in the long run and bind the economy onto a high energy intensity trajectory with major long run economic and environmental impacts. Thus, effective energy service policies in periods of rapid development, such as in China and India at present, are crucial for the long run prosperity of the economy.
    Date: 2015–09
    URL: http://d.repec.org/n?u=RePEc:lsg:lsgwps:wp209&r=all

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