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on Business, Economic and Financial History |
|
Issue of 2019‒07‒29
forty-two papers chosen by |
| By: | Leandro Prados de la Escosura (Universidad Carlos III, CEPR); Blanca Sánchez-Alonso (Universidad San Pablo-CEU) |
| Abstract: | In assessments of modern Spain’s economic progress and living standards inadequate natural resources, inefficient institutions, lack of education and entrepreneurship, and foreign dependency are frequently blamed for the poor performance up to mid-twentieth century, but no persuasive arguments are provided to explain why such adverse circumstances reversed, giving way to the fast transformation of the last half a century. It makes sense, hence, to inquire firstly how much economic progress has Spain achieved and what impact had on living standards and income distribution since the end of the Peninsular War to the present and, only then, to provide an interpretation. Recent research supports the view that income per person has improved remarkably, driven by increases in labour productivity, which derived, in turn, from a more intense and efficient use of physical and human capital per worker. Exposure to international competition represented a decisive element behind growth performance. In European perspective, Spain underperformed up to 1950. Thereafter, Spain’s economy caught up with advanced countries until 2007. Although the distribution of the fruits of growth did not follow a linear trend, but a Kuznetsian inverted U pattern, higher levels of income per capita are matched by lower inequality suggesting that Spaniards’ material well-being improved substantially during the modern era. |
| Keywords: | Spain, income per person, productivity, inequality, living standards |
| JEL: | N13 N14 O52 I30 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:hes:wpaper:0163&r=all |
| By: | Lamoreaux, N. |
| Abstract: | This essay sets recent expressions of alarm about the monopoly power of technology giants like Google and Amazon in the long history of Americans’ response to big business. It argues that we cannot understand that history unless we realize that Americans have always been concerned about the political and economic dangers of bigness, not just the threat of high prices. The problem policy makers faced after the rise of Standard Oil was how to protect society against those dangers without punishing firms that grew large because they were innovative. The antitrust regime put in place in the early twentieth century managed this balancing act by focusing on large firms’ conduct toward competitors and banning practices that were anticompetitive or exclusionary. Maintaining this balance was difficult, however, and it gave way over time—first to a preoccupation with market power during the post-World War II period, and then to a fixation on consumer welfare in the late twentieth century. Refocusing policy on large firms’ conduct would do much to address current fears about bigness without penalizing firms whose market power comes from innovation. |
| Date: | 2019–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1963&r=all |
| By: | Concha Betrán (University of Valencia); Maria A. Pon (University of Valencia) |
| Abstract: | Among the characteristics of Spanish financial crises over the last 165 years, we highlight their relatively high frequency and, since 1973, their severity (including 2008, the most severe crisis yet). By analysing monetary policy regimes, financial structure, and the main crisis determinants (factors associated with crises), as well as the resolution to the crises, we can conclude that capital flow bonanzas are a key factor in most financial crises; when a capital flow bonanza occurred, it increased both the probability of a subsequent crisis and its severity. |
| Keywords: | Spain, income per person, productivity, inequality, living standards |
| JEL: | N13 N14 O52 I30 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:hes:wpaper:0164&r=all |
| By: | Elena S. Korchmina (National Research University Higher School of Economics) |
| Abstract: | Luxury has always been an intrinsic part of world history, but only in the 18th century the core of this phenomenon came up for discussion in Europe. During these debates the concept of luxury was gradually demoralized by economic liberalism and reshaped as “modern and more objective economic concept”. Eventually the concept of luxury became a universal concept with the only commonly accepted meaning (Sekora). A seminal role in this process played translations, as far as for the continental translators of the key writings “there was no need to invent an entirely new vocabulary of political economy or of cultural practice…” (Reinert). Thus, European thinkers coordinated their positions even if they disagreed with each other. But, how had the notion of luxury been conceptualizing outside of the European Roman world? Russia is an interesting example raising some intellectual puzzles. First of all, it was a relatively backward country, where luxury per se was the essential part of national self-representation. This contradiction caused the real economic problems of indebtedness. One way of fixing it up was the introduction of sumptuary laws which became an important channel of defining the concept of luxury. Secondly, starting from Petrine time Russia got more acquainted with the European political economy masterpieces, translating and adopting them. But “translators lost the security of compatibility when they turned to extra-European languages and traditions” (Reinert). How did Russian translators accomplish the task of describing such a relatively new phenomenon as luxury? By the 1760s, as a result of two processes of the development of legislation and translation the European writings starting the concept of luxury became not an economic term on a large scale, as in European tradition, but a pedagogical project, when the subjects had to acquire mostly the unwritten rules of permissible levels of luxury. |
