|
on Business, Economic and Financial History |
|
Issue of 2017‒05‒07
27 papers chosen by |
| By: | Junichi Yamasaki |
| Abstract: | Railroad access can accelerate the technological progress in the industrial sector and therefore induce structural change and urbanization, the two common features of modern economic growth. I examine this particular mechanism in the context of Japanese railroad network expansion and modern economic growth in the late 19th century and early 20th centuries. By digitizing a novel data set that measures the use of steam engines at the factory level, allowing me to directly observe the diffusion of steam power, I analyze the effect of railroad access on the adoption of steam power. To overcome the endogeneity prob- lem, I determine the cost-minimizing path between destinations, and use this to construct an instrument for railroad access. I find that railroad access led to an increased adoption of steam power by factories, which in turn reallocated labor from the agricultural to the industrial sector, thereby inducing structural change. Railroad network also broke mean reversion in population growth, eventually leading to urban- ization. My results support the view that railroad network construction was key to the modern economic growth in pre-First World War Japan. |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1000&r=his |
| By: | Desmet, Klaus; Greif, Avner; Parente, Stephen L. |
| Abstract: | Why do some countries industrialize much earlier than others? One widely-accepted answer is that markets need to be large enough for producers to find it profitable to bear the fixed cost of introducing modern technologies. This insight, however, has limited explanatory power, as illustrated by England having industrialized nearly two centuries before China. This paper argues that a market-size-only theory is insufficient because it ignores that many of the modern technologies associated with the Industrial Revolution were fiercely resisted by skilled craftsmen who expected a reduction in earnings. Once we take into account the incentives to resist by factor suppliers' organizations such as craft guilds, we theoretically show that industrialization no longer depends on market size, but on the degree of spatial competition between the guilds' jurisdictions. We substantiate the relevance of our theory for the timing of industrialization in England and China (i) by providing historical and empirical evidence on the relation between spatial competition, craft guilds and innovation, and (ii) by showing that a model of our theory calibrated to historical data on spatial competition correctly predicts the timing of industrialization in both countries. The theory can therefore account for both the Industrial Revolution and the Great Divergence. |
| Keywords: | adoption of technology; craft guilds; endogenous institutions; Great Divergence; industrial revolution; innovation; inter-city competition; market size; spatial competition |
| JEL: | N10 O11 O14 O31 O43 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11976&r=his |
| By: | Yang Hu (University of Waikato); Les Oxley (University of Waikato) |
| Abstract: | In this study, we empirically investigate evidence of explosive behaviour in the British share prices of canals, railways and waterworks in the nineteenth century using the right-tailed unit root test of Phillips, Shi and Yu (2015, PSY). Of particular interest to the Railway Mania in the 1840s, our results provide evidence of exuberance in share prices of railways during the most remarkable events in history. In addition, we find signs of exuberance in canals and waterworks share prices. Our findings will be of great interest to both economic historians and scholars who are interested in the rage of speculation in historical share prices during the Railway Mania. |
| Keywords: | explosive behaviour; exuberance; generalized sup ADF test; railway mania |
| JEL: | C12 N2 |
| Date: | 2017–04–28 |
| URL: | http://d.repec.org/n?u=RePEc:wai:econwp:17/09&r=his |
| By: | Reo Shimamura (Office of Research Development and Sponsored Projects, Mita Campus, Keio University) |
| Abstract: | This paper shows the introduction process and the historical development of the environmental tax in the Netherlands. Why was the environmental taxes introduced in the Netherlands? The environmental taxes have replaced environmental charges and developed. As the citizen's environmental awareness increased in the late 1980s, the introduction of environmental taxes had been boosted by political situation. The turning point was the election and the National Environmental Policy Plan in 1989. In addition, it was also an important point that the increase of environmental taxes was consistent with tax reform of the Lubbers administration and the Kok administration. |
| Keywords: | Netherlands, environmental tax, political process, polder model |
| JEL: | H23 Q58 |
| Date: | 2017–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:keo:dpaper:2017-011&r=his |
