nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2019‒02‒25
35 papers chosen by

  1. Always Egalitarian? Australian Earnings Inequality c1870 By Panza, Laura; Williamson, Jeffrey G
  2. Where is the Middle Class? Inequality, Gender and the Shape of the Upper Tail from 60 million English Death and Probate Records, 1892-2016 By Cummins, Neil
  3. Housing Rent Dynamics and Rent Regulation in St. Petersburg (1880-1917) By Konstantin A. Kholodilin; Leonid E. Limonov; Sofie R. Waltl
  4. Public Debt Through the Ages By Eichengreen, Barry; El-Ganainy, Asmaa; Esteves, Rui; Mitchener, Kris James
  5. Tax Revenues and the Fiscal Cost of Trade Liberalization, 1792-2006 By Julia Cage; Lucie Gadenne
  6. The growth pattern of British children, 1850-1975 By Gao, Pei; Schneider, Eric B.
  7. Weather shocks and agricultural commercialization in colonial tropical Africa: did cash crops alleviate social distress? By Papaioannou, Kostadis J.; de Haas, Michiel
  8. Housing Rent Dynamics and Rent Regulation in St. Petersburg (1880-1917) By Limonov, Leonid E.; Kholodilin, Konstantin A.; Waltl, Sofie R.
  9. Financial Revolution in Republican China during 1900-1937: a Survey and a New Interpretation By Ma, Debin
  10. The Monetary and Fiscal History of Bolivia, 1960–2017 By Timothy J. Kehoe; Carlos Gustavo Machicado; José Peres-Cajías
  11. A Silver Transformation: Chinese Monetary Integration in Times of Political Disintegration during 1898-1933 By Ma, Debin; Zhao, Liuyan
  12. Public goods institutions, human capital, and growth: evidence from German history By Dittmar, Jeremiah E.; Meisenzahl, Ralf R.
  13. The Trials of the Trilemma: International Finance 1870-2017 By Eichengreen, Barry; Esteves, Rui
  14. The missing ingredient: Distance. Internal migration and its long-term economic impact in the United States By Rodríguez-Pose, Andrés; von Berlepsch, Viola
  15. Farewell life, farewell love : analysis of survival inequalities among soldiers who died for France during WW I By Antoine Parent; Olivier, Bureau D'economie Théorique Guillot
  16. Does Scientific Progress Affect Culture? A Digital Text Analysis By Michela Giorcelli; Nicola Lacetera; Astrid Marinoni
  17. Pandemics, Places, and Populations: Evidence from the Black Death By Jedwab, Remi; Johnson, Noel; Koyama, Mark
  18. Social entrepreneurship before neoliberalism?: The life and work of Akhtar Hameed Khan By Lewis, David
  19. Determinantes de la productividad multifactorial: los casos de las principales economías latinoamericanas y emergentes de Asia (1960 - 2015) By Gómez, Wilman Arturo; Posada, Carlos Esteban; Rhenals, Remberto
  20. Instituciones en el país de las maravillas By René Alonso Guerra Molina
  21. Debates and dissident inside the FOMC during WW2 By Etienne Farvaque; Antoine Parent; Piotr, Cracow University) Stanek
  22. A different perspective on the evolution of UK income inequality By Atkinson, Anthony B.; Jenkins, Stephen P.
  23. Education and Conflict: Evidence from a Policy Experiment in Indonesia By Rohner, Dominic; Saia, Alessandro
  24. Les voies de la recherche cliométrique ouvertes par le Capital au XXIè siècle By Antoine Parent
  25. Tax administration and compliance: evidence from medieval Paris By Slivinski, Al; Sussman, Nathan
  26. Migrants, Ancestors, and Foreign Investments By Konrad Burchardi; Thomas Chaney; Tarek A. Hassan
  27. Sovereign Bonds since Waterloo By Meyer, Josefin; Reinhart, Carmen M.; Trebesch, Christoph
  28. Family characteristics and macroeconomic factors in U. S. intragenerational family income mobility, 1978–2014 By Bradbury, Katharine L.
