nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2019‒01‒14
twenty-six papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. Economic History and Contemporary Challenges to Globalization By Kevin Hjortshøj O'Rourke
  2. The institutionalization of Economic History in England, c.1900 By Alexandre Macchione Saes
  3. The Monetary and Fiscal History of Brazil, 1960-2016 By Joao Ayres; Marcio Garcia; Diogo A. Guillén; Patrick J. Kehoe
  4. Computations of French Lifetables by Département By Florian Bonnet
  5. The Institutional Foundations of Religious Politics: Evidence from Indonesia By Samuel Bazzi; Gabriel Koehler-Derrick; Benjamin Marx
  6. The Race Between Demand and Supply: Tinbergen's Pioneering Studies of Earnings Inequality By James J. Heckman
  7. The introduction of serfdom and labor markets By Jensen, Peter Sandholt; Radu, Cristina Victoria; Severgnini, Battista; Sharp, Paul
  8. Growing, Shrinking and Long Run Economic Performance: Historical Perspectives on Economic Development By Broadberry, Stephen; Wallis, John
  9. Structural Transformation in Egypt, Morocco and Tunisia: Patterns, Drivers and Constraints By Rim Mouelhi; Monia Ghazali
  10. Political Determinants of Government Structure and Economic Performance in Turkey since 1950 By Ali Akarca
  11. Wars, Local Political Institutions, and Fiscal Capacity: Evidence from Six Centuries of German History By Becker, Sascha O.; Ferrara, Andreas; Melander, Eric; Pascali, Luigi
  12. Bibliometric analysis on the evolution of knowledge structure of consumer behavior analysis in Telecommunications Policy By Oh, Jeesun; Kim, Jeeeun
  13. Returning to returns: revisiting the British education evidence By Dolton, Peter; Sandi, Matteo
  14. Model selection for modeling the demand for narrow money in transitional economies By Błażejowski, Marcin; Kufel, Paweł; Kufel, Tadeusz; Kwiatkowski, Jacek; Osińska, Magdalena
  15. The politics of violence and populism in post-colonial democracy: The role of political society in South Africa By Koelble, Thomas A.
  16. Cash and the Economy: Evidence from India's Demonetization By Gabriel Chodorow-Reich; Gita Gopinath; Prachi Mishra; Abhinav Narayanan
  17. Capital, Non-Capital and Transformative Politics in Contemporary India By Deepankar Basu
  18. Japan and the Great Divergence, 730-1874 By Bassino, Jean-Pascal; Broadberry, Stephen; Fukao, Kyoji; Gupta, Bishnupriya; Takashima, Masanori
  19. Sustainability and Wellbeing: A Text Analysis of New Zealand Parliamentary Debates, Official Yearbooks and Ministerial Documents By Mubashir Qasim
  20. Impulses and Propagation Mechanisms in Equilibrium Business Cycles Theories: From Interwar Debates to DSGE "Consensus" By Muriel Dal-Pont Legrand; Harald Hagemann
  21. French Civil Society : Historical Background, Present position and Major issues By Edith Archambault
  22. Oil Revenues Shocks and Inequality in Iran By Mohammad Reza Farzanegan; Tim Krieger
  23. An evaluation of early warning models for systemic banking crises: Does machine learning improve predictions? By Beutel, Johannes; List, Sophia; von Schweinitz, Gregor
  24. The fracturing of globalization: Implications of economic resentments and geopolitical contradictions By Thomas Palley
  25. Bank capital, lending booms, and busts. Evidence from Spain in the last 150 years By Mikel Bedayo; Ángel Estrada; Jesús Saurina
  26. From Commodity to Fiat and Now to Crypto: What Does History Tell Us? By Barry Eichengreen

  1. By: Kevin Hjortshøj O'Rourke
    Abstract: The paper surveys three economic history literatures that can speak to contemporary challenges to globalization: the literature on the anti-globalization backlash of the nineteenth century, focused largely on trade and migration; the literature on the Great Depression, focused largely on capital flows, the gold standard, and protectionism; and the literature on trade and warfare.