| By: | Angel De la Fuente |
| Abstract: | En este trabajo se construyen series “homogeneas†anuales de VAB y PIB a precios corrientes y constantes y de puestos de trabajo para las regiones españolas durante el periodo 1955-2014. Estas series se obtienen enlazando la Contabilidad Regional del INE con las series elaboradas por Julio Alcaide y colaboradores para la Fundación BBVA. |
| Keywords: | Analisis Regional , Documento de Trabajo , España |
| JEL: | E01 R1 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:bbv:wpaper:1710&r=his |
| By: | Seiichiro Mozumi (Faculty of Economics, Keio University) |
| Abstract: | On December 30, 1969, Richard Nixon signed the Tax Reform Act of 1969-originally crafted by the Treasury Department during the presidency of Lyndon B. Johnson-into law. Some scholars who discussed the tax reform have evaluated that it succeeded in making the federal tax system somewhat fairer, simpler, and more equitable, while the others have pointed out that its legislative process exemplified the quandary of comprehensive tax reform; this paper analyzes and demonstrates the conflict regarding with the tax reform between tax reform proponents, such as the Treasury Department and Democrats in Congress, and the Johnson administration. The unenthusiastic Johnson administration, and particularly the CEA's argument of temporary tax surcharge based on "domesticated Keynesianism," delayed the proposal and legislation of the tax reform until the Nixon presidency, and doomed the ideal tax reform that the Treasury crafted on the basis of the concept of "tax expenditures." With greater support of the Johnson administration, the Tax Reform Act of 1969 could have not only made the federal tax system so much fairer and more equitable, but also restored the taxation -expenditure nexus the Kennedy-Johnson tax cut of 1964 had broken. |
| Keywords: | Comprehensive tax reform, tax expenditures, domesticated Keynesianism |
| JEL: | H2 N42 |
| Date: | 2017–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:keo:dpaper:2017-009&r=his |
| By: | Humphries, Jane; Weisdorf, Jacob |
| Abstract: | Existing accounts of workers' earnings in the past suffer from the fundamental problem that annual incomes are inferred from day wages without knowing the length of the working year. We circumvent this problem by presenting a novel income series for male workers employed on annual contracts. We use evidence of labour market arbitrage to argue that existing estimates of annual incomes in England are badly off target, because they overestimate the medieval working year but underestimate the working year during the industrial revolution. Our revised income estimates suggests that modern economic growth began more than two centuries earlier than commonly thought and was driven by an early and continuing "Industrious Revolution". |
| Keywords: | England; Industrial Revolution; Industrious Revolution; Labour Supply; Living standards; Malthusian Model; Real Wages |
| JEL: | J3 J4 J5 J6 J7 J8 N33 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11999&r=his |
| By: | Blum, Matthias; De Bromhead, Alan |
| Abstract: | This paper explores the relationship between Nazi membership and social mobility using a unique and highly detailed dataset of military conscripts and volunteers during the Third Reich. We find that membership of a Nazi organisation is positively related to social mobility when measured by the difference between fathers' and sons' occupations. This relationship is stronger for the more 'elite' NS organisations, the NSDAP and the SS. However, we find that this observed difference in upward mobility is driven by individuals with different characteristics self-selecting into these organisations, rather than from a direct reward to membership. These results are confirmed by a series of robustness tests. In addition, we employ our highly-detailed dataset to explore the determinants of Nazi membership. We find that NS membership is associated with higher socio-economic background and human capital levels. |
| Keywords: | National Socialism,Third Reich,Social Mobility,Nazi Membership,Second World War,Political Economy,Germany,Economic History |
| JEL: | J62 N24 N44 P16 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:qucehw:201704&r=his |
| By: | Brodeur, Abel (University of Ottawa); Lekfuangfu, Warn N. (Chulalongkorn University); Zylberberg, Yanos (University of Bristol) |
| Abstract: | This paper analyzes the determinants behind the spatial distribution of the sex industry in Thailand. We relate the development of the sex industry to an early temporary demand shock, i.e., U.S. military presence during the Vietnam War. Comparing the surroundings of Thai military bases used by the U.S. army to districts close to unused Thai bases, we find that there are currently 5 times more commercial sex workers in districts near former U.S. bases. The development of the sex industry is also explained by a high price elasticity of supply due to female migration from regions affected by an agricultural crisis. Finally, we study a consequence induced by the large numbers of sex workers in few red-light districts: the HIV outbreak in the early 1990s. |