| Keywords: | luxury, Russia, economic history, legislature, law. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:178/hum/2019&r=all |
| By: | Dincecco, Mark (University of Michigan); Fenske, James (University of Warwick); Menon, Anil (University of Michigan); Mukherjee, Shivaji (University of Toronto) |
| Abstract: | We analyze the relationship between pre-colonial warfare and long-run development patterns in India. We construct a new, geocoded database of historical conflicts on the Indian subcontinent, from which we compute measures of local exposure to pre-colonial warfare. We document a positive and significant relationship between pre-colonial conflict exposure and local economic development across India today. The main results are robust to numerous checks, including controls for geographic endowments, initial state capacity, colonial-era institutions, ethnic fractionalization, and colonial and post-colonial conflict, and an instrumental variables strategy that exploits variation in pre-colonial conflict exposure driven by the cost distance to the Khyber Pass. Using rich archival and secondary data, we show that early state-making and fiscal development, greater political stability, and basic public goods investments are channels through which pre-colonial warfare has influenced local economic development. |
| Keywords: | JEL Classification: |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:426&r=all |
| By: | Rodríguez-Pose, Andrés; von Berlepsch, Viola |
| Abstract: | Does population diversity matter for economic development in the long-run? Is there a different impact of diversity across time? This paper traces the short-, medium-, and long-term economic impact of population diversity resulting from the big migration waves of the late 19th and early 20th centuries to the United States (US). Using census data from 1880, 1900, and 1910, the settlement pattern of migrants across the counties of the 48 US continental states is tracked in order to construct measures of population fractionalization and polarization at county level. Factors which may have influenced both the individual settlement decision at the time of migration as well as county-level economic development in recent years are controlled for. The results of the analysis show that high levels of population fractionalization have a strong and positive influence on economic development in the short-, medium-, and long-run. High levels of polarization, by contrast, undermine development. Despite a stronger effect on income levels in the first 30 years, we find these relationships to be extremely long-lasting: counties with a more heterogeneous population composition over 130 years ago are significantly richer today, whereas counties that were strongly polarized at the time of the migration waves have endured persistent negative economic effects. |
| Keywords: | diversity; fractionalization; polarization; economic development; counties; USA; 269868 |
| JEL: | O1 |
| Date: | 2018–12–04 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:91024&r=all |
| By: | Crafts, Nicholas (University of Warwick) |
| Abstract: | This paper updates the classic growth accounting research of the early 1980s taking account of improved data that has subsequently become available. The picture of long-run growth which results from incorporating many revisions is considerably different. The long-run path of productivity growth is now that of a roller-coaster with twin peaks in the third quarters of the 19th and 20th centuries rather than a U-shape. Productivity growth appears to have been very slow to accelerate in the Industrial Revolution, the notion of an Edwardian climacteric is not persuasive and the current productivity slowdown stands out as unprecedented. |
| Keywords: | Climacteric; Golden Age; Growth Accounting; Industrial Revolution; Productivity Growth; Productivity Puzzle JEL Classification: N13; N14: O47: O52 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:430&r=all |
| By: | Easterlin, Richard A. (University of Southern California) |
| Abstract: | The emergence and evolution of modern science since the 17th century has led to three major breakthroughs in the human condition. The first, the Industrial Revolution, started in the late 18th century and is based chiefly on developments associated with the rise of the natural sciences. The second, the Demographic Revolution, began in the latter half of the 19th century and is largely the result of progress in the life sciences. The third is a Happiness Revolution that commenced in the late 20th century and is the outgrowth of the social sciences. The first two revolutions, both familiar concepts, are summarized briefly; this paper develops the rationale for the third, the Happiness Revolution. It also notes the implications of this perspective for the interpretation of international cross-section studies. |
| Keywords: | Scientific Revolution, Industrial Revolution, Demographic Revolution, happiness, cross section |
| JEL: | N30 I31 C21 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12435&r=all |
| By: | Rosa Duarte; Vicente Pinilla; Ana Serrano |