    JEL: F02 N70
    Date: 2018–12
  2. By: Alexandre Macchione Saes
    Abstract: The paper presents the Economic History Society development, the world's first economic history association, taking into account the intellectual environment that was immersed the founding leaders and the debates between economic historians and economists in England. The economic history institutionalization in England, through the formation of its association, the organization of congresses and publications oriented to the community, should be seen not only as an indicator of the vitality of the area of the society of researchers, but also as an instrument of protection and appreciation of the area
    Keywords: Economic History Society; England; economic history
    JEL: N01 B52
    Date: 2018–12–20
  3. By: Joao Ayres; Marcio Garcia; Diogo A. Guillén; Patrick J. Kehoe
    Abstract: Brazil has had a long period of high inflation. It peaked around 100 percent per year in 1964, decreased until the first oil shock (1973), but accelerated again afterward, reaching levels above 100 percent on average between 1980 and 1994. This last period coincided with severe balance of payments problems and economic stagnation that followed the external debt crisis in the early 1980s. We show that the high-inflation period (1960–1994) was characterized by a combination of fiscal deficits, passive monetary policy, and constraints on debt financing. The transition to the low-inflation period (1995–2016) was characterized by improvements in all of these features, but it did not lead to significant improvements in economic growth. In addition, we document a strong positive correlation between inflation rates and seigniorage revenues, although inflation rates are relatively high for modest levels of seigniorage revenues. Finally, we discuss the role of the weak institutional framework surrounding the fiscal and monetary authorities and the role of monetary passiveness and inflation indexation in accounting for the unique features of inflation dynamics in Brazil.
    JEL: E0 E02 E3 E4 E42 E5 E58 E6
    Date: 2019–01
  4. By: Florian Bonnet (UP1 UFR02 - Université Panthéon-Sorbonne - UFR d'Économie - UP1 - Université Panthéon-Sorbonne, PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Debates concerning the territorial divide in France are deep. To bring a contribution to this issue, I compute the departmental lifetables since 1901, for both men and women. In this paper, I present the raw data collected to do so, namely yearly births and deaths by age as well as population by age at each census carried out during the 20th century. I add statistics according to military mortality and mortality in deportation to cover the periods of the Two World Wars. I also present the methods I use to compute these lifetables, which come mainly from the Human Mortality Database protocol. I revise this protocol to take into account the specificities of French departmental data, mainly the few changes in French departmental boundaries, the underestimation of infant mortality and the lack of raw data homogeneity. This new database complements a still limited supply of long-term mortality statistics computed at local level.
    Date: 2018–12
  5. By: Samuel Bazzi (Boston University (Boston, Massachusetts) (BU)); Gabriel Koehler-Derrick (Harvard University); Benjamin Marx
    Abstract: Why do religious politics thrive in some societies but not others? This paper explores the institutional foundations of this process in Indonesia, the world’s largest Muslim democracy. We show that a major Islamic institution, the waqf, fostered the entrenchment of political Islam at a critical historical juncture. In the early 1960s, rural elites transferred large amounts of land into waqf—a type of inalienable charitable trust—to avoid expropriation by the government as part of a major land reform effort. Although the land reform was later undone, the waqf properties remained. We show that greater intensity of the planned reform led to more prevalent waqf land and Islamic institutions endowed as such, including religious schools, which are strongholds of the Islamist movement. We identify lasting effects of the reform on electoral support for Islamist parties, preferences for religious candidates, and the adoption of Islamic legal regulations (sharia). Overall, the land reform contributed to the resilience and eventual rise of political Islam by helping to spread religious institutions, thereby solidifying the alliance between local elites and Islamist groups. These findings shed new light on how religious institutions may shape politics in modern democracies.
    JEL: D72 D74 P16 P26 Z12
    Date: 2018–10
  6. By: James J. Heckman (The University of Chicago)
    Abstract: Understanding inequality and devising policies to alleviate it was a central focus of Jan Tinbergen's lifetime research. He was far ahead of his time in many aspects of his work. This essay places his work in the perspective of research on inequality in his time and now, focusing on his studies on the pricing of skills and the evolution of skill prices. In his most fundamental contribution, Tinbergen developed the modern framework for hedonic models as part of his agenda for integrating demand and supply for skills to study determination of earnings and its distribution and the design of effective policy. His lifetime emphasis on social planning caused some economists to ignore his fundamental work.
