nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2016‒07‒02
24 papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. The long-run impact of human capital on innovation and economic development in the regions of Europe. By Claude Diebolt; Ralph Hippe
  2. Tracing the Evolution of Agglomeration Economies: Spain, 1860-1991 By Francisco J. Beltrán Tapia; Alfonso Díez-Minguela; Julio Martinez-Galarraga
  3. Regional human capital inequality in Europe in the long run, 1850 – 2010. By Claude Diebolt; Ralph Hippe
  4. Sraffa, Myrdal and the 1961 Söderström Gold Medal By Rogério Arthmar; Michael McLure
  5. The early years of the primary dealer system By Garbade, Kenneth D.
  6. How much do sociologists write about economic topics? Using big data to test some conventional views in economic sociology, 1890 to 2014 By Daoud, Adel; Kohl, Sebastian
  7. A “Statute of the Firm” as an antitrust law during the Seventies. Guido Carli’s chairmanship of the Italian Industrial Association (Confindustria) By Dafano, Alessandro
  8. House prices in Italy, 1927-2012 By Luigi Cannari; Giovanni D’Alessio; Giovanni Vecchi
  9. Introducing Railway Time in the Balkans: Economic effects of railway construction in Southeast Europe and beyond since the early 19th century until present days By Eduard Alvarez; Mario Holzner; Stefan Jestl; Jordi Marti-Henneberg
  10. Persistencias históricas y discontinuidades espaciales: territorios comunitarios en el Pacífico colombiano By Iván Higuera-Mendieta
  11. The education revolution on horseback II: Using the Napoleonic Wars to elicit the effect of tracking on student performance By Korthals, Roxanne
  12. Are the Japanese Unique? Evidence from Household Saving and Bequest Behavior By Charles Yuji Horioka
  13. Tirole's Industrial Regulation and Organization Legacy in Economics By Fudenberg, Drew
  14. Ancestry and Development: New Evidence By Enrico Spolaore; Romain Wacziarg
  15. Plague, Politics, and Pogroms: The Black Death, Rule of Law, and the persecution of Jews in the Holy Roman Empire By Finley, Theresa; Koyama, Mark
  16. On Historical Household Budgets By Brian A’Hearn; Nicola Amendola; Giovanni Vecchi
  17. Las tasas de variación como una aproximación a los ciclos. El precio de la vivienda en la Comunidad de Madrid (1960-2014) By Susana Cortés Rodríguez
  18. The Big Push: Early Development Economics (1945-1975) By Kartika, Dwintha Maya
  19. A vision about the farming sector’s future: What is in there for farmers in the time of the second machine age? By Rizov, Marian
  20. Backwardness, Industrialisation and Economic Development in Europe By Amat Adarov; Mario Holzner; Luka Sikic
  21. The microeconomics of corruption. A review of thirty years of research By Roberto Burguet; Juan José Ganuza; José Garcia Montalvo
  22. What can we learn about the embeddedness of commercial relationships from the study of powers of attorney?: (France, 18th-19th centuries) By Fabien Eloire; Claire Lemercier; Veronica Aoki Santarosa
  23. The allocation of energy resources in the very long run By Roger Fouquet
  24. Economic growth and agricultural land conversion under uncertain productivity improvements in agriculture By Bruno Lanz; Simon Dietz; Timothy Swanson

  1. By: Claude Diebolt; Ralph Hippe
    Abstract: Human capital is supposed to be an important factor for innovation and economic development. However, the long-run impact of human capital on current innovation and economic development is still a black box, in particular at the regional level. Therefore, this paper makes the link between the past and the present. Using a large new dataset on regional human capital and other factors in the 19th and 20th century, we find that past regional human capital is a key factor explaining current regional disparities in innovation and economic development.
    Keywords: Human Capital, Economic Development, Innovation, Regions, Europe.
    JEL: I25 N90 O18 R11
    Date: 2016
  2. By: Francisco J. Beltrán Tapia; Alfonso Díez-Minguela; Julio Martinez-Galarraga
    Abstract: This article attempts to quantify how the effect of agglomeration economies on population growth has evolved over time. Using district population in Spain between 1860 and 1991, recorded approximately every decade, this article examines whether initial population affects subsequent population growth. Our results show that, while the relationship between these two variables hardly existed during the second half of the 19th century, this link increased significantly between 1910 and 1970, although this trend was abruptly interrupted by the Civil War and the autarkic period that followed. The intensity of this relationship debilitated in the 1970s, a process that continued during the 1980s as rural out-migration diminished and de-industrialisation hit traditional manufacturing sectors. Our findings also stress that agglomeration economies were stronger in medium-size districts, especially from 1960 onwards, thus suggesting that congestion costs began to mitigate the benefits arising from agglomeration economies in the largest locations.