| Keywords: | sex industry, industry location, persistence, HIV/AIDS |
| JEL: | O17 O18 N15 J46 J47 I28 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10686&r=his |
| By: | Rubolino, Enrico (Uppsala University); Waldenström, Daniel (Paris School of Economics) |
| Abstract: | We compile data spanning the period 1900–2014 and up to 30 countries to study long-run patterns in the tax elasticity of top incomes. Our results show that top tax elasticities vary tremendously over time; they were medium-to-low before 1950, virtually zero during the postwar era up to 1980 and have thereafter increased to unprecedented levels. We document a strong income gradient in tax response within the top, underlining the importance to study even small top groups separately. Several mechanisms are investigated. Tax-driven income shifting between wage and capital income is important in the very top. Wars, financial crises, and country-specific effects and trends have bearing on top elasticities whereas standard macroeconomic factors and indicators of "real responses" do not. |
| Keywords: | taxation, income inequality, economic history |
| JEL: | D31 H21 H24 H26 N40 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10667&r=his |
| By: | Oeindrila Dube; S.P. Harish |
| Abstract: | Are states led by women less prone to conflict than states led by men? We answer this question by examining the effect of female rule on war among European polities over the 15th-20th centuries. We utilize gender of the first born and presence of a female sibling among previous monarchs as instruments for queenly rule. We find that polities led by queens were more likely to engage in war than polities led by kings. Moreover, the tendency of queens to engage as aggressors varied by marital status. Among unmarried monarchs, queens were more likely to be attacked than kings. Among married monarchs, queens were more likely to participate as attackers than kings, and, more likely to fight alongside allies. These results are consistent with an account in which marriages strengthened queenly reigns because married queens were more likely to secure alliances and enlist their spouses to help them rule. Married kings, in contrast, were less inclined to utilize a similar division of labor. These asymmetries, which reflected prevailing gender norms, ultimately enabled queens to pursue more aggressive war policies. |
| JEL: | D74 F51 H56 J16 N43 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23337&r=his |
| By: | Stephen Broadberry; John Joseph Wallis |
| Abstract: | Using annual data from the thirteenth century to the present, we show that improved long run economic performance has occurred primarily through a decline in the rate and frequency of shrinking, rather than through an increase in the rate of growing. Indeed, as economic performance has improved over time, the short run rate of growing has typically declined rather than increased. Most analysis of the process of economic development has hitherto focused on increasing the rate of growing. Here, we focus on understanding the forces making for a reduction in the rate of shrinking, drawing a distinction between proximate and ultimate factors. The main proximate factors considered are (1) structural change (2) technological change (3) demographic change and (4) the changing incidence of warfare. We conclude with a consideration of institutional change as the key ultimate factor behind the reduction in shrinking. |
| JEL: | N0 N10 O0 O4 O43 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23343&r=his |
| By: | Òscar Jordà; Björn Richter; Moritz Schularick; Alan M. Taylor |
| Abstract: | Higher capital ratios are unlikely to prevent a financial crisis. This is empirically true both for the entire history of advanced economies between 1870 and 2013 and for the post-WW2 period, and holds both within and between countries. We reach this startling conclusion using newly collected data on the liability side of banks’ balance sheets in 17 countries. A solvency indicator, the capital ratio has no value as a crisis predictor; but we find that liquidity indicators such as the loan-to-deposit ratio and the share of non-deposit funding do signal financial fragility, although they add little predictive power relative to that of credit growth on the asset side of the balance sheet. However, higher capital buffers have social benefits in terms of macro-stability: recoveries from financial crisis recessions are much quicker with higher bank capital. |
| JEL: | E44 G01 G21 N20 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23287&r=his |
| By: | Mickey Fitzgerald |