    Keywords: income inequality, hedonic models, general equilibrium, models of inequality
    JEL: B31 D31 D33 D63 I24 J20 P21
    Date: 2018–12
  7. By: Jensen, Peter Sandholt (University of Southern Denmark); Radu, Cristina Victoria (University of Southern Denmark); Severgnini, Battista (Copenhagen Business School); Sharp, Paul (University of Southern Denmark, CAGE, CEPR)
    Abstract: We provide evidence of how restrictions on labor mobility, such as serfdom and other types of labor coercion, impact labor market outcomes. To do so, we estimate the impact of a large negative shock to labor mobility in the form of the reintroduction of serfdom in Denmark in 1733, which was targeted at limiting the mobility of farmhands. Using a unique data source based on the archives of estates from the eighteenth century, we test whether serfdom affected the wages of farmhands more strongly than other groups in the labor market, and results based on a differences-in-differences approach reveal evidence consistent with a strong negative effect following its introduction. We also investigate whether one mechanism was that boys with rural backgrounds were prevented from taking up apprenticeships in towns, and find suggestive evidence that this was indeed the case. Thus, our results suggest that serfdom was effectively reducing mobility.
    Keywords: Serfdom, labor mobility, coercion JEL Classification: J3, N33, P4
    Date: 2018
  8. By: Broadberry, Stephen; Wallis, John
    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 and (3) demographic change. We conclude with a consideration of institutional change as the key ultimate factor behind the reduction in shrinking.
    Date: 2018–12
  9. By: Rim Mouelhi (University of Manouba); Monia Ghazali
    Abstract: This paper conducts an analysis of the structural transformation in three MENA countries, Tunisia, Morocco and Egypt over a long time span (1960-2010). We examine labor productivity evolution and structural change (SC) contribution to productivity growth over different sub-periods. We analyze the contribution of the different economic sectors to the aggregate SC in the three countries. An econometric analysis is also performed to identify the main factors underlying the intensity and the pattern of structural change. Results suggest that the three countries initiated and achieved some progress in the structural transformation over the 1970’s, 1980’s and early 1990’s. However, this process has stagnated at low levels of income and has remained unfinished. Deindustrialization occurred at an early stage of development in the three countries, in contrast to what has been noticed in developed and emergent countries.
    Date: 2018–10–10
  10. By: Ali Akarca (University of Illinois)
    Abstract: During the last two-thirds of a century, Turkey was ruled by a wide variety of governments: single-party governments, coalitions partnered by two or more parties and by ideologically compatible and incompatible parties, minority and military governments. While single party governments all lasted at least two terms, the rest rarely lasted even one term. The timing of these governments and the order in which they followed each other were not by chance but according to a pattern induced by coups. Typically single party governments were ended by coups. Ideologically incompatible and then compatible coalition governments followed, usually after a brief military administration. Then once again single party governments returned. As economic growth typically exhibits an inverted-U type of pattern over the life of a government, and declines as the number of ruling parties and the ideological distance between them increase, the coups lowered the growth rate of the country and generated political business cycles that are distinct from those induced by elections. In the paper, these assertions are explained in detail, and supported using theory, history, descriptive statistics, and regression analysis. It is also shown that improving democratic institutions of the country would enhance the stability and growth of the economy greatly.
    Date: 2018–10–23
  11. By: Becker, Sascha O. (University of Warwick and CAGE); Ferrara, Andreas (University of Warwick and CAGE); Melander, Eric (University of Warwick and CAGE); Pascali, Luigi (UPF and CAGE)
    Abstract: We study the effect of warfare on the development of state capacity and representative institutions using novel data on cities and territories in the German lands between 1200 and 1750. More specifically, we show that cities with a higher conflict exposure establish more sophisticated tax systems, but also develop larger councils, councils that are more likely to be elected by citizens, and more likely to be independent of other local institutions. These results are consistent with the idea of a trade-off between more efficient taxation and power sharing proposed in earlier work. We make headway on establishing a causal role of wars by using changes to German nobles’ positions within the European nobility network to instrument for conflict.