| Abstract: | Water use has increased notably throughout the world over the last 250 years. The industrial revolution and the long-term economic growth processes, first experienced by Western countries, and then by many other regions, put growing pressure on water resources. If we focus on economic growth, structural change and the rise in per capita income have been key factors in explaining water use trajectories. In addition, population growth has also boosted water needs worldwide. On the contrary, the increase in water use efficiency, mostly driven by technological developments, but also by improved institutions and environmental awareness, has slowed down water requirements. In this general context, our study aims to analyse the drivers of water use from a long-term perspective. More specifically, we analyse world and regional trends in water use over the last century and their relationships with population, economic growth and technological change. We pay particular attention to the second half of the last century and the twenty-first century, given the rising demands linked to trade, the emergence of new economies with increasing per capita income and demands and the smooth technological change observed in developed countries. |
| Keywords: | water history, water use drivers, water long-term trends |
| JEL: | N50 Q15 Q25 Q56 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:seh:wpaper:1903&r=all |
| By: | Matthias Flückiger; Erik Hornung; Mario Larch; Markus Ludwig; Allard Mees |
| Abstract: | We show that the creation of the first integrated pan-European transport network during Roman times influences economic integration over two millennia. Drawing on spatially highly disaggregated data on excavated Roman ceramics, we document that interregional trade was strongly influenced by connectivity within the network. Today, these connectivity differentials continue to influence cross-regional firm investment behaviour. Continuity is largely explained by selective infrastructure routing and cultural integration due to bilateral convergence in preferences and values. Both plausibly arise from network-induced history of repeated socio-economic interaction. We show that our results are Roman-connectivity specific and do not reflect pre-existing patterns of exchange. |
| Keywords: | economic integration, Roman trade, transport network connectivity, business links, cultural similarity |
| JEL: | F14 F15 F21 N73 R12 R40 O18 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7740&r=all |
| By: | Peter Sandholt Jensen (University of Southern Denmark); Cristina Victoria Radu (University of Southern Denmark); Paul Sharp (University of Southern Denmark, CAGE, CEPR) |
| Abstract: | The calculation of the number of days worked per year is crucial for understanding pre-industrial living standards, and yet has presented considerable obstacles due to data scarcity. We present evidence on days worked and seasonality patterns of work using evidence from a large database of micro-level labor market data for eighteenth century rural Denmark. We estimate that workers worked approximately 5.6 days per week when under full employment. Seasonality of work meant, however, that they were unlikely to find employment during the winter, bringing the estimated number of working days per year to 184. This is lower than often assumed in the literature on real wage calculations, but in line with recent evidence for Malmö and London. We find that days worked increased over the eighteenth century, consistent with the idea of an “industrious revolution”. We suggest however that this was probably mostly due to economic necessity rather than a consumer revolution, since unskilled and low skilled workers needed to work over 300 days per year to afford a subsistence basket. |
| Keywords: | working year, seasonality patterns, real wages, annual workers, casual workers, Denmark, eighteenth century |
| JEL: | J22 N33 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:hes:wpaper:0162&r=all |
| By: | John Foster (School of Economics, The University of Queensland) |
| Abstract: | In the United States, the ratio of consumption to GDP has risen steadily over the past half century. In trying to understand why this ratio has increased so much, it is argued that standard models of the consumption function, built up from the neoclassical theory of constrained optimization, cannot offer a satisfactory answer. An alternative perspective is offered whereby aggregate consumption expenditure is seen as primarily the outcome of the population adopting widely upheld rules (‘meso-rules’) in a complex economic system. Aggregate consumption is viewed as the outcome of two contrasting historical processes: one mainly involving pre-committed, rule-bound choices and the other involving open-ended choices, made knowingly in the face of uncertainty, to adopt new meso-rules concerning the consumption of novel kinds of goods and services. The former process provides the degree of order that must be present in any complex system and the latter facilitates evolutionary change to occur. Using over half a century of data, the US consumption function is modelled successfully on the presumption that the economy is a complex system. The evidence supports the hypothesis that the ratio of consumption to GDP has risen because of the diffusion of a ‘culture of consumerism’ in the post-war era and that the limit of this process is now being approached, with important macroeconomic and social implications. |
| JEL: | E00 E01 E10 E2 E21 E60 |
| Date: | 2019–07–25 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:606&r=all |