  29. Martínez de Hoz: ¿neoliberal o desarrollista? La clase dominante argentina frente al programa económico implementado durante la última dictadura argentina, 1976-1981 By Gonzalo Sebastián Sanz Cerbino; Héctor Eduardo Sartelli
  30. Evolution of financial information and management control over the last 150 years. The case of Bodegas Torres By Oriol Amat; Natàlia Amat
  31. The Long-Term Economic Effects of Polio: Evidence from the Introduction of the Polio Vaccine to Sweden in 1957 By Serratos-Sotelo, Luis; Bengtsson, Tommy; Nilsson, Anton
  32. A missing touch of Adam Smith in Amartya Sen’s account of Public Reasoning: the Man Within for the Man Without By Laurie Bréban; Muriel Gilardone
  33. The Euro Crisis in the Mirror of the EMS By Corsetti, Giancarlo; Eichengreen, Barry; Hale, Galina B; Tallmann, Eric
  34. The Slope of the Term Structure and Recessions: Evidence from the UK, 1822-2016 By Capie, Forrest; Goodhart, Charles A; Mills, Terence C
  35. Furthering regional energy security instead of national approaches By Thauan Santos

  1. By: Panza, Laura; Williamson, Jeffrey G
    Abstract: Trends in Australian inequality across the twentieth century are now well documented and they closely replicate trends in every other advanced economy: from WW1 to the 1970s, inequality fell steeply everywhere, and from the 1970s to the present, it rose just as steeply. Despite following a similar trajectory, Australia remained more egalitarian throughout. Why has it been exceptional and what are its origins? Previous work has found no evidence documenting any rise in Australian income and earnings inequality from 1820 to 1870. But what was the level of inequality around 1870? Was it more or less egalitarian than other New World countries and Europe then? Using an array of primary and secondary sources we construct social tables for Victoria and New South Wales (about 75 percent of Australia's 1870 GDP) to estimate the Australian earnings distribution. We find that Australia was far more equal than in the United States, the United Kingdom and the rest of Europe during the same period. We speculate on the causes and whether the same estimates can be constructed for 1901 or 1911, thus documenting earnings distribution trends during Australia's poor growth decades of the late nineteenth and early twentieth century.
    Date: 2019–02
  2. By: Cummins, Neil
    Abstract: This paper analyses a newly constructed individual level dataset of every English death and probate from 1892-2016. The estimated top wealth shares match closely existing estimates. However, this analysis clearly shows that the 20th century's `Great Equalization' of wealth stalled in mid-century. The probate rate, which captures the proportion of English with any significant wealth at death rose from 10% in the 1890s to 40% by 1950 and has stagnated to 2016. Despite the large declines in the wealth share of the top 1%, from 73% to 20%, the median English person died with almost nothing throughout. All changes in inequality after 1950 involve a reshuffling of wealth within the top 30%. Further, I find that a log-linear distribution fits the empirical data better than a Pareto power law. Finally, I show that the top wealth shares are increasingly and systematically male as one ascends in wealth, 1892-1992, but this has equalized over the 20th century.
    Keywords: Big Data; economic history; inequality
    JEL: D31 N00 N33 N34
    Date: 2019–01
  3. By: Konstantin A. Kholodilin (DIW Berlin and Leontief Centre); Leonid E. Limonov (National Research University - Higher School of Economics and Leontief Centre); Sofie R. Waltl (Luxembourg Institute of Socio-Economic Research and Vienna University of Economics and Business - Department of Economics)
    Abstract: This article studies the evolution of housing rents in St. Petersburg between 1880 and 1917 covering an eventful period of Russian and world history. We collect and digitize over 5,000 rental advertisements from historic newspapers, which we use together with geo-coded addresses and detailed structural characteristics to construct a quality-adjusted rent price index in continuous time. We provide the first pre-war and pre-Soviet index based on market data for any Russian housing market. In 1915, one of the world’s earliest rent control and tenant protection policies was introduced as a response to soaring prices following the outbreak of World War I. We analyze the impact of this policy: while before the regulation rents were increasing at a similar rapid pace as other consumer prices, the policy reversed this trend. We find evidence for official compliance with the policy, document a rise in tenure duration and strongly increased rent affordability among workers after the introduction of the policy. We conclude that the immediate prelude to the October Revolution was indeed characterized by economic turmoil, but rent affordability and rising rents were no longer the prevailing problems.
    Keywords: Rental Market, Rent Regulation, Intra-Urban Rent Dynamics, Hedonic Rent Price Index, Economic History, Pre-Soviet Russia, October Revolution
    JEL: C14 C43 N93 O18
    Date: 2019–02
  4. By: Eichengreen, Barry; El-Ganainy, Asmaa; Esteves, Rui; Mitchener, Kris James
    Abstract: We consider public debt from a long-term historical perspective, showing how the purposes for which governments borrow have evolved. Periods when debt-to-GDP ratios rose explosively as a result of wars, depressions and financial crises also have a long history. Many of these episodes resulted in debt-management problems resolved through debasements and restructurings. Less widely appreciated are successful debt consolidation episodes, instances in which governments inheriting heavy debts ran primary surpluses for long periods in order to reduce those burdens to sustainable levels. We analyze the economic and political circumstances that made these successful debt consolidation episodes possible.
    Keywords: Debt History; Sovereign debt; Sovereign Debt Composition; Sovereign debt crises
    JEL: F3 H6 N1
    Date: 2019–01
  5. By: Julia Cage (Département d'économie); Lucie Gadenne (University of Warwick)
    Abstract: This article examines the impact of trade liberalization on government revenues. Using a new dataset on tax revenues for 130 countries between 1792 and 2006, we identify ninety-nine episodes of trade liberalization defined as a large fall in trade tax revenues not accompanied by a decrease in trade. Seven took place before World War One, seven in the interwar period, eighteen in the Bretton Woods period and the remainder after 1970. We examine the extent to which countries were able to recover the tax revenues lost by liberalizing trade by using other sources of revenue. We find that historical (pre-1970) trade liberalization episodes were unlikely to be accompanied by decreases in tax revenues, especially during the Bretton Woods era. In the recent period however, over 40% of the developing countries in our sample experience a fall in total tax revenues that lasts more than ten years after an episode of trade liberalization. Overall, trade liberalization led to larger and longer-lived declines in tax revenues in developing countries since 1970 than in today’s rich countries in the 19th and 20th centuries. Results are similar when we consider government expenditures, suggesting decreases in trade tax revenues negatively affect governments’ capacity to provide public services in many developing countries.