| Abstract: | This paper examines J.H. Todd & Sons Ltd., a British Columbia family-owned and run fish packing company during the years 1881 through 1954. The research presented in this paper outlines the contribution of individual Todd members to both the success and eventual demise of the company. Also examined is the history of the B. C. salmon canning industry, the evolution of J.H. Todd & Sons Ltd., the role of the company in the broader context of the B. C. fishing industry; and the factors that led to the demise of the company. The research relies on documentary primary sources as well as extensive oral history collection obtained from Todd family members and employees. |
| Keywords: | salmon canning; British Columbia fish packers; history of BC fishing industry |
| JEL: | N52 N92 Q22 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:rep:wpaper:2017-01&r=his |
| By: | Dimitriou, Georgia; Metaxas, Theodore |
| Abstract: | The economic crisis that burst in 2007 was one of the harshest-if not the harshest- in the recent history. Companies, households and whole economies were affected. Starting from the USA and later expanding to the western countries, the consequences of the crisis were severe for some countries even within the European Union. Iceland is one of first the countries in Europe that experienced the crisis and its consequences. On October 2008, the country saw the financial system collapsing. Iceland experienced an economic bubble which can be related and compared to the one that took place in the USA. The great difference, though, was that the enormity of the Icelandic crisis could not be compared to its small size. In a short period of time, Icelanders, as well as British and Dutch, lost their money. No signs were taken seriously in the previous years, leading to a complete disaster of the economy. The purpose of this article is to examine the factors that caused the 2007 crisis and why Iceland was so badly affected. Were there any signs of the forthcoming disaster? Could it all have been prevented and, if so, in what price? These are the questions that we would like to answer in order to understand this crisis and prevent a future one. |
| Keywords: | Economic crisis, Baniking Sector, Iceland, IMF |
| JEL: | G01 N24 O16 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78758&r=his |
| By: | Spaenjers , Christophe |
| Abstract: | I study the returns to investments in durable assets since the start of the twentieth century. These assets are generally characterized by relatively low capital gains and substantial price fluctuations. The rate of value appreciation has been more pronounced for collectibles, but transaction costs are very high in such markets as well. However, a rental income yield can add substantially to the returns on housing and land, and likewise owners of collectibles may receive a significant emotional dividend. Because of the lack of such an income or utility stream, gold, silver, and diamonds appear to have been particularly bad long-term investments (at least if not held in the form of jewelry). Finally, durable assets are unlikely to be good inflation hedges, but they may still help diversifying a portfolio because of the imperfect correlations with financial assets. |
| Keywords: | returns; housing; land; art; collectibles; gold; silver; diamonds |
| JEL: | G01 N20 |
| Date: | 2016–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1143&r=his |
| By: | Gambetti, Luca (Autonomous University of Barcelona); Messina, Julián (Inter-American Development Bank) |
| Abstract: | Examines the evolution of the cyclicality of real wages and employment in four Latin American economies: Brazil, Chile, Colombia and Mexico, during the period 1980-2010. Wages are highly pro-cyclical during the 1980s and early 1990s, a period characterized by high inflation. As inflation declined wages became less pro-cyclical, a feature that is consistent with emerging downward wage rigidities in a low inflation environment. Compositional effects associated with changes in labor participation along the business cycle appear to matter less for estimates of wage cyclicality than in developed economies. |
| Keywords: | downward wage rigidity, indexation, real wage cyclicality, vector autoregression, time varying coefficients, Bayesian estimation |
| JEL: | E24 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10657&r=his |
| By: | Pakrashi, Debayan (Asian Development Bank Institute); Frijters, Paul (Asian Development Bank Institute) |
| Abstract: | Economic growth in the East Asian economies was remarkable during the latter part of the 20th century, starting with Japan just after World War II, followed by the East Asian Tigers and “tiger cubs” and, most recently, the People’s Republic of China and India. The high, sustained economic growth of these economies during their boom period reduced the disparity between the West and these countries (in terms of standards of living). The source of such extraordinary growth has been a matter of great interest since then, but no attempt has been made so far to model the political economy of takeoffs and landings in the context of economic growth. We empirically define takeoffs and landings, and provide an overlapping generation model with technological change and skill formation to explain the relatively stable growth rates in the Asian economies for decades. The existence of a technology trap, meaning economies cannot afford available advanced technology, may explain why takeoffs are relatively rare, even when many underdeveloped economies are still waiting for their own growth miracle. |