| By: | Cédric Chambru (Department of Economics, University of Zurich) |
| Abstract: | I use spatial and temporal variation in temperature shocks to examine the effect of adverse weather conditions on the onset of social conflicts in seventeenth- and eighteenth-century France. The paper’s contribution is threefold. First, I document the effect of temperature shocks on standards of living using cross-section and panel prices data. Second, I link high-resolution temperature data and a new database of 8,528 episodes of social conflicts in France between 1661 and 1789. I use a linear probability model with subregional and year fixed effects to establish a causal connection between temperature shocks and conflicts. One standard deviation increase in temperature increased the probability of social conflicts by about 5.3 per cent. To the best of my knowledge, these results are the first to quantify the effect of temperature shocks on intergroup conflict in pre-industrial Europe. Finally, I investigate the role of local leaders– the intendants– in the mitigation of temperature shocks. I show that leaders with higher level of local experience were better able to cope with adverse weather conditions. I argue that years of local experience were a key determinant in the intendant’s ability to administer efficiently his province. This interpretation is supported by historical evidence. |
| Keywords: | Weather shocks, Institutions, Social Conflicts, Grain Prices, France, Ancien Régime |
| JEL: | H12 N53 Q54 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:hes:wpaper:0161&r=all |
| By: | Julien Grandjean |
| Abstract: | This paper participates in the formation of the history of public choice theory. In particular, it will focus on the role of Gordon Tullock and the analysis of the simple majority decision-making process promoted in the famous Calculus of Consent, written along with James M. Buchanan. This paper shows that Tullock has already think about the issue of majority voting prior to the writing of his common book with Buchanan. Between 1959 and 1961 in particular, while Tullock was a postdoctoral fellow at the Thomas Jefferson Center for Studies in Political Economy and Social Philosophy at the University of Virginia and later Assistant Professor in the Department of International Studies at the University of South Carolina, he had an interesting interaction with Anthony Downs about majority decision-making process in a democracy. This interaction that consists in a correspondence between Tullock, Downs and their editors can be found for a part in the Gordon Tullock papers of the Hoover Institution Archives. It gave birth to some major articles by the two authors such as The Problem of Majority Voting by Tullock in 1959, Why the Government Budget is Too Small in a Democracy by Downs in 1960, Problems of Majority Voting: In Defense of Majority Voting by Downs and Problems of Majority Voting: Reply to a Traditionalist by Tullock in 1961. Our purpose is to highlight the interaction that forms the basis of these publications and shows the way Tullock matured his view about the majoritarian rule – one of the cornerstones of the public choice theory – at this time. |
| Keywords: | Gordon Tullock, Anthony Downs, public choice, majority voting, logrolling, unanimity. |
| JEL: | B21 B31 D72 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2019-28&r=all |
| By: | Matthew S. Jaremski; David C. Wheelock |
| Abstract: | Financial network structure is an important determinant of systemic risk. This paper examines how the U.S. interbank network evolved over a long and important period that included two key events: the founding of the Federal Reserve and the Great Depression. Banks established connections to correspondents that joined the Federal Reserve in cities with Fed offices, initially reducing overall network concentration. The network became even more focused on Fed cities during the Depression, as survival rates were higher for banks with more existing connections to Fed cities, and as survivors established new connections to those cities over time. |
| JEL: | G21 L14 N22 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26034&r=all |
| By: | Colvin, Christopher L.; Fliers, Philip |
| Abstract: | Under what conditions can policymakers make demonstrably poor policy choices? By providing a new account of monetary policy management in the Netherlands during the interwar gold standard, we show how policymakers can fail to escape their long-held beliefs and refuse to consider available policy alternatives. Using high-frequency macroeconomic data, we are the first to document that the Netherlands' policymakers were able to conduct an independent monetary policy in the 1930s. We then show how this independence was squandered on fixing the guilder's exchange rate, a policy which led only to deflation, trade deficits, corporate bankruptcies and mass unemployment. We explain the government's policy stance by documenting the beliefs of politicians and central bankers, and then by investigating how business leaders and public intellectuals attempted to influence these beliefs. |
| Keywords: | monetary policy,exchange rate policy,gold standard,interwar period,the Netherlands |
| JEL: | N14 E42 E52 E58 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:qucehw:201903&r=all |
| By: | Clement Tisdell (University of Queensland [Brisbane]); Serge Svizzero (CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de La Réunion) |
