nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2016‒07‒09
twenty-two papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. Art as an investment in a historical perspective By David, Geraldine
  2. A Confusion of Capital in the United States By O'Sullivan, Mary
  3. "Have We Been Here Before? Phases of Financialization within the 20th Century in the United States" By Apostolos Fasianos; Diego Guevara; Christos Pierros
  4. Irish GDP between the Famine and the First World War By Andersson, Fredrik N. G.; Lennard, Jason
  5. A revolução capitalista By Pereira, Luiz C. Bresser
  6. What’s in an Irish Surname? - Connollys and Others a Century Ago By Cormac Ó Gráda
  7. Key Forces Behind the Decline of Fertility: Lessons from Childlessness in Rouen before the Industrial Revolution By Sandra Brée; David de la Croix
  8. Did the Founding of the Federal Reserve Affect the Vulnerability of the Interbank System to Systemic Risk? By Carlson, Mark A.; Wheelock, David C.
  10. The first debt ceiling crisis By Garbade, Kenneth D.
  11. Tendencias y ciclos de la formación de capital fijo y la actividad productiva en la economía mexicana, 1960-2015 By Moreno-Brid, Juan Carlos; Jamel Kevin, Sandoval; Valverde, Ismael
  12. The pay of labourers and unskilled men on London building sites, 1660 – 1770. By Judy Z. Stephenson
  13. La politica economica della Democrazia Cristiana (1948-1963) e il dibattito all’interno del partito By Dafano, Alessandro
  14. The determinanths of industrialisation in developing countries, 1960-2005 By Guadagno, Francesca
  15. The Microeconomics of Corruption. A Review of Thirty Years of Research By Roberto Burguet; Juan-José Ganuza; José García-Montalvo
  16. Keeping tensions up: A reflexive analysis of the (strategy)-making-of Dolomiti Contemporanee By Maria Lusiani; Gianluca D'Inca' Levis
  17. The long walk to economic freedom after apartheid, and the road ahead By Johan Fourie
  18. Stress, famine and the fetal programming: The long term effect of WWII in Italy By Vincenzo Atella; Edoardo Di Porto; Joanna Kopinska
  19. Religiosity and long-run productivity growth By Herzer, Dierk; Strulik, Holger
  20. Estimación de una función de consumo para la economía cubana en el período 1975- 2012 By Leandro López Elías
  21. The Intimate Link between Income Levels and Life Expectancy: Global Evidence from 213 Years By Jetter, Michael; Laudage, Sabine; Stadelmann, David
  22. Immigration and Economic Growth in the OECD Countries 1986-2006 By Ekrame BOUBTANE; Jean-Christophe DUMONT; Christophe RAULT

  1. By: David, Geraldine (Tilburg University, School of Economics and Management)
    Abstract: This dissertation studies the price formation mechanisms on the art market. More specifically, it uses historical data to test the impact of several factors on the French art market between 1860 and 1950 and on the Belgian art market between 1945 and 1950. The first paper investigates the link between art dealers’ management and artwork pricing. We study the determinants of profit for an art dealer, from the management of inventories to the identity of the buyers. The second paper deals with macro factors and their influence on prices evolution in the first half of the 20th century French art market. This market was the most important art market until the Second World War but has been omitted from previous studies. We compute the risk-return characteristics in order to see if previous studies were downward biased. Further we analyze the art market in times of crisis: the two World Wars and the Great Depression. The third paper (published in Financial History Review) explores the question of art acting as a capital flight tool by focusing on a very particular episode in history: the monetary reform that occurred in Belgium after the Second World War and drastically reduced the money supply. It also addresses the question of the link between art prices and the money supply.
    Date: 2016
  2. By: O'Sullivan, Mary
    Abstract: Thomas Piketty’s book, Capital in the Twenty-First Century, reopens fundamental questions about the role and rewards of capital that economists have never resolved. It does so by exploring the history of capital and derives much of its credibility from the evidence it marshals in defence of its claims. In this paper, I evaluate the basis for Piketty’s arguments by considering them in light of the history of US capitalism. I argue that it is extremely difficult to make economic sense of Piketty’s historical analysis of capital in the US in the 19th and 20th centuries. That is true, only in part, due to the distinctive choices he makes, compared to mainstream economists, in defining and measuring capital. Much more problematic, in fact, are theoretical commitments he shares with them that preclude an understanding of capital’s historical role and rewards in the US economy. Based on a discussion of several important features of US economic history, I have argued that such an understanding demands an historical analysis of capital, both productive and financial capital, in relation to the evolving social organisation of capitalism in the US.