    Keywords: Agglomeration economies, regional growth, Spain
    JEL: N93 N94 O18 R11 R12
    Date: 2016–06–03
  3. By: Claude Diebolt; Ralph Hippe
    Abstract: Human capital is an important factor for economic and social development, as has been underlined by recent theoretical models. A range of contributions has focused on the international evolution of human capital over the last decades and beyond. However, the regional dimension of human capital in Europe remains insufficiently explored, particularly in a long-run perspective. For this reason, this paper addresses this gap in the literature and highlights the regional evolution of human capital in Europe between 1850 and 2010 by using numeracy, literacy and educational attainment proxies. The results show that intranational inequalities in human capital have always been important and are in a number of cases more important than international differences.
    Keywords: Human Capital, Regional Development, Inequality, Europe.
    JEL: N33 N93 O18
    Date: 2016
  4. By: Rogério Arthmar (Department of Economics, Universidade Federal do Espírito Santo); Michael McLure (Business School, University of Western Australia)
    Abstract: This paper reconstructs the awarding of the 1961 Söderström Gold Medal to Piero Sraffa by The Royal Swedish Academy of Sciences. It explains why the prize was created and highlights Gunnar Myrdal’s nomination of Sraffa for the award overseen by the Academy. Primary historical documents are used to establish the amicable relationship between these two economists and to point out their differences and affinities on issues relating to the history of economic thought, particularly in connection with Ricardo’s economics. In addition, Sraffa's activities in Stockholm are detailed, including his contact with Swedish economists and his attendance at the award ceremony. Contemporary reactions in Sweden and Italy to the awarding of this prize to Sraffa are reviewed. The final remarks offer some reflection on the significance of the 1961 Söderström Gold Medal for the history of economics as a field of study.
    Date: 2016
  5. By: Garbade, Kenneth D. (Federal Reserve Bank of New York)
    Abstract: This paper presents a history of the primary dealer system from the late 1930s to the early 1950s. The paper focuses on two formal programs: the “recognized” dealer program adopted by the Federal Reserve Bank of New York in 1939 and the “qualified” dealer program adopted by the Federal Open Market Committee (FOMC) in 1944 and abandoned in 1953. Following his selection as Manager of the System Open Market Account (SOMA) in 1939, Robert Rouse formalized the New York Fed’s system of “recognized” dealer counterparties. Although the Bank typically dealt with recognized dealers, it also did business from time to time with other dealers; neither the original informal system nor the successor formal system made a sharp distinction between the two. The focus of monetary policy changed from managing reserves to keeping interest rates low following the entry of the United States into World War II. To support the new focus, the FOMC replaced the New York Fed’s recognized dealer program with its own program of “qualified” dealers. The new format limited transactions for the SOMA to qualified dealers and imposed a variety of restrictions on those dealers. Following the Treasury-Federal Reserve Accord of March 1951, the FOMC returned stewardship of the primary dealer system to the New York Fed, with instructions to develop a more open system that contemplated transactions with anyone “actually engaged in the business of dealing in Government securities.”
    Keywords: primary dealer; open market operations; System Open Market Account
    JEL: E5 G2 N1
    Date: 2016–06–01
  6. By: Daoud, Adel; Kohl, Sebastian
    Abstract: Sociological self-understanding is that the frequency of economic topics in sociology has peaked twice: first during the classical era between 1890 and 1920 and second after Mark Granovetter's most cited 1985 article. This paper tests this established view using all JSTOR sociology articles from 1890 to 2014 (142,040 articles, 157 journals). Combined topic and multilevel modeling found strong evidence for the first peak but the proportion of economics topics has also been decreasing over the past century. The rise of a New Economic Sociology as a subdiscipline of sociology came with the increasing focus on general economic issues but also with a topic mix of organization and social-theory research. The paper shows that this specific topic mix began to increase from 1929 peaking by 1989 and suggests that the New Economic Sociology, rather than marking the beginning of a second peak, is more a product of the other general currents of organization sociology and social theory. The paper also finds that this subdiscipline is internally diverse in topics and rather male dominated.