| Abstract: | After a long period of substantial economic growth and population increase in the Early Bronze Age, the reason(s) for the relatively rapid disappearance of Únĕtice cultural populations in Silesia and the subsequent lack of population in much of their former territory for around 200 years remains unclear. Various theories have been proposed for these developments, such as changed long distance trade routes or the depletion of materials for bronze-making. However, these fail to explain why large areas formerly occupied by the Únĕtice cultural population remained unoccupied (or virtually so) for so long after their abandonment. We argue, on the basis of demographic and other scientific evidence, that the collapse of this population was primarily the result of unsustainable ecological development. Human-induced changes to ecosystems eventually reduced agropastoral productivity, substantially reduced the standard of living of the populations involved and resulted in the abandonment of their settlements. The extent and nature of ecological damage was such that it took a considerable amount of time for natural ecosystems to recover sufficiently before the affected areas were economically suitable for resettlement. The possibility that resource shortages for bronze-making and changed trade routes contributed to the unsustainable economic development of Silesian Únĕtice cultural groups is also considered. |
| Keywords: | Agropastoral sustainability,Early Bronze Age,Ecosystem change,Natural resource depletion,Sustainable development,Únĕtice culture |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02145471&r=all |
| By: | Ashley, Richard (Virginia Tech); Tsang, Kwok Ping (Virginia Tech); Verbrugge, Randal (Federal Reserve Bank of Cleveland) |
| Abstract: | The origins of the Great Inflation, a central 20th century U.S. macroeconomic event, remain contested. Prominent explanations are poor forecasts or deficient activity gap estimates. An alternative view: the FOMC was unwilling to fight inflation, perhaps due to political pressures. Our findings, based on a novel approach, support the latter view. New econometric tools allow us to credibly identify the particular activity gap, if any, in use. Persistence-dependent unemployment (gap) responses in the 1970s were essentially the same pre- and post-Volcker. Conversely, FOMC behavior vis-à-vis inflation—also persistence-dependent—changed markedly starting with Volcker, consistent with (though not proving) the political pressures view. |
| Keywords: | Taylor Rule; Great Inflation; Intermediate Target; Natural Rate; Persistence Dependence; |
| JEL: | C22 C32 E52 |
| Date: | 2019–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwq:181401&r=all |
| By: | Meseguer, Covadonga; Jaupart, Pascal; Aparicio, Javier |
| Abstract: | We explore how the reception of remittances affects perceptions of the bilateral relationship between Mexico and the U.S. Scholars have claimed that the economic benefits of the relationship with the U.S. prevail over imperialistic concerns stemming from the asymmetry of power between the two countries. Empirical research shows that Latin American public opinion is indeed more supportive of the U.S. than the theory predicts. We identify, however, two gaps in this literature: first, scholars have explored the determinants of generic expressions of sentiment toward the U.S., overlooking more concrete instances of cooperation between the two countries. Second, scholars have focused on trade and investment and have ignored how the material gains of emigration shape attitudes toward the U.S. Using novel survey data on the bilateral relationship between Mexico and the U.S., our paper fills these two gaps. On one hand, we find that while the reception of remittances correlates positively with good sentiments toward the U.S., those that receive remittances are consistently more opposed to cooperation with the U.S. in the fight against drug trafficking. We argue that this finding can be explained by the different nature of the migratory phenomenon, and the connection between anti-drug trafficking policies and the close scrutiny of illegal flows of money and people. |
| Keywords: | pro-Americanism; emigration; remittances; Mexico-US bilateral relation; war on drugs; crime; foreign policy |
| JEL: | N0 F3 G3 |
| Date: | 2017–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:80926&r=all |
| By: | D'Alessandro, Simone; DISTEFANO, Tiziano |
| Abstract: | This paper focuses on the interaction between the legacy of institutional arrangements and incentives on long-term development. We recalled two studies focusing on the long term effects of geographic discontinuities in colonial practice in India and Peru and we confronted the two historical cases as to emphasise the role of capital accumulation and equality of distribution. Furthermore, we propose an evolutionary game model to capture the evolutionary dynamics of institutional assets defining egalitarian or iniquitous income divisions in a non-cooperative setting. This framework sheds light on the role of the colonial governments in the interaction between local institutions and foreign colonial rule in terms of distribution, resources extraction, social asymmetries and finalised investments. |
| Keywords: | Colonialism, Evolutionary Game Theory, Solow growth theory, inequality |
| JEL: | F43 O1 P3 |
| Date: | 2019–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94836&r=all |
| By: | Salvador Barberà; Walter Bossert; Kataro Suzumura |