    Keywords: History of capital, Capitalism, Capital theory, Theory of distribution, Finance capital, Productive capital
    JEL: B00 D20 D21 D24 D33 D92 E13 N00 O00
    Date: 2016
  3. By: Apostolos Fasianos; Diego Guevara; Christos Pierros
    Abstract: This paper explores from a historical perspective the process of financialization over the course of the 20th century. We identify four phases of financialization: the first, from the 1900s to 1933 (early financialization); the second, from 1933 to 1940 (transitory phase); the third, between 1945 and 1973 (definancialization); and the fourth period begins in the early 1970s and leads to the Great Recession (complex financialization). Our findings indicate that the main features of the current phase of financialization were already in place in the first period. We closely examine institutions within these distinct financial regimes and focus on the relative size of the financial sector, the respective regulation regime of each period, and the intensity of the shareholder value orientation, as well as the level of financial innovations implemented. Although financialization is a recent term, the process is far from novel. We conclude that its effects can be studied better with reference to economic history.
    Keywords: Financialization; Monetary Regimes; Speculation
    JEL: E42
    Date: 2016–06
  4. By: Andersson, Fredrik N. G. (Department of Economics, Lund University); Lennard, Jason (Department of Economic History, Lund University)
    Abstract: A major issue in Irish economic history is the lack of historical national accounts before the interwar period. This paper addresses the gap with new annual estimates of GDP between 1841 and 1913 based on an original two-step methodology that makes use of existing time series data and of new benchmark estimates of GDP for six census years (Geary and Stark, 2015). On an aggregate basis, the results portray a slowly-growing economy that suffered output losses of a quarter during the Great Famine; on a per capita basis, the standard of living doubled over the period as a whole.
    Keywords: Ireland; GDP; Famine; Historical national accounts
    JEL: C38 E01 N13
    Date: 2016–06–27
  5. By: Pereira, Luiz C. Bresser
    Abstract: The Capitalist Revolution was the period of the transition from the ancient societies to capitalism; it was a long transition that began in North Italy, in the 14th century, and for the first time got completed in England, in the second part of the 18th century, with the formation of the nation state and the Industrial Revolution; it is a major rupture, which divided the history of mankind between a period where empires or civilizations prospered and fell into decadence and disappeared, to a period of ingrained economic development and long-term improvement of standards of living. Since then the different peoples are engaged in the social construction of their nations and their states; since then, they are experiencing economic development, because capitalism is essentially dynamic; since then they are struggling for the political objectives that they historically defined for themselves since that revolution: security, freedom, economic well-being, social justice, and protection of the environment.
    Date: 2016–06–22
  6. By: Cormac Ó Gráda
    Abstract: The digitization of the 1901 and 1911 censuses of Ireland has prompted renewed interest in them as sources for economic and social history. This paper highlights what they tell us about the regional spread of Irish surnames, and what those surnames reveal about Irish cultural history.
    Keywords: Ireland; Culture; Surnames
    JEL: N
    Date: 2016–06
  7. By: Sandra Brée (UNIVERSITE CATHOLIQUE DE LOUVAIN, Centre de Recherche en Démographie et Sociétés); David de la Croix (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and Center for Operations Research and Econometrics (CORE)
    Abstract: To better understand the forces underlying fertility decisions, we look at the forerunners of fertility decline. In Rouen, France, completed fertility dropped between 1640 and 1792 from 7.4 to 4.2 children. We review the list of possible explanations and keep only three: increase in materialism, women's empowerment and increase in returning to education. We propose a theory that shows that we can discriminate between these explanations by looking at childlessness and its social gradient. An increase in materialism or, under certain conditions, an increase in women's empowerment, leads to an increase in childlessness, while an increase in returning to education leads to a decrease in childlessness. Looking at the Rouen data, childlessness is clearly on the rise, from 4% in 1640 to 10% at the end of the 18th century, which appears to discredit the explanation based on increasing returns to education, at least for this period.