    Date: 2018–10
  6. By: Gao, Pei; Schneider, Eric B.
    Abstract: This paper is the first to use individual-level, longitudinal measures of child growth to document changes in the growth pattern in Britain between the 1850s and 1970s. Based on a unique dataset gathered from the records of the training ship Indefatigable, we analyse the mean heights of boys at admission and their longitudinal growth using regressions that control for observable characteristics. We find a secular increase in boys’ mean height over time, and the height gain was most rapid during the interwar period. In addition, longitudinal growth velocity was low and similar at different ages for boys born before the 1910s, suggesting that there was no marked pubertal growth spurt like that which occurs in modern populations. However, for boys born in the 1910s and later, higher growth velocities associated with pubertal growth appeared for boys in a narrow range of ages, 14 to 16. Thus, it appears that there was a substantial change in the growth pattern beginning in the 1910s with the emergence of a strong pubertal growth spurt. The timing of this shift implies that declines in child morbidity and improved hygiene mattered more for the changing growth pattern than improvements in nutrition that occurred before the 1910s.
    Keywords: child growth; health transition; ES/L010267/2
    JEL: N33 N35 J13 O15
    Date: 2019–01
  7. By: Papaioannou, Kostadis J.; de Haas, Michiel
    Abstract: A rapidly growing body of research examines the ways in which climatic variability influence economic and societal outcomes. This study investigates how weather shocks triggered social distress in British colonial Africa. Further, it intervenes in a long-standing and unsettled debate concerning the effects of agricultural commercialization on the abilities of rural communities to cope with exogenous shocks. We collect qualitative evidence from annual administrative records to explore the mechanisms linking weather extremes to harvest failures and social distress. We also conduct econometric testing on a novel panel dataset of 143 administrative districts across west, south-central and east Africa in the Interwar Era (1920-1939). Our findings are twofold. First, we find robust evidence that rainfall anomalies (both drought and excessive precipitation) are associated with spikes in imprisonment (our proxy for social distress). We argue that the key causal pathway is the loss of agricultural income, which results in higher imprisonment for theft, unrest, debt and tax default. Second, we find that the impact of weather shocks on distress is partially mitigated by the cultivation of export crops. Our findings suggest that, even in the British colonial context, smallholder export crop cultivation led to higher private incomes as well as greater public investment. Our findings speak to a topic of considerable urgency today as the process of global climate change accelerates, generating more severe and unpredictable climatic extremes. An increased understanding and identification of adaptive and mitigating factors, would assist in targeting policy interventions and designing adaptive institutions to support vulnerable rural societies.
    Keywords: Africa; rural livelihoods; economic history; colonialism; social distress; tropical agriculture; agricultural commercialization; environmental history
    JEL: D74 F54 N17 N57 Q17
    Date: 2017–06–01
  8. By: Limonov, Leonid E.; Kholodilin, Konstantin A.; Waltl, Sofie R.
    Abstract: This article studies the evolution of housing rents in St. Petersburg between 1880 and 1917 covering an eventful period of Russian and world history. We collect and digitize over 5,000 rental advertisements from historic newspapers, which we use together with geo-coded addresses and detailed structural characteristics to construct a quality-adjusted rent price index in continuous time. We provide the first pre-war and pre-Soviet index based on market data for any Russian housing market. In 1915, one of the world's earliest rent control and tenant protection policies was introduced as a response to soaring prices following the outbreak of World War I. We analyze the impact of this policy: while before the regulation rents were increasing at a similar rapid pace as other consumer prices, the policy reversed this trend. We find evidence for official compliance with the policy, document a rise in tenure duration and strongly increased rent affordability among workers after the introduction of the policy. We conclude that the immediate prelude to the October Revolution was indeed characterized by economic turmoil, but rent affordability and rising rents were no longer the prevailing problems.
    Keywords: Rental Market, Rent Regulation, Intra-Urban Rent Dynamics, Hedonic Rent Price Index, Economic History, Pre-Soviet Russia, October Revolution
    Date: 2019–02
  9. By: Ma, Debin
    Abstract: This paper surveys the phenomenal transformation of banking and finance, public debt and monetary regimes during 1900-1937, a period of great political instability in Chinese history. To understand why growth in these strategic sectors occurred, I highlight the role of the institutional nexus of Western treaty ports (with Shanghai being the most important) and China Maritime Customs service, a relatively autonomous tax bureaucracy. My new interpretation on the importance of this mechanism sheds new light on the role of Chinese political institutions, the impact of the West and the ongoing Great Divergence debate.