    Keywords: N13; P48; R11 Jel Classification: WARFARE; POLITICAL INSTITUTIONS; STATE CAPACITY
    Date: 2018
  12. By: Oh, Jeesun; Kim, Jeeeun
    Abstract: This paper aim to conduct a bibliometric analysis on the evolution of knowledge structure of empirical analysis of consumer behaviour in Telecommunications Policy. The related studies on the Telecommunications Policy, the academic journal specialized in communication industry and service research, have been conducted relatively recently to review the last 40 years. No research has been conducted on a specific topic including consumer behaviour in the journal. The research results are as follows. First, empirical analysis on consumer behavior has been growing quantitatively, but the article concentration on the 10 sample countries has also strengthened in the journal for the last 10 years. Second, there were differences in research themes and methods by periods and countries. Third, the number of citations in the empirical analysis was relatively higher than that of the all articles, but the citations were commonly concentrated in the top 10 countries. Finally, in the "Telecommunications Policy," the citation rate of empirical analysis paper is high. The "Telecommunications Policy" is cited the most because "Telecommunications Policy" has a long history and the journal covering multidisciplinary and international subject in the economy and society related ICT.
    Keywords: Bibliometric analysis,Knowledge structure,Empirical analysis,consumer behavior
    Date: 2018
  13. By: Dolton, Peter; Sandi, Matteo
    Abstract: We revisit the question of what is the rate of return to education in Great Britain. We make two contributions. Firstly, we re-assess the robustness of Harmon and Walker (1995), Oreopoulos (2006) and Devereux and Hart (2010) to equation specification and estimation method. Secondly, we generalize the previous IV approaches by using the month of birth in the calculation of a more accurate IV exploiting the 1947, 1963 and 1972 UK School Leaving Age reforms. Our results highlight the importance of equation specification and they provide a robust case for a 6% Rate of Return to Education for men
    JEL: N0 R14 J01
    Date: 2017–07–05
  14. By: Błażejowski, Marcin; Kufel, Paweł; Kufel, Tadeusz; Kwiatkowski, Jacek; Osińska, Magdalena
    Abstract: The aim of this study was to verify the stability of monetary systems. Systems were measured by aggregate narrow money in selected emerging economies. The United Kingdom's economy was used as a benchmark. The Baumol-Tobin and Friedman monetary models were used as the theoretical basis for the for empirical error-correction models. A Bayesian averaging of classical estimates (BACE) approach was used to incorporate model uncertainty and select the best model. The results show that the monetary systems in 6 of the 11 economies were stable in the long run and that a set of factors changed in the short run. The robustness of the model selection based on the BACE procedure was strongly confirmed.
    Keywords: model uncertainty, BACE, jointness, robust variables selection, gretl
    JEL: C52 E41 P24
    Date: 2018–12–11
  15. By: Koelble, Thomas A.
    Abstract: This paper argues that current levels of violence and populism in post-colonial spaces such as South Africa are a consequence of a socio-history of violent dispossession, exploitation and impoverishment and is perpetuated by the continuation of the socio-economic and political conditions rooted in that history of exceptional violence, inequality and injustice. A switch in the political system does not reduce violence by itself. The disposition towards violence can only be shifted by a fundamental shift away from the economics and politics of the apartheid era. Since such a shift is unlikely to occur under current conditions, the perpetuation of violence and populist politics are likely to remain key features and consti-tutive elements of post-apartheid democracy.
    Date: 2018
  16. By: Gabriel Chodorow-Reich; Gita Gopinath; Prachi Mishra; Abhinav Narayanan
    Abstract: We analyze a unique episode in the history of monetary economics, the 2016 Indian “demonetization.” This policy made 86% of cash in circulation illegal tender overnight, with new notes gradually introduced over the next several months. We present a model of demonetization where agents hold cash both to satisfy a cash-in-advance constraint and for tax evasion purposes. We test the predictions of the model in the cross-section of Indian districts using several novel data sets including: a data set containing the geographic distribution of demonetized and new notes for causal inference; nightlights data and employment surveys to measure economic activity including in the informal sector; debit/credit cards and e-wallet transactions data; and banking data on deposit and credit growth. Districts experiencing more severe demonetization had relative reductions in economic activity, faster adoption of alternative payment technologies, and lower bank credit growth. The cross-sectional responses cumulate to a contraction in employment and nightlights-based output due to demonetization of 2 p.p. and of bank credit of 2 p.p. in 2016Q4 relative to their counterfactual paths, effects which dissipate over the next few months. We use our model to show these cumulated effects are a lower bound for the aggregate effects of demonetization. We conclude that unlike in the cashless limit of new-Keynesian models, in modern India cash serves an essential role in facilitating economic activity.