    Keywords: Demographic transition, Childlessness, Quality-quantity tradeoff, Forerunners, Women's empowerment
    JEL: J13 N33 O11
    Date: 2016–06–13
  8. By: Carlson, Mark A. (Bank for International Settlements and Board of Governors of the Federal Reserve System); Wheelock, David C. (Federal Reserve Bank of St. Louis)
    Abstract: As a result of legal restrictions on branch banking, an extensive interbank system developed in the United States during the 19th century to facilitate interregional payments and flows of liquidity and credit. Vast sums moved through the interbank system to meet seasonal and other demands, but the system also transmitted shocks during banking panics. The Federal Reserve was established in 1914 to reduce reliance on the interbank market and correct other defects that caused banking system instability. Drawing on recent theoretical work on interbank networks, we examine how the Fed’s establishment affected the system’s resilience to solvency and liquidity shocks and whether these shocks might have been contagious. We find that the interbank system became more resilient to solvency shocks but less resilient to liquidity shocks as banks sharply reduced their liquidity after the Fed’s founding. The industry’s response illustrates how the introduction of a lender of last resort can alter private behavior in a way that increases the likelihood that the lender will be needed.
    Keywords: Federal Reserve System; contagion; systemic risk; seasonal liquidity demand; interbank networks; banking panics; National Banking system
    JEL: E42 E44 E58 G21 N11 N12 N21 N22
    Date: 2016–06–14
  9. By: Alessandro Dafano (Università degli studi Roma Tre)
    Abstract: The aim of this paper is to highlight the intellectual influence of Keynes in the building of Italian econometrics and how our scholars tried to find a way out from the stagflation occurred in Italy during the Seventies. We have chosen two case studies: the model designed by PROMETEIA, the think tank belonging to the University of Bologna, and DYANMOD, the main model of Confindustria (Confederation of Italian Industries). Although the Keynesian thought crucially influenced their structure and functioning, they managed to explain also the oil-shock-induced supply side effects, showing an unexpected degree of innovation within Keynesian thought. Furthermore, these models were conceived to join the larger Project LINK by Lawrence Klein, in order to connect the economies of many OECD countries. Given our microeconomic foundations, the main conclusions traced by these models were the focus on balance of payments equilibrium, capital accumulation and public finance constraints, thus asking for economic policies that could guarantee growth and disinflation.
    Keywords: econometrics, oil shock, Lawrence Klein, John Maynard Keynes, neoclassical synthesis, Nino Andreatta, Guido Carli.
    JEL: B23 B31 E12 E65
    Date: 2016
  10. By: Garbade, Kenneth D. (Federal Reserve Bank of New York)
    Abstract: In the second half of 1953 the United States, for the first time, risked exceeding the statutory limit on Treasury debt. This paper describes how Congress, the White House, and Treasury officials dealt with the looming crisis—by deferring and reducing expenditures, monetizing “free” gold that remained from the devaluation of the dollar in 1934, and, ultimately, raising the debt ceiling.
    Keywords: debt ceiling; monetization of gold; U.S. Treasury
    JEL: E42 H63 N22
    Date: 2016–06–01
  11. By: Moreno-Brid, Juan Carlos; Jamel Kevin, Sandoval; Valverde, Ismael
    Abstract: En este artículo se analiza la inversión y su relación con el crecimiento de la actividad productiva desde una perspectiva de largo plazo que distingue dos etapas en la evolución de la economía mexicana. La primera abarca de 1960 a 1981, años en que el modelo de desarrollo se centró en la industrialización dirigida por el Estado. La segunda cubre 1988-2015, ya bajo una pauta marcada por una serie de reformas orientadas a priorizar la estabilización macroeconómica nominal y reducir el papel del estado en la esfera económica. En este empeño se examinan las tendencias y fluctuaciones cíclicas de la inversión y del PIB, así como su correlación en las fases de impulso y de retraimiento.