    Date: 2019–02
  10. By: Timothy J. Kehoe; Carlos Gustavo Machicado; José Peres-Cajías
    Abstract: After the economic reforms that followed the National Revolution of the 1950s, Bolivia seemed positioned for sustained growth. Indeed, it achieved unprecedented growth from 1960 to 1977. The rapid accumulation of debt due to persistent deficits and a fixed exchange rate policy during the 1970s led to a debt crisis that began in 1977. From 1977 to 1986, Bolivia lost almost all the gains in GDP per capita that it had achieved since 1960. In 1986, Bolivia started to grow again, interrupted only by the financial crisis of 1998–2002, which was the result of a drop in the availability of external financing. Bolivia has grown since 2002, but government policies since 2006 are reminiscent of the policies of the 1970s that led to the debt crisis, in particular, the accumulation of external debt and the drop in international reserves due to a de facto fixed exchange rate since 2012.
    JEL: E52 E63 H63 N16
    Date: 2019–02
  11. By: Ma, Debin; Zhao, Liuyan
    Abstract: This paper provides the first systematic econometric study on the evolution of Chinese silver exchange and monetary regimes during 1898-1933. Using high quality data sets of monthly and daily prices of silver dollars, we apply the threshold autoregressive models to estimate the silver points between Shanghai and other seventeen cities in Northern and Central China. We find a dramatic improvement in monetary integration from the 1910s, consolidated throughout the 1920s and 1930s to rival the global standard. We supplement our analysis with new data sets on volumes and costs of silver flows and with an in-depth historical narrative. Our paper revaluates the efficiency of the silver regime and China's economic performance in the Republican era.
    Date: 2019–02
  12. By: Dittmar, Jeremiah E.; Meisenzahl, Ralf R.
    Abstract: What are the origins and consequences of the state as a provider of public goods? We study public goods provision established through new laws in German cities during the 1500s. Cities that adopted the laws subsequently began to differentially produce and attract human capital and to grow faster. Legal change occurred where ideological competition introduced by the Protestant Reformation interacted with local politics. We study plagues that shifted local politics in a narrow period as sources of exogenous variation in public goods institutions, and find support for a causal interpretation of the relationship between legal change, human capital, and growth.
    Keywords: institutions; political economy; public goods; education; human capital; growth; state capacity
    JEL: I2 N13 O11 O4
    Date: 2020–01–01
  13. By: Eichengreen, Barry; Esteves, Rui
    Abstract: In this paper we survey the history of international finance spanning a century and a half. We start by characterizing capital flows in the long run, organizing our discussion around six facts relating to the volume and volatility of capital flows, measured in both net and gross terms. We then connect up the discussion with exchange rates and monetary policies. The organizing framework for this section is the macroeconomic trilemma. We describe where countries situated themselves relative to the trilemma over time and consider the political economy of their choices. Finally, we study the connections between international finance and economic and financial stability. We present consistent measures of growth and debt crises over the century and a half covered in this paper and discuss how their incidence is related to those institutional and political circumstances and, more generally, to the nature of the international monetary and financial regime.
    Keywords: Capital Flows; financial crises; Monetary Systems
    JEL: F21 F33 F34 N10
    Date: 2019–01
  14. By: Rodríguez-Pose, Andrés; von Berlepsch, Viola
    Abstract: This paper examines if internal migrants at the turn of the 20th century have influenced the long-term economic development of the counties where they settled over 100 years ago. Using Census microdata from 1880 and 1910, the distance travelled by American-born migrants between birthplace and county of residence is examined to assess its relevance for the economic development of US counties today. The settlement patterns of domestic migrants across the 48 continental states are then linked to current county-level development. Factors influencing both migration at the time and the level of development of the county today are controlled for. The results of the analysis underline the economic importance of internal migration. Counties that attracted American-born migrants more than 100 years ago are significantly richer today. Moreover, distance is crucial for the impact of internal migration on long-term economic development; the larger the distance travelled by domestic migrants, the greater the long-term economic impact on the receiving territories.