| Keywords: | takeoff; landings; technology trap; economic growth; economic miracle; overlapping generation model; technological change; skill formation |
| JEL: | O31 O43 O57 |
| Date: | 2017–01–19 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0641&r=his |
| By: | Chan, Jia Hao |
| Abstract: | This is a book review for François Gipouloux's The Asian Mediterranean: port cities and trading networks in China, Japan and South Asia, 13th-21st century. |
| Keywords: | Book review |
| JEL: | Y3 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78703&r=his |
| By: | Colvin, Christopher L. |
| Abstract: | This article investigates the impact of the socioreligious segregation of Dutch society on the asset allocation choices of rural bankers and the withdrawal behavior of their depositors during the early 1920s. Results suggest that cooperatively-owned Raiffeisen banks for both Catholic and Protestant minority groups could limit their exposure to a debt-deflation crisis, despite operating more precarious balance sheets than banks for majorities. Business histories demonstrate how strict membership criteria and personal guarantors acted as screening and monitoring devices. Banks serving minorities functioned as club goods, managing their exposure to the crisis by exploiting the confessionalized nature of Dutch society. |
| Keywords: | cooperative banking,club goods,financial history,the Netherlands |
| JEL: | G01 G21 N24 N84 P13 Z12 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:qucehw:201703&r=his |
| By: | Lakdawala, Aeimit; Wu, Shu |
| Abstract: | In this paper we show how the degree of central bank credibility influences the level, slope and curvature of the term structure of interest rates. In an estimated structural model, we find that historical yield curve data are best matched by the Federal Reserve conducting policy in a loose commitment framework, rather than the commonly used discretion and full commitment assumptions. The structural impulse responses indicate that the past history of realized shocks play a crucial role in determining the dynamic effects of monetary policy on the yield curve. Finally, the regime-switching framework allows us to estimate likely re-optimization episodes which are found to impact the middle of the yield curve more than the short and long end. |
| Keywords: | Term Structure, Commitment, Regime-Switching Bayesian Estimation, Optimal Monetary Policy, DSGE models |
| JEL: | E52 G12 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78253&r=his |
| By: | William Gatt (Central Bank of Malta) |
| Abstract: | This paper estimates a Phillips curve for Malta using data since the 1960s and presents evidence that the relationship has flattened over time, implying that the link between inflation and economic activity has weakened. Further analysis finds that this phenomenon was driven by downward price stickiness, whereby the responsiveness of price inflation is limited during economic slowdowns; however the Phillips curve was and remains alive during economic booms. |
| JEL: | C11 C32 E31 E32 O11 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:mlt:wpaper:0216&r=his |
| By: | Nicolas Pinsard (CEPN - Centre d'Economie de l'Université Paris Nord - Université Paris 13 - USPC - Université Sorbonne Paris Cité - CNRS - Centre National de la Recherche Scientifique); Yamina Tadjeddine (BETA - Bureau d'Economie Théorique et Appliquée - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Abstract : The edict of Paulette (1604) is an important legal act, which produced many institutional changes. Offices appeared in the XIIIth century in France, thus earlier than the edict. However, by giving property rights and inalienable handover to officeholders, in return of paying a tax that is valued at 1/60th of the office value, the edict had an important impact on office nature. Through data and documents that we picked up at Archives nationales and in the Sully collection, our article dwells on the consequences of financialization of offices, that is to say economic modifications (in terms of public finances), social and political transformations (by the emergence of a new social class). |