    Date: 2016–05
  12. By: Judy Z. Stephenson (Cambridge Groups for the History of Population and Social Studies)
    Abstract: This paper presents evidence of pay to workers at the lower end of the building trades in long eighteenth century London. Traditionally, the pay of labourers has been recorded as a proxy for unskilled workers. In fact, the labourers whose charge-out rates have been recorded were mostly semi-skilled. There were many who earned far less than ‘labourers’ by day rate or by other means. Using the records of large London construction projects over the long term I propose a new taxonomy, and provide a new working wage series for both semi-skilled labourers and unskilled men for London for the eighteenth century.
    Keywords: Wages, Building trades, Skill, Eighteenth-century England
    JEL: N0 N33 N93
    Date: 2016–03–29
  13. By: Dafano, Alessandro
    Abstract: This paper aims to analyze, in a first part, the economic policy carried out by the Christian Democracy from the post WWII until the early Sixties; in a second part, the goal is to trace the debate inside this party to highlight the different positions taken by its members in order to understand why those kind of policies were achieved. We will see that, a first period of unity (largely) within the party, together with a second one where the left-wing component came out and succeeded to lead the party, made possible to design Keynesian based policies in order to boost growth and employment that our country needed.
    Keywords: programmazione economica, miracolo economico, Democrazia Cristiana, ricostruzione postbellica, Amintore Fanfani, Ezio Vanoni, Pasquale Saraceno, Ferdinando di Fenizio, Cassa per il Mezzogiorno.
    JEL: B22 B31 E65 N14
    Date: 2016–06
  14. By: Guadagno, Francesca (UNU‐MERIT, Maastricht University, and UNCTAD)
    Abstract: Industrialisation is generally considered a synonym of economic development. This paper contributes to the literature on the engine of growth hypothesis with an empirical analysis of the determinants of industrialisation. The paper goes back to the Cornwall (1977) model of manufacturing as an engine of growth and estimates the first equation of the model, i.e. the equation of manufacturing output growth. Hausman and Taylor models are estimated for a sample of 74 countries for the period 1960-2005. The results indicate that industrialisation is faster for larger countries with an undeveloped industrial base, strong export performance, and undervalued exchange rates. Skills and knowledge accumulation played an increasingly important role since the mid-1990s. Robustness checks corroborate the validity of these findings.
    Keywords: industrialisation, manufacturing sector, technological change, industrial policy
    JEL: O10 O14 O25
    Date: 2016–05–21
  15. By: Roberto Burguet; Juan-José Ganuza; José García-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 affect 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, Mechanism Design
    JEL: C73 D72 D73 K42
    Date: 2016–06
  16. By: Maria Lusiani (Dept. of Management, Università Ca' Foscari Venice); Gianluca D'Inca' Levis (Dept. of Management, Università Ca' Foscari Venice)
    Abstract: Adopting a process ontology and a strategy-as-practice lens, this paper explores the (often tacit) dimension of strategy work in cultural entrepreneurship. Drawing on a peculiar combination of auto-ethnography and more traditional observation and interview methods, the paper reconstructs the birth and becoming of Dolomiti Contemporanee, a major art curatorial project. From an analysis of the curator/entrepreneur actions, interactions and beliefs, two main elements emerge that explain the peculiarities of strategizing in this setting: the centrality of ÒtensionsÓ and Òcultural attitudeÓ. Tensions of several kinds are constitutive to the project, whose birth and becoming need the ability to create and keep tensions up continuously, not to solve or to manage them. However, these are sustained by an underlying, organic and passionate view of the whole project in its becoming, something that we call Òcultural attitudeÓ. These findings allow for a discussion of some features of cultural entrepreneurship and also of research-practice reflexivity and learning.
    Keywords: strategizing, process studies, tensions, cultural entrepreneurship, reflexive practice, auto-ethnography
    JEL: M1
    Date: 2016–04
  17. By: Johan Fourie (Department of Economics, University of Stellenbosch)
    Abstract: As South Africa moves further away from the political transition of 1994, the economic history of the post-apartheid era is coming up for debate. The optimism generated by the ANC’s early successes must now, after more than two decades of democracy, be tempered by its conspicuous failures. Not all is lost, though. African growth, technological innovation and private-sector participation in public sector services offer credible opportunities for accelerated development, but will only be effective if policy-makers are cognizant of the political realities. The long walk to economic freedom for many will, unfortunately, continue along a rocky gravel road.