    Keywords: Counties; distance; economic development; internal migration; long-term; US
    JEL: J61 N11 O15 R23
    Date: 2019–01
  15. By: Antoine Parent (Observatoire français des conjonctures économiques); Olivier, Bureau D'economie Théorique Guillot (Bureau d'Economie Théorique et Appliquée (CNRS/Université de Strasbourd/UL/INRA/AgroParistech) (BETA))
    Abstract: This article provides precise and detailed insight into the mortality of French soldiers during the First World War, focusing on their survival time during the conflict. The article clearly contributes to the longpursued yet unfinished endeavour that is a thorough and definitive demographic assessment of this war. To provide a general framework for the article’s conclusions, it bears recalling certain multinational data on the losses incurred during what has often and rightly been referred to as the “hecatomb” or “the great bloodletting”. According to an overall average estimate, the Great War caused the deaths of nearly 10 million soldiers, including more than 2 million Germans, nearly 2 million Russians, just under 1.5 million Frenchmen, 800,000 Britons, and 650,000 Italians, although these figures remain subject to debate. Counts include men from the most fertile age groups, between ages 19 and 40, that also made up the largest share of their countries’ labour forces. They form the “sacrificed generations”. As a proportion of its total population and among Allied countries, France suffered the greatest number of military deaths after Serbia, slightly fewer than the Ottoman Empire in relation to the Central Powers. Deaths as tallied above correspond to troops killed in action. If we include soldiers who were wounded, taken prisoner, and who went missing, it becomes apparent that the Central Powers were the more grievously impacted side, with Serbia maintaining its tragic frontrunner status among the Allies. About 500,000 soldiers died after 1918 from wounds received or diseases contracted during the war
    Keywords: Population; Soldiers; Mortality; WW1
    Date: 2018–11
  16. By: Michela Giorcelli; Nicola Lacetera; Astrid Marinoni
    Abstract: We study the interplay between scientific progress and culture through text analysis on a corpus of about eight million books, with the use of techniques and algorithms from machine learning. We focus on a specific scientific breakthrough, the theory of evolution through natural selection by Charles Darwin, and examine the diffusion of certain key concepts that characterized this theory in the broader cultural discourse and social imaginary. We find that some concepts in Darwin’s theory, such as Evolution, Survival, Natural Selection and Competition diffused in the cultural discourse immediately after the publication of On the Origins of Species. Other concepts such as Selection and Adaptation were already present in the cultural dialogue. Moreover, we document semantic changes for most of these concepts over time. Our findings thus show a complex relation between two key factors of long-term economic growth – science and culture. Considering the evolution of these two factors jointly can offer new insights to the study of the determinants of economic development, and machine learning is a promising tool to explore these relationships.
    Keywords: science, culture, economic history, text analysis, machine learning
    JEL: C19 C89 N00 O00 O39 Z19
    Date: 2019
  17. By: Jedwab, Remi; Johnson, Noel; Koyama, Mark
    Abstract: The Black Death killed 40% of Europe's population between 1347-1352, making it one of the largest shocks in history. Despite its importance, little is known about its spatial effects and the effects of pandemics more generally. Using a novel dataset that provides information on spatial variation in Plague mortality at the city level, as well as various identification strategies, we explore the short-run and long-run impacts of the Black Death on city growth. On average, cities recovered their pre-Plague populations within two centuries. In addition, aggregate convergence masked heterogeneity in urban recovery. We show that both of these facts are consistent with a Malthusian model in which population returns to high-mortality locations endowed with more rural and urban fixed factors of production. Land suitability and natural and historical trade networks played a vital role in urban recovery. Our study highlights the role played by pandemics in determining both the sizes and placements of populations.
    Keywords: Black Death; cities; growth; Malthusian Theory. Migration; path dependence; Urbanization
    JEL: J11 N00 N13 O11 O47 R11 R12
    Date: 2019–02
  18. By: Lewis, David
    Abstract: The life history method can be used to historicise the study of social and public policy. Reviewing the life and work of Pakistani social entrepreneur A.H. Khan provides a useful reminder that what Jyoti Sharma recently termed ‘the neoliberal takeover of social entrepreneurship’ is a relatively recent phenomenon. While Khan’s achievements across the public and non-governmental (NGO) sectors continue to be debated amongst scholars and activists in South Asia, his life and work – which is not well known in the Global North as it perhaps should be – highlights a much broader and more inclusive way of thinking about the social entrepreneur as an organiser of change
    Keywords: social entrepreneurship; non-governmental organisations (NGOs); community development; public administration; rural development; life history
    JEL: N0
    Date: 2019–01–01
  19. By: Gómez, Wilman Arturo; Posada, Carlos Esteban; Rhenals, Remberto
    Abstract: Resumen: El objetivo de este trabajo fue explicar el mayor o menor ritmo de crecimiento de la productividad total de los factores (PTF) en las principales economías del este asiático y latinoamericanas entre 1960 y 2015. Encontramos evidencia econométrica favorable a una hipótesis: el aumento del gasto público de consumo, dada la evolución de otros factores, tiene un efecto negativo sobre la PTF. Otros resultados del ejercicio econométrico, aquellos relativos a hipotéticos efectos positivos de la inversión pública y de las importaciones sobre la PTF, no fueron, unos, tan robustos, ni, otros, tan confiables como hubiésemos esperado. Abstract : The objective of this paper was to explain the greater or lesser growth rate of total factor productivity, TFP, in the main East Asian and Latin American economies between 1960 and 2015. We found econometric evidence favorable to this hypothesis: the increase in public consumption expenditures, given the evolution of other factors, reduces the TFP. Other results of the econometric exercise, those that are related to hypothetical positive effects of public investment and imports on TFP were not as robust or as reliable as we would have expected.
    Keywords: crecimiento del PIB per cápita, productividad total de los factores, capital físico, capital humano, consumo público, inversión pública, importaciones, cointegración panel
    JEL: C33 E22 E24 F43
    Date: 2018–12–03
  20. By: René Alonso Guerra Molina
    Abstract: Resumen En este artículo se realiza un abordaje teórico de las instituciones desde la óptica de diversos autores, haciendo énfasis en la hipótesis de Acemoglu y Robinson sobre las instituciones extractivas que de una u otra manera determinaron el éxito o fracaso de algunos países, así como sus condiciones económicas, sociales y políticas en la actualidad. Para esto, se toma como ejemplo de estudio, el caso de Colombia a través de su legado colonial, posterior independencia y presente, para comprender como sus instituciones la convirtieron en “el país de las maravillas”.