    Abstract: Im soziologischen Selbstverständnis gab es zwei Hochphasen in der Häufigkeit der Behandlung von ökonomischen Themen im Rahmen soziologischer Forschung: zunächst in der Zeit der Klassiker zwischen 1890 und 1920 und dann wieder nach Mark Granovetters vielfach zitiertem Artikel von 1985. Das Discussion Paper prüft diese Behauptung unter Verwendung aller bei JSTOR verfügbaren Volltextsoziologieartikel (142.040 Artikel, 157 Zeitschriften). Mithilfe von Topic- und Multilevelmodeling konnten deutliche Belege für die erste Hochphase erbracht werden, wobei der Anteil ökonomischer Themen im Verlauf des vergangenen Jahrhunderts gesunken ist. Das Entstehen der Neuen Wirtschaftssoziologie als Teildisziplin der Soziologie steht sowohl in Zusammenhang mit dem verstärkten Augenmerk auf allgemeine ökonomische Themen als auch mit der Vermischung von Organisationsforschung und Sozialtheorie. Das Paper zeichnet Aufkommen und Verbreitung dieser spezifischen Themenvermischung von 1929 bis zur Hochphase im Jahr 1989 nach und kommt zu dem Ergebnis, dass die Neue Wirtschaftssoziologie eher aus allgemeinen Strömungen von Organisationssoziologie und Sozialtheorie entstanden ist, als dass sie ein Zeichen für den Beginn einer zweiten Hochphase darstellt. Darüber hinaus wird aufgezeigt, dass die Wirtschaftssoziologie intern themenheterogen ist und tendenziell von männlichen Autoren bearbeitet wird.
    Date: 2016
  7. By: Dafano, Alessandro
    Abstract: This paper aims to highlight a newsworthy initiative built up by the Italian Industrial Association which tried to give the Italian economy a forerunner “competition law”; however, in the Seventies Italy proved incapable of tying itself with rules of conduct, which were substituted, empowering an “external constraint”. We will firstly provide an economic and historical-institutional framework of that period; we will then describe the making and the contents of the “Statute of the Firm”, together with a critical analysis on it; finally, we will report some critics around the debate on this proposal, and why the Statute was rejected by entrepreneurs themselves.
    Keywords: competition, Guido Carli, Confindustria, role of the firm, pluralism, innovation, regulation, economic planning.
    JEL: B21 N44 N84 P11 P12
    Date: 2016–06
  8. By: Luigi Cannari (Bank of Italy); Giovanni D’Alessio (Bank of Italy); Giovanni Vecchi (University of Rome “Tor Vergata”)
    Abstract: In this paper we evaluate the trend in house prices and residential land prices from 1927 to 2012. In this period real house prices increased more than threefold, while they quintupled in big cities. The increase was much greater than that of the real construction costs, which doubled. More than two-thirds of the increase in house prices that occurred between 1950 and 2012 was attributable to the increase in residential land prices. The increase in the wealth-to-GDP ratio observed in Italy since the middle of the last century was largely due to the rise in real house prices; although increasing house prices can make buying a home more difficult for non-homeowners, our results mitigate the concerns about the distributive tensions that may arise from the growth in the wealth-to-GDP ratio.
    Keywords: house prices, land prices, wealth, households.
    JEL: N01 R31
    Date: 2016–06
  9. By: Eduard Alvarez; Mario Holzner (The Vienna Institute for International Economic Studies, wiiw); Stefan Jestl (The Vienna Institute for International Economic Studies, wiiw); Jordi Marti-Henneberg
    Abstract: Abstract In this paper we analyse the economic effects of railway infrastructure at the national level for European countries as well as at the local level for Southeast European cities based on a novel railway database capturing decades of the 19th century up to the early 21th century. A panel fixed effects regression analysis at the country level indicates a positive economic impact emanating from railway infrastructure, whereby the effect appears to be even stronger for less developed Southeast European countries. In addition, a linear spatially augmented multilevel model at the city level sheds light on the positive effects resulting from railway infrastructure on urban development. Its positive spillover effects occur within countries as well as across borders.