    Keywords: South African economy, democracy, post-apartheid, poverty, inequality, growth, development, Thabo Mbeki, Jacob Zuma, Trevor Manuel
    JEL: O55 N17
    Date: 2016
  18. By: Vincenzo Atella (CEIS,University of Rome "Tor Vergata"); Edoardo Di Porto (University of Naples Federico II, CSEF and UCFS Uppsala University); Joanna Kopinska (CEIS, University of Rome "Tor Vergata")
    Abstract: This paper analyses the effect of in utero and at birth exposure to WWII intensity on long-run health and economic outcomes. We link individual clinical electronic records collected by General Practitioners (GPs) for a large sample of Italian adults with detailed information on the intensity of exposure to WWII con ict, disaggregated by month and province of birth. Under weak assumptions, which we discuss and test carefully, our analysis provides a lower bound of the long-run causal effect of WWII intensity on adult health. We show that individuals exposed to intense WWII con icts while in utero are more likely to present health problems In particular, we find that early life stress caused by the war increases the probability of Dislipidemia and Depression, while famine increases the probability of Diabetes and Obesity. We find that these effects are heterogeneous across the trimester of exposure during pregnancy and across moments of outcome realisation later in life.
    Keywords: War exposure; Stress; Famine; Fetal programming; Charlson Index; Chronic diseases; Health expenditure; Italy.
    JEL: D14 I13 G11
    Date: 2016–06–23
  19. By: Herzer, Dierk; Strulik, Holger
    Abstract: In this paper, we show, using a panel of developed countries, that there is a long-run negative association between church attendance and total factor productivity (TFP) with predictive causality running from declining church attendance to increasing factor productivity. According to our preferred estimate, about 18% of the increase in TFP from 1950 to 1990 is caused by declining religiosity. In order to explain this phenomenon, we integrate into standard R&D-based growth theory a micro-foundation of individual cognitive style, which is either intuitive-believing or reflective-analytical. Under the assumption that R&D productivity is positively influenced by a reflectiveanalytical cognitive style, we find that secularization leads to an increasing labor share in R&D and gradually increasing productivity growth. We use these insights to reflect on trends in religiosity and R&D-based growth in the very long run, from Enlightenment to the present day.
    Keywords: religiosity,church attendance,factor productivity,cognitive style,R&D-based growth
    JEL: N30 O11 C23
    Date: 2016
  20. By: Leandro López Elías
    Abstract: Este artículo tiene como objetivo estimar una función de consumo de los hogares para la economía cubana en el período 1975-2012. Para ello se realiza un análisis de series de tiempo. Los principales resultados obtenidos indican que la teoría keynesiana es la que más se ajusta para explicar el comportamiento del consumo en la economía cubana. El Producto Interno Bruto (PIB) y la variable Otros Ingresos explican las decisiones de consumo de los agentes. Según los supuestos asumidos sobre las variables exógenas del modelo se espera que el consumo de hogares muestre una tasa de crecimiento promedio de 5,4 % en el período 2013-2020.
    Keywords: Consumo, Series de Tiempo, Hogares
    JEL: C32 E21
    Date: 2015–12–04
  21. By: Jetter, Michael (University of Western Australia); Laudage, Sabine (University of Bayreuth); Stadelmann, David (University of Bayreuth)
    Abstract: Contrary to previous findings, we find a systematic and economically sizeable relationship between income levels and life expectancy in a panel dataset of 197 countries over 213 years. By itself, GDP/capita explains more than 64 percent of the variation in life expectancy. The Preston curve prevails, even when accounting for country- and time-fixed effects, country-specific time trends, and alternative control variables. Quantile regressions and instrumental variable estimations suggest this link to be persistent across different levels of life expectancy and unaffected by reverse causality. If policymakers want to prolong people's lives, economic growth appears to be the predominant medicine.
    Keywords: historical panel data, income levels, life expectancy, quantile regression analysis
    JEL: I15 I31 J11 H51
    Date: 2016–06
  22. By: Ekrame BOUBTANE; Jean-Christophe DUMONT; Christophe RAULT
    Date: 2015

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