    Date: 2018–12–28
  21. By: Etienne Farvaque (Economie Quantitative, Intégration, Politiques Publiques et Econométrie); Antoine Parent (Observatoire français des conjonctures économiques); Piotr, Cracow University) Stanek (Cracow University)
    Abstract: We demonstrate that even though during WWII the interest rate was close to zero supporting the financing of the military effort, dissent inside the FOMC occurred with a similar frequency to other policy episodes. Our analysis highlights that the debates which resulted in dissents turned around two broad issues: the size of the Fed’s balance sheet as well as the functioning of and communication with financial markets. Thus, we argue that the conventional view depicting the Fed as merely accommodating treasury needs should be revised. Our detailed investigation of dissents emphasises the modernity of the objections raised by Fed officials.
    Keywords: Central Banking; Federal open market committee; Governance; Public debt; WW2
    JEL: D71 D78 E58 N12 N42
    Date: 2018–12
  22. By: Atkinson, Anthony B.; Jenkins, Stephen P.
    Abstract: This paper scrutinizes the conventional wisdom about trends in UK income inequality and also places contemporary inequality in a much longer historical perspective. We combine household survey and income tax data to provide better coverage of all income ranges from the bottom to the very top. We make a case for studying distributions of income between tax units (i.e. not assuming the full income sharing that goes with the use of the household as the unit of analysis) for reasons of principle as well as data harmonization. We present evidence that income inequality in the UK is as least as high today as it was just before the start of World War 2
    Keywords: inequality; tax unit; household; Gini coefficient; income tax data; household survey data; HBA1; SPI
    JEL: C46 C81 D31
    Date: 2019–01–01
  23. By: Rohner, Dominic; Saia, Alessandro
    Abstract: This paper studies the impact of school construction on the likelihood of conflict, drawing on a policy experiment in Indonesia, and collecting our own novel dataset on political violence for 289 districts in Indonesia over the period 1955-1994. We find that education has a strong, robust and quantitatively sizeable conflict-reducing impact. It is shown that the channels of transmission are both related to economic factors as well as to an increase in inter-religious trust and tolerance. Interestingly, while societal mechanisms are found to have an immediate impact, economic channels only gain importance after some years. We also show that school construction results in a shift away from violent means of expression (armed conflict) towards non-violent ones (peaceful protests).
    Keywords: Civil War; conflict; education; Fighting; Polarization; protest; Returns to education; Schools
    JEL: C23 D74 H52 I20 N45
    Date: 2019–02
  24. By: Antoine Parent (Observatoire français des conjonctures économiques)
    Abstract: Thomas Piketty dans Le Capital au XXIe siècle établit un premier principe de divergence fondamentale entre la rémunération du capital et du travail qui serait la source des inégalités dans l'Histoire. En même temps, l'accumulation du capital est le facteur qui historiquement a tiré la croissance. L'auteur aborde successivement ces deux aspects mais n'étudie pas les liens qui unissent ces deux propositions : les inégalités sont-elles un moteur ou un frein de la croissance dans l'Histoire ? Tel est le fil conducteur de notre analyse de l'ouvrage qui prend appui sur deux interrogations majeures : comment passer de l'énoncé d'une « loi historique » à un modèle de croissance dynamique ? L'épargne peut-elle être un frein à la croissance ? Nous suggérons dans une dernière partie que le recours à la cliométrie peut être un moyen d'éclairer sinon de trancher ces débats.
    Keywords: Capitalisme; Modèles de croissance économique; Inégalités; Loi historique
    Date: 2018–12
  25. By: Slivinski, Al; Sussman, Nathan
    Abstract: We analyze the Parisian taille of the late 13th century - a taxation mechanism used to finance periodic major expenditures by the French Crown, including wars. Our major finding is that this system was remarkably successful along a number of dimensions, in an environment without the administrative structures used by contemporary governments. The taille's essential features were; an agreement between the king and city government to collect a fixed amount of revenue, and a collection process that made use of information about taxpayers held by their fellow artisans and/or neighbors. We show that it collected considerable sums without social unrest, with high levels of compliance, and administrative costs that were low even by modern standards. We also argue that its success may have lessons for improved tax collection and compliance in contemporary less-developed economies.