    Keywords: Railway, infrastructure, Balkans, Southeast Europe, backwardness, urban development, economic development, railway accessibility, infrastructural spillovers, multilevel model, historical analysis
    JEL: L92 N13 N14 N73 N74 N93 N94 O18 O47 R11 R41
    Date: 2016–05
  10. By: Iván Higuera-Mendieta
    Abstract: Los derechos de propiedad han sido asociados comúnmente con la actividad económica. No obstante, esta relación puede ser condicionada por variables como la presencia estatal u otras variables políticas. Este artículo usa una aproximación cuasi-experimental gracias a la delineación de territorios colectivos en el litoral pacífico colombiano a partir de la Ley 70 de 1993 y busca entender el efecto de los esquemas de tenencia de la tierra sobre la actividad económica, medida a través de luces satelitales nocturnas. La propiedad colectiva no parece tener un efecto significativo sobre la actividad económica. Sin embargo, esto está condicionado a la cercanía a las capitales departamentales y antiguos centros coloniales, sugiriendo un equilibrio entre la persistencia histórica y la discontinuidad. ******ABSTRACT: Property rights have been commonly associated with economic activity. Nonetheless, this correlation could be conditioned by other variables such as state presence. This article uses a quasiexperimental approach allowed by the delineation of collective land tenure in the Colombian Pacific and tries to capture how the tenure differences that this delineation creates can affect the economic activity. Private tenure does not have a significant effect, as it is commonly assumed. However, this non-significant effect does not hold when observations are near to a state or colonial capital, suggesting an equilibrium between historical persistence and discontinuity.
    Keywords: Propiedad privada, actividad económica, remote sensing, Ley 70 de 1993, territorios comunitarios
    JEL: O17 C18 O54
    Date: 2016–06–14
  11. By: Korthals, Roxanne (General Economics 2 (Macro))
    Abstract: Previous literature has found inconsistent effects of tracking students in secondary school on student performance using various ways to alleviate the endogeneity in tracking. Sociological literature argues that the threat for war with and invasion by the French around the 1800s induced European countries to introduce mass public education systems. I use this theory to estimate the effect of tracking on student performance in Europe, instrumenting tracking by the political pressure caused by the Napoleonic Wars. The relation between political pressure by Napoleon and tracking is strong and leads in the second stage to a consistent positive effect of tracking on student performance. One important limitation of this analysis is that it is reasonable to assume that political pressure from Napoleon influenced many facets of European countries.
    Keywords: tracking, educational policy, PISA
    JEL: I20
    Date: 2016
  12. By: Charles Yuji Horioka
    Abstract: In this paper, we attempt to shed light on whether Japanese households are rational or if their behavior is influenced by culture and social norms by examining their saving and bequest behavior. To summarize our main findings, we find that Japan’s household saving rate showed great volatility, was often low and even negative, and was high only during the 25-year period from around 1960 until the mid-1980s (if we exclude the war years) and that we can explain the high level of, and trends over time in, Japan’s household saving rate via various socioeconomic and policy variables. This seems to suggest that the Japanese are not a saving-loving people and that their saving behavior is not governed by culture and social norms. Moreover, the bequest behavior of the Japanese suggests that they are less altruistic toward their children and less reliant on their children than other peoples, suggesting that the alleged social norm of strong family ties in Japan is largely a myth, and the Japanese do not appear to be appreciably more concerned about the continuation of the family line or the family business than other peoples, suggesting that the influence of the “ie” system is apparently not so pervasive either. However, we argue that these findings do not necessarily mean that culture and social norms do not matter.
    Date: 2016–06
  13. By: Fudenberg, Drew
    Abstract: Jean Tirole was awarded the 2014 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for his analysis of market power and regulation. This paper provides an overview of some of that work, and of his related contributions to game theory.
    Date: 2015
  14. By: Enrico Spolaore; Romain Wacziarg
    Abstract: We revisit the relation between ancestral distance and barriers to the diffusion of development using a new genomic dataset on human microsatellite variation. With these new data we find a statistically and economic significant effect of ancestral distance from the technological frontier on income per capita, controlling for geographic factors, climatic differences, continental fixed effects and genetic diversity within populations. The historical pattern of the effect is hump shaped, peaking between 1870 and 1913, and declining steeply afterwards. These findings are consistent with the hypothesis that ancestral distance acts as a temporary barrier to the diffusion of innovations and development.