    JEL: E5 O23
    Date: 2018–12
  17. By: Deepankar Basu (Department of Economics, University of Massachusetts - Amherst)
    Abstract: Kalyal Sanayal’s work on postcolonial capitalism has been influential in many strands of critical social theory. In this brief note, I investigate three key components of his argument and find them wanting. In particular, I show that the evolution of land ownership in India does not support the claim that the primitive accumulation of capital is one of the important processes in operation in contemporary India. On the contrary, the evidence suggests that the process of primitive accumulation has been arrested or significantly slowed down. In addition to the critical comments on Sanyal (2007), I indicate towards an alternative framework that is better able to explain the key features of contemporary India.
    Keywords: postcolonial capitalism
    JEL: B24 O29
    Date: 2019
  18. By: Bassino, Jean-Pascal; Broadberry, Stephen; Fukao, Kyoji; Gupta, Bishnupriya; Takashima, Masanori
    Abstract: Despite being the first Asian economy to achieve modern economic growth, Japan has received relatively little attention in the Great Divergence debate. New estimates suggest that although the level of GDP per capita remained below the level of northwest Europe throughout the period 730-1874, Japan experienced positive trend growth before 1868, in contrast to the negative trend growth experienced in China and India, leading to a Little Divergence within Asia. However, growth in Japan remained slower than in northwest Europe so that Japan continued to fall behind until after the institutional reforms of the early Meiji period. The Great Divergence thus occurred as the most dynamic part of Asia fell behind the most dynamic part of Europe.
    Keywords: GDP per capita, Britain, Great Divergence, Japan
    JEL: N10 N30 N35 O10 O57
    Date: 2018–12
  19. By: Mubashir Qasim (University of Waikato)
    Abstract: Recent advances in natural language processing and semantic analysis methods are enabling scholars to analyse text extensively. These techniques have not only minimized the margins of error arising from missing data from a traditionally conducted discourse analysis but also permitted reproducibility of research results. In this paper, we use several text analysis methods to analyse the evolution of the terms ‘sustainability’ and ‘wellbeing’ (SaW) from parliamentary debates (Hansard), New Zealand Official Yearbooks (NZOYBs) and ministerial documents over 125 years. The term ‘welfare’ has existed in the NZOYBs and Hansard text since the start of our analysis (1893), with a steadily increasing trend until the mid-1980s. The term ‘wellbeing’ gained momentum in mid-1930s and has been linked strongly with ‘sustainability’ in the following decades. Our analysis re-emphasizes the importance of the Brundtland Report (‘Our Common Future’) which acted as a catalyst to the sustainable movement in late 1980s. ‘Sustainability’ and ‘wellbeing’ then began to appear in conjunction. Our analysis includes the finding that SaW differ significantly when political parties are considered.
    Keywords: sustainable development; wellbeing; text analysis; resilience; parliamentary debates; Hansard
    JEL: C80 I31 N00 Q01 Q56
    Date: 2019–01–10
  20. By: Muriel Dal-Pont Legrand (Université Côte d'Azur, France; GREDEG CNRS); Harald Hagemann (University of Hohenheim, Stuttgart)
    Abstract: There is no doubt that DSGE (Dynamic Stochastic General Equilibrium) models which were considered benchmark models during the Great Moderation period, were challenged enormously when the global financial crisis developed. As business cycles models, their capacity to provide insights into the origins and mechanisms of propagation failed in the context of the crisis. This questions their validity also as a basis for economic policy advice. As a consequence, many economists are pleading for new benchmarks or for a deep reconsideration of both the theoretical and empirical sides of the arguments. Although no new consensus has yet emerged on possible "solutions" to or reorientations of the research program in this field, many economists are trying to understand where modern macroeconomics went wrong. As historians of economic thought, we propose to retrace the evolution of business cycles theory and of its empirical practices in order to better understand the way this literature today addresses macroeconomic volatility and eventually crises.
    Date: 2019–01
  21. By: Edith Archambault (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Date: 2018
  22. By: Mohammad Reza Farzanegan (Philipps-University Marburg); Tim Krieger
    Abstract: We study the responses of income inequality to positive per capita oil and gas revenues shocks in Iran. Using historical data from 1973 to 2016 and vector autoregression (VAR) -based impulse response functions, we find a positive and statistically significant response of income inequality to oil booms. Our analysis can help policymakers evaluate and accommodate the possible positive or negative effects on inequality in Iran resulting from the 2016 lifting of the embargo against the country.