    Keywords: compliance; evasion; Fairness; institutions; middle ages; Paris; taxation
    JEL: H2 H21 H26 N13 N43
    Date: 2019–02
  26. By: Konrad Burchardi (Institute for International Economic Studies (IIES)); Thomas Chaney (Département d'économie); Tarek A. Hassan (Boston University)
    Abstract: We use 130 years of data on historical migrations to the U.S. to show a causal effect of the ancestry composition of U.S. counties on foreign direct investment (FDI) sent and received by local firms. To isolate the causal effect of ancestry on FDI, we build a simple reduced-form model of migrations: Migrations from a foreign country to a U.S. county at a given time depend on (1) a push factor, causing emigration from that foreign country to the entire U.S., and (2) a pull factor, causing immigration from all origins into that U.S. county. The interaction between time-series variation in origin-specific push factors and destination-specific pull factors generates quasi-random variation in the allocation of migrants across U.S. counties. We find that doubling the number of residents with ancestry from a given foreign country relative to the mean increases the probability that at least one local firm engages in FDI with that country by 4 percentage points. We present evidence that this effect is primarily driven by a reduction in information frictions, and not by better contract enforcement, taste similarities, or a convergence in factor endowments.
    Keywords: Migrations; Foreign direct investment; International trade; Networks; Social ties
    JEL: O11 J61 L14
    Date: 2018–08
  27. By: Meyer, Josefin; Reinhart, Carmen M.; Trebesch, Christoph
    Abstract: This paper studies external sovereign bonds as an asset class. We compile a new database of 220,000 monthly prices of foreign-currency government bonds traded in London and New York between 1815 (the Battle of Waterloo) and 2016, covering 91 countries. Our main insight is that, as in equity markets, the returns on external sovereign bonds have been sufficiently high to compensate for risk. Real ex-post returns averaged 7% annually across two centuries, including default episodes, major wars, and global crises. This represents an excess return of around 4% above US or UK government bonds, which is comparable to stocks and outperforms corporate bonds. The observed returns are hard to reconcile with canonical theoretical models and with the degree of credit risk in this market, as measured by historical default and recovery rates. Based on our archive of more than 300 sovereign debt restructurings since 1815, we show that full repudiation is rare; the median haircut is below 50%.
    Keywords: coupons; default; interest rates; investor returns; portfolio; recovery; risk premiums; Sovereign debt; yields
    JEL: E4 F3 F4 G1 N0
    Date: 2019–02
  28. By: Bradbury, Katharine L. (Federal Reserve Bank of Boston)
    Abstract: Family economic mobility has been a policy concern for decades, with interest heating up further since the 1990s. Using data that tracks individual families’ incomes during overlapping 10-year periods from 1978 through 2014, this paper investigates the relationships of factors — family characteristics and macro influences — to intragenerational mobility and whether the importance of those factors has changed over time. Family characteristics include both levels of work behavior and family structure and within-period changes in those factors, as well as time-invariant characteristics of the family head, such as race. Macro factors include indicators of GDP growth and inflation during each 10-year period. The positions families occupy in the income distribution and the degree to which they are stuck or able to move up (or slide down) over time are critical determinants of their current well-being and their children’s prospects.
    Keywords: intragenerational mobility; economic inequality; family income distribution; macroeconomic influences; family structure
    JEL: D31 E24 I32 J62
    Date: 2018–10–01
  29. By: Gonzalo Sebastián Sanz Cerbino; Héctor Eduardo Sartelli
    Abstract: Resumen A 40 años de su paso por el Ministerio de Economía, durante la última dictadura militar argentina, la gestión de Martínez de Hoz sigue despertando polémicas. ¿Encabezó un programa de reformas neoliberales o más allá de su prédica, mantuvo las barreras proteccionistas de una economía cerrada en beneficio de una burguesía industrial orientada al mercado interno? En este artículo nos proponemos volver sobre un tópico transitado de la historiografía económica con una hipótesis original: Martínez de Hoz llevó adelante un plan coherente con los intereses de la gran burguesía industrial que acumulaba en la Argentina, que no podía ser liberal (como la burguesía agropecuaria), pero tampoco “populista” (como los industriales de menor tamaño). Para corroborar nuestra hipótesis analizaremos las propuestas económicas de estas fracciones de la burguesía y su relación con la política implementada por Martínez de Hoz.
    Date: 2018–12–28
  30. By: Oriol Amat; Natàlia Amat
    Abstract: This article describes the most relevant milestones in the development of both financial information and management control, from the inception of the business up to the present day but particularly over the last 150 years. As a case study, it sets out the development of the wine producing company Bodegas Torres, a family group with its headquarters in Vilafranca del Penedés (Barcelona). It is a company renowned for its innovation and excellence in the world of wine producing, but also in management, including its financial information and management control practices.
    Keywords: Financial information, management control, winemaking, Miguel Torres.
    JEL: M41 M42
    Date: 2019–02
  31. By: Serratos-Sotelo, Luis (Lund University); Bengtsson, Tommy (Lund University); Nilsson, Anton (Lund University)
    Abstract: This study explores the impact an exogenous improvement in childhood health has on later-life outcomes. Using extensive and detailed register data from the Swedish Interdisciplinary Panel, we follow individuals exposed to the introduction of the first vaccine against polio in Sweden (birth cohorts 1937-1966) until adulthood in order to quantify the causal effect of polio vaccination on long-term economic outcomes. The results show that, contrary to what has been found in the literature for other health-related interventions, including other vaccines, exposure to the vaccine against polio did not seem to have any long-term effects on the studied adult economic outcomes. Upon closer inspection of how the disease affects children, this might be explained by the fact that no scarring effects from exposure to high incidence of polio were found on adult income, educational achievement, or hospitalizations, which seems to suggest that those who contracted the illness but suffered only the milder symptoms of the disease made a full recovery and had no lifelong sequels as a consequence of the condition. The absence of scarring effects is hypothesized to be related to the pathology and epidemiology of the disease itself, which infects many, but scars only those who suffer the most recognizable paralytic symptoms.