    Date: 2016
  15. By: Finley, Theresa; Koyama, Mark
    Abstract: This paper explores the institutional determinants of persecution by studying the intensity of the Black Death pogroms in the Holy Roman Empire. Political fragmentation exacerbated competition for the rents generated by Jewish moneylending. This competition made Jewish communities vulnerable during periods of crisis. We test this hypothesis using data on the intensity of pogroms. In line with our model, we find that communities governed by Archbishoprics, Bishoprics, and Imperial Free Cities experienced more intense and violent persecutions than did those governed by the emperor or by secular princes. We discuss the implications that this has for the enforcement of the rule of law in weak states.
    Keywords: Black Death, Political Fragmentation, Legal Fragmentation, State Capacity, Jewish History, Persecution
    JEL: K00 N13 N43
    Date: 2016–06–19
  16. By: Brian A’Hearn (Pembroke College, University of Oxford); Nicola Amendola (University of Rome “Tor Vergataâ€); Giovanni Vecchi (University of Rome “Tor Vergataâ€)
    Abstract: The paper argues that household budgets are the best starting point for investigating a number of big questions related to the evolution of the living standards during the last two-three centuries. If one knows where to look, historical family budgets are more abundant than might be suspected. And statistical techniques have been developed to handle the associated problems of small, incomplete, and unrepresentative samples. We introduce the Historical Household Budgets (HHB) Project, aimed at gathering data and sources, but also at creating an informational infrastructure that provides i) reliable storage and easy access to historical family budget data, along with ii) tools to configure the data as it is entered so as to harmonise it with present-day surveys.
    Keywords: Household budgets; household budget surveys; living standards; inequality; poverty; survey; globalization; purchasing power parities; grouped data; poststratification.
    JEL: N30 I31 I32 C81 C83 D60 D63 O12 O15
    Date: 2016–05
  17. By: Susana Cortés Rodríguez
    Abstract: El análisis clásico de series temporales es un enfoque ampliamente difundido y utilizado en la práctica habitual del mundo econométrico sin ninguna clase de reservas (Poveda & Martinez 1973). Sobre esta base, y en particular sobre el uso de tasas de variación, se tratará de demostrar la hipótesis de la existencia de ciclos en el precio de la vivienda en la Comunidad de Madrid. Como es bien conocido, este tipo de análisis se realiza con unas ciertas garantías, a partir de series de datos largas. Uriel (1992) afirma: “… puede considerarse que es pequeña si el número de observaciones es inferior a 60.” Las bases estadísticas nacionales, tanto públicas como privadas, no disponen de series largas por lo que la parte más importante del análisis posterior, radica en la obtención de datos sobre el precio de la vivienda para el periodo 1960/2014.
    Keywords: Precio; vivienda; tasas; ciclos; Madrid.
    JEL: E31 E32 E37
    Date: 2015–12–30
  18. By: Kartika, Dwintha Maya
    Abstract: This article attempts to analyse the strategies, strengths and weaknesses of early development economics, commonly known as the Big Push era. The article starts with the historical analysis on what could influence the thinking of structuralist approach to development. The next section highlights the common strategies proposed by the development pioneers. This is followed by the assessment of industrialisation strategies based on their strengths and weaknesses of the strategies proposed. Finally, the conclusive comments focus on the appreciation of development economics in general.
    Keywords: development economics; economic development; big push; industrialisation; structuralist;
    JEL: O1 O10 O11 O14 O2 O20 O21 O25
    Date: 2014–11
  19. By: Rizov, Marian
    Abstract: Recent technological advances both on the farm and in the lab have made farming more independent form nature than ever before. Arguably, the new and accessible technologies are helping us to better understand and ‘manage’ nature and thus for first time in history farming is becoming as any other industry, susceptible to specialisation and economies of scale. This in turn, besides increased productivity, leads to fundamental organisational change away from family control towards corporate forms with associated implications for employment and rural livelihoods – automation in farming replaces both ‘muscles and brains’.
    Keywords: technology, farming, agriculture, industrial organisation, employment,welfare
    JEL: D2 I38 L23 O33
    Date: 2016–03–01
  20. By: Amat Adarov (The Vienna Institute for International Economic Studies, wiiw); Mario Holzner (The Vienna Institute for International Economic Studies, wiiw); Luka Sikic
    Abstract: Abstract The present work uses long-term economic development data (1952-2010) as well as a detailed industry-level panel data (1963-2011) to analyse industrialisation patterns in Europe, implications of economic backwardness and the role of European integration in facilitating industrialisation and development. We find evidence of some income convergence in Europe, but mostly in countries that were able to exploit the ‘advantages of (mild) backwardness’. Regions of extensive backwardness such as the Balkans had difficulties to catch up. Membership in the European Union helped especially more backward economies to develop faster.