    Date: 2018–09–18
  23. By: Beutel, Johannes; List, Sophia; von Schweinitz, Gregor
    Abstract: This paper compares the out-of-sample predictive performance of different early warning models for systemic banking crises using a sample of advanced economies covering the past 45 years. We compare a benchmark logit approach to several machine learning approaches recently proposed in the literature. We find that while machine learning methods often attain a very high in-sample fit, they are outperformed by the logit approach in recursive out-of-sample evaluations. This result is robust to the choice of performance measure, crisis definition, preference parameter, and sample length, as well as to using different sets of variables and data transformations. Thus, our paper suggests that further enhancements to machine learning early warning models are needed before they are able to offer a substantial value-added for predicting systemic banking crises. Conventional logit models appear to use the available information already fairly efficiently, and would for instance have been able to predict the 2007/2008 financial crisis out-of-sample for many countries. In line with economic intuition, these models identify credit expansions, asset price booms and external imbalances as key predictors of systemic banking crises.
    Keywords: early warning system,logit,machine learning,systemic banking crises
    JEL: C35 C53 G01
    Date: 2018
  24. By: Thomas Palley
    Abstract: The last forty years have witnessed a third wave of globalization which can be termed “neoliberal globalization”. Now, there are indications that the era of neoliberal globalization might be drawing to a close, as evidenced by the trade war between the US and China. This paper argues that the fracturing of neoliberal globalization reflects the growing impact of economic resentments and geopolitical contradictions. The paper presents a simple analytical framework that constructs the global economy in terms of a core consisting of the US, China, and the EU. It then examines how globalization creates economic resentments and geopolitical tensions within and between members of the core, thereby fracturing globalization. The rise of US – China geopolitical competition promises to twist the character of the global economic order, which stands to be shaped by strategically motivated economic integrations and recalibrations rather than generalized global economic integration. The paper then extends the analysis to non-core country blocs and examines how they are impacted by globalization and the rise of US – China geopolitical competition.
    Keywords: Neoliberal globalization, economic resentments, geopolitical contradictions.
    JEL: F02 F50 F59
    Date: 2019–01
  25. By: Mikel Bedayo (Banco de España); Ángel Estrada (Banco de España); Jesús Saurina (Banco de España)
    Abstract: In this paper we analyze the effect of bank capital on lending expansion and contraction for nearly 150 years in Spain. We fi rst build up thoroughly a measure of bank leverage (i.e. the capital to assets ratio) for the Spanish banking sector starting in year 1880. Then, we run a proper econometric test to analyze the impact that bank capital levels have on lending cycles, controlling for other determinants of credit growth. We do fi nd robust empirical evidence of an asymmetric relationship between bank capital and credit cycle. In particular, an increase in the bank capital before expansions reduces credit growth while it increases credit growth when the recession arrives. Conversely, a too depleted level of bank capital when entering in a recession has a severe impact on lending (i.e. may bring about a deep credit crunch) with quite negative and lasting effects in the economy and the wellbeing of the society as a whole. The paper is particularly useful to support macroprudential policies (dynamic provisions and the countercyclical capital buffer) that have been very recently put in place as they will help to smooth the credit cycle. The experience of Spain over more than a century, with very marked lending cycles, provides a fertile ground for analyzing and supporting them, not only based on the last lending cycle, but also on those occurred in the more distant past.
    Keywords: lending cycles, bank crisis, capital ratio, leverage ratio, macroprudential tools.
    JEL: G01 G21 N23 N24
    Date: 2018–12
  26. By: Barry Eichengreen
    Abstract: Over time, there has been a tendency for political jurisdictions and residents to converge on a single currency. Monopoly over seigniorage is a source of political power and a valuable lifeline when sovereignty is threatened. Moreover a uniform currency, insofar as it is free of counterparty and liquidity risk, facilitates economic activity. But will digital currencies now reverse this trend toward uniformity, given the apparent ease with which they can be created? The information sensitivity of those units, evident in the fact that they trade at varying prices, suggests that they do not yet provide the core functions of money. So-called stable coins are intended to bridge this gap, but whether they can be successfully scaled up and maintain their stability is doubtful. The one unit that can clearly meet these challenges is central bank digital currency. But there would be both costs and benefits of moving in this direction.
    JEL: E4 E40 F0 N0
    Date: 2019–01

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