    Keywords: vaccine, polio, income, education, early-life, Sweden
    JEL: I18
    Date: 2019–01
  32. By: Laurie Bréban (PHARE, Université Paris 1 Panthéon Sorbonne, France); Muriel Gilardone (Condorcet Center for Political Economy, Normandie Univ, UNICAEN, CNRS, CREM, F-14000 Caen, France)
    Abstract: Sen claims that his 2009 theory of justice is based in part upon Smith’s idea of the “impartial spectator”. His claim has received criticism: some authors have responded that his interpretation of Smith’s concept is unfaithful to the original (e.g., Ege, Igersheim and Le Chapelain 2012); others, focusing on internal features of Sen’s analysis, critique his use of the Smithian impartial spectator, arguing that it is a weak point in his comparative theory of justice (e.g., Shapiro 2011). In this paper we address both sets of criticisms. While agreeing with commentators that Sen’s reading of Smith is somewhat unfaithful, we reiterate that his aim in The Idea of Justice is not to provide an exegesis of Smith but rather to build his own comparative theory of justice by “extending Adam Smith’s idea of the impartial spectator” (IJ: 134) to his own project. After clarifying their distinct approaches to the concept of the impartial spectator, we draw upon our account of these differences to evaluate Sen’s own use of the concept. Despite significant divergences, we show that Sen’s version of the impartial spectator is not inconsistent with Smith’s analysis. Though it does not correspond to Smith’s concept, i.e. to what the Scottish philosopher sometimes calls the “man within”, it is reminiscent of another figure from Smith’s moral philosophy: the “man without”. Beyond this analogy, there are further connections between Smith’s imaginary figure of the “man within” and Sen’s account of “common beliefs”—both notions are ways of representing our beliefs regarding what is moral or just. But whereas Smith’s moral philosophy offers an analysis of the process by which the “man without” influences the “man within”, nothing of that kind is to be found in Sen’s conception of public reasoning. And it is here that Smith’s famous concept of “sympathy” can supplement Sen’s theory, in a way which furnishes an answer to Shapiro’s (2011) criticism regarding the possibility of the spontaneous change of beliefs toward greater impartiality.
    Keywords: Sen, Smith, Impartial Spectator, Man Without, Public Reasoning, Man Within, Sympathy, Deliberation, Justice, Agreement, Non-Prudential Morality
    JEL: A13 B12 B31 B41 B54 D63 D71
    Date: 2019–02
  33. By: Corsetti, Giancarlo; Eichengreen, Barry; Hale, Galina B; Tallmann, Eric
    Abstract: Why was recovery from the euro area crisis delayed for a decade? The explanation lies in the absence of credible and timely policies to backstop financial intermediaries and sovereign debt markets. In this paper we add light and color to this analysis, contrasting recent experience with the 1992-3 crisis in the European Monetary System, when national central banks and treasuries more successfully provided this backstop. In the more recent episode, the incomplete development of the euro area constrained the ability of the ECB and other European institutions to do likewise.
    Keywords: Backstop; Currency devaluation; financial crises; Sovereign and banking risk
    JEL: E63 G01 N14
    Date: 2019–02
  34. By: Capie, Forrest; Goodhart, Charles A; Mills, Terence C
    Abstract: This paper investigates whether the inversion of the yield spread, with short-term rates higher than the long-term rate, has been and remains an effective predictor of recessions in the U.K. using monthly data from 1822 to 2016. Indicators of recession are constructed in a variety of ways depending on the availability and properties of the data in the pre-World War 1, inter-war, and post-World War 2 periods. It is found that, using peak-to-trough recession indicators and a probit regression model, there is reasonably strong evidence to support the inverted yield spread being a predictor of recessions for lead times up to eighteen months in all three periods.
    Keywords: prediction; probit models; Recession; yield spread
    JEL: E30 E32 E43 E44 N10
    Date: 2019–02
  35. By: Thauan Santos
    Abstract: Abstract This paper argues that furthering energy security should move beyond a national approach and consequently consider a regional one. The case study considers Mercosur and UNASUR, covering the period between 2015-2050. The methodology is based on energy modeling and scenarization using the Open Source Energy Modelling System – South America Model Base (OSeMOSYS-SAMBA), a model of planning for the expansion of long-term energy systems. The modeling exercise supports the argument that greater electricity integration in Mercosur (and in South America as a whole) promotes a reduction in the need to increase installed capacity, as well as lower geographic and socio-environmental impacts. Keyword: Energy Security; Energy Integration; Mercosur; UNASUR. JEL Codes: C6, N76, O13, Q4
    Date: 2018–12–28

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.