    Keywords: Economic development, economic growth, industrialisation, urbanisation
    JEL: O14 O18 O43 O47
    Date: 2016–06
  21. By: Roberto Burguet; Juan José Ganuza; José Garcia Montalvo
    Abstract: We review microeconomic research on corruption from the last thirty years. We start by analyzing the seminal models of corruption built on three-tier, delegation models. Then, go into more details of the context of corrupt deals, and discuss the main economic factors that a¤ect corruption. We discuss incentives and compensation in bureaucracies, and the interplay of market and bureaucratic structure. Competition and contract design will also be reviewed in relation to procurement under corruptible agents. After reviewing the theoretical contributions, we turn to the empirical evidence. We begin discussing measurement issues, and then move to the analysis of the empirical evidence relative to the theoretical models discussed in previous sections. Finally, we cover several anti-corruption mechanisms proposed in the literature and discuss their relative merits as devices to control or eliminate illegal activities.
    Keywords: Corruption, Bribes, Deterrence, Bureaucracy, Competition, Game Theory, and Mechanism Design.
    JEL: C73 D72 D73 K42
    Date: 2016–05
  22. By: Fabien Eloire (Centre lillois d'études et de recherches sociologiques et économiques); Claire Lemercier (Centre de sociologie des organisations); Veronica Aoki Santarosa (University of Michigan)
    Abstract: This working paper gives the preliminary results of a research project on the uses of notarized powers of attorney in four large French commercial cities in the 18th and 19th centuries. Powers of attorney are often considered as symptoms of trust. We use them to test hypotheses on the embeddedness of commercial relationships. We find little support for the idea of an evolution from embedded to anonymous relationships. We therefore explore alternative hypotheses centered on the complementarity between embeddedness and formality; the importance of repeated interactions; and a broad homophily driving merchants to choose fellow merchants as proxies.
    Keywords: procuration; mandat; notaires; power of attorney; form of proxy; merchants
    Date: 2016–03
  23. By: Roger Fouquet
    Abstract: This paper investigates the Nordhaus (1973) model developed to understand how markets allocate energy resources. In particular, the model proposes that royalties earned by non-renewable energy producers are closely related to the cost of the backstop energy source, the interest rate and the switching date to the backstop energy source. Here, the paper presents the prices of the main and backstop energy sources, extraction costs and royalties, as well as transport costs, taxes and interest rates, over more than five hundred years in Britain to test the model’s ability to explain very long run market behavior. While the model needs a more rigorous analysis, the very long run data and this crude test suggests that certain episodes might be explained by the model and that others do not appear to be. Also, each of the three explanatory variables do appear to be relevant in these explained episodes. In general, though, energy markets appear to be myopic, unaware of the limits of the non-renewable resource being traded, and only in moments of crisis do they consider the finiteness of the resource and, then, perhaps too dramatically, triggering major new technological, infrastructure and R&D investments.
    JEL: N0
    Date: 2015
  24. By: Bruno Lanz; Simon Dietz; Timothy Swanson
    Abstract: We study how stochasticity in the evolution of agricultural productivity interacts with economic and population growth, and the associated demand for food. We use a two-sector Schumpeterian model of growth, in which a manufacturing sector produces the traditional consumption good and an agricultural sector produces food to sustain contemporary population. In addition, sectors differ in that agriculture also demands land as an input, itself treated as a scarce form of capital. In our model both population and sectoral technological progress are endogenously determined, and key technological parameters of the model are structurally estimated using 1960-2010 data on world GDP, population, cropland and technological progress. Introducing random shocks to the evolution of total factor productivity in agriculture, we show that uncertainty optimally requires more land to be converted into agricultural use as a hedge against production shortages, and that it significantly affects both consumption and population trajectories.
    Keywords: Economic growth; Stochastic control; Agricultural productivity; Endogenous innovations; Land conversion; Population dynamics; Food security.
    JEL: O11 O13 O31 J11 C61 Q16 Q24
    Date: 2016–06–03

This nep-his issue is ©2016 by Bernardo Bátiz-Lazo. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.