| Abstract: | L'édit de Paulette de 1604 est un acte juridique important dont nous proposons ici d'analyser les conséquences institutionnelles. Cet édit ne crée pas les offices qui existaient depuis le XIIIe siècle, mais il modifie leur nature en conférant des droits de propriété et de transmission inaliénables à l'officier dès lors qu'un impôt (1/60ème de la valeur de l'office) est payé annuellement. À partir des archives du fonds de Sully complétées par des données publiées, notre article met en exergue les modifications économiques (en termes de finances publiques), les transformations socio-politiques (avec l'apparition d'une nouvelle classe sociale) induites par cette financiarisation des offices. |
| Keywords: | Offices,Finances Publiques,Financiarisation,Histoire financière,France,Ancien Régime |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cepnwp:hal-01512176&r=his |
| By: | Matthew Gentzkow; Bryan T. Kelly; Matt Taddy |
| Abstract: | An ever increasing share of human interaction, communication, and culture is recorded as digital text. We provide an introduction to the use of text as an input to economic research. We discuss the features that make text different from other forms of data, offer a practical overview of relevant statistical methods, and survey a variety of applications. |
| JEL: | C1 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23276&r=his |
| By: | Tadashi Ito (Faculty of International Social Science, Gakushuin University); Toshiyuki Matsuura (Keio Economic Observatory, Keio University) |
| Abstract: | Welfare gain through international trade is a cornerstone of international economics literature. However, it is only recently that the data and the methodologies become available to empirically assess such welfare gain. Building on the recently developed methodologies of estimating elasticity of substitution and computing welfare gains from trade, we estimate welfare gains of Japan from its trade liberalization in manufacturing sector. To do this as precisely as possible, the elasticities of substitution for HS 9-digit product code are estimated for various periods of time. The analyses show that Japan's welfare gains from trade liberalization took place especially from the 1990s, and reached eleven percent vis-a-vis the autarky situation. |
| Keywords: | Trade Liberalization, Welfare gains, Japan |
| JEL: | F14 |
| Date: | 2017–01–14 |
| URL: | http://d.repec.org/n?u=RePEc:keo:dpaper:2017-002&r=his |
| By: | Debin Ma; Jared Rubin |
| Abstract: | Tax extraction in Qing China was low relative to Western Europe. It is not obvious why: China was much more absolutist and had stronger rights over property and people. Why did the Chinese not convert their absolute power into revenue? We propose a model, supported by historical evidence, which suggests that i) the center could not ask its tax collecting agents to levy high taxes because it would incentivize agents to overtax the peasantry; ii) the center could not pay agents high wages in return for high taxes because the center had no mechanism to commit to refrain from confiscating the agent’s resources in times of crisis. A solution to this problem was to offer agents a low wage and ask for low taxes while allowing agents to take extra, unmonitored taxes from the peasantry. This solution only worked because of China’s weak administrative capacity due its size and poor monitoring technology. This analysis suggests that low investment in administrative capacity can be an optimal solution for an absolutist ruler since it substitutes for a credible commitment to refrain from confiscation. Our study carries implications for state capacity beyond Imperial China. |
| Keywords: | administrative capacity; fiscal capacity; state capacity; principal-agent problem; monitoring; credible commitment; absolutism; limited government; taxation; China; Europe; Qing Empire |
| JEL: | O53 N0 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:wpaper:75218&r=his |
| By: | Shahbaz, Muhammad; Mallick, Hrushikesh; Kumar, Mantu; Hammoudeh, Shawkat |
| Abstract: | This study attempts to explore the relationship between globalization and financial development by endogenising economic growth, population density, inflation and institutional quality for India during the period from 1971-2013. Using the more conclusive Bayer-Hanck (2013) combined cointegration method, the study provides evidence of cointegration among these variables. The long run and short run estimates from the ARDL model and causality tests respectively suggest that globalization in its all forms (political, social and economic) and its overall measure as well as inflation are detrimental to financial development, while economic growth and population density both promote financial development. Further, the results also point out that institutional quality is not conducive to financial development in India, and there exists a feedback effect between financial development and inflation. Moreover, financial development is influenced by economic growth, institutional quality and population density. |
| Keywords: | Globalization, financial development, institutional quality, inflation, India |
| JEL: | C0 |
| Date: | 2017–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78805&r=his |