| Abstract: | Pierre Daunou, a contemporary of Borda and Condorcet during the era of the French Revolution and active debates on alternative voting rules, proposed a method that chooses the strong Condorcet winner if there is one, otherwise eliminates Condorcet losers and uses plurality voting on the remaining alternatives. We axiomatically characterize his method which combines potentially conflicting criteria of majoritarianism by ordering them lexicographically. This contribution serves not just to remind ourselves that a 19th-century vintage may still retain excellent aroma and taste, but also to open up a novel way of applying potentially conflicting desiderata by accommodating them lexicographically. |
| Keywords: | voting rules, Daunou's method, Condorcet criterion |
| JEL: | D71 D72 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1107&r=all |
| By: | Claude DIEBOLT; Michael J. HAUPERT |
| Abstract: | In a recent article Stefano Fenoaltea (2018) bemoaned the loss of respect and focus on the importance of creating databases, or “measurement” as he referred to it. Cliometrics has made and continues to make valuable contributions not just to the field of economic history, but economics in general. In particular, we focus on the contribution of cliometrics to the creation of datasets. We highlight several important cases in both the past and present, of recognized important contributions of new datasets to the economics discipline. We argue that Clio has continually focused on, and valued, the creation of new data sets and the clever and novel ways they have been exploited to further the frontiers of knowledge, and that these efforts are both appreciated and recognized. |
| Keywords: | Cliometrics, Databases, Economic history, Measurement. |
| JEL: | A10 A12 B41 C81 C82 N00 N01 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2019-30&r=all |
| By: | Hardik A. Marfatia (Department of Economics, Northeastern Illinois University, BBH 344G, 5500 N. St. Louis Ave., Chicago, IL 60625, USA); Rangan Gupta (Department of Economics, University of Pretoria, Pretoria, South Africa); Stephen M. Miller (University of Nevada, Las Vegas - Department of Economics, 4505 S. Maryland Parkway, Box 456005, Las Vegas, NV 89154) |
| Abstract: | This paper examines the effect of fiscal policy on financial markets over a long span of 125 years. Unlike existing studies that mainly focus on monetary policy shocks and model-based identification of fiscal policy shocks, we use a time-varying model to study the effect of fiscal policy with much cleaner and direct identification of fiscal policy shocks. In addition, we extend our analysis by measuring the response volatility in these markets and separately study the effects of good and bad components of volatility. We find significant time-variation in the response of stock and bond market returns and volatility. The overall response of the stock market exceeds that of bond markets, with more pronounced effects in the pre-1950 period than in the last six decades. Fiscal consolidation generates long-term benefits that positively affect financial markets in the latter part of the 20th century, thus providing new insights into the dynamic role of fiscal policy. |
| Keywords: | Fiscal Policy, Time-Varying impact, Financial returns and risks |
| JEL: | E5 C32 G14 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:201956&r=all |
| By: | Jeremy Greenwood (University of Pennsylvania); Nezih Guner (Centro de Estudios Monetarios y Financieros (CEMFI)); Karen A. Kopecky (Federal Reserve Bank of Atlanta) |
| Abstract: | The 19th and 20th centuries saw a transformation in contraceptive technologies and their take up. This led to a sexual revolution, which witnessed a rise in premarital sex and out-of-wedlock births, and a decline in marriage. The impact of contraception on married and single life is analyzed here both theoretically and quantitatively. The analysis is conducted using a model where people search for partners. Upon finding one, they can choose between abstinence, marriage, and a premarital sexual relationship. The model is confronted with some stylized facts about premarital sex and marriage over the course of the 20th century. Some economic history is also presented. |
| Keywords: | age of marriage, contraceptive technology, never-married population, number of partners, out-of-wedlock births, premarital sex, singles |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:eag:rereps:31&r=all |
| By: | Lee, Ronald D. (University of California, Berkeley) |
| Abstract: | Paul Samuelson made a series of important contributions to population theory for humans and other species, evolutionary theory, and the theory of age structured life cycles in economic equilibrium and growth. The work is highly abstract but much of it was intended to illuminate issues of compelling policy importance, such as declining fertility and population aging. While his work in population economics has been very influential, his work in population and evolution appears to have been largely overlooked, perhaps because he seldom published in demographic journals or went to population meetings. Here I discuss his many contributions in all these areas, but give particular attention to demographic aspects of his famous work on overlapping generation models, social security systems, and population growth. |
| Keywords: | Samuelson, overlapping generations, social security, population growth rate, reproductive value, population cycles, intergenerational transfers, predator-prey, altruism |
| JEL: | J11 J18 Q57 H55 D64 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12442&r=all |
| By: | Marjorie Grice–hutchinson (Universidad de Málaga [Málaga]) |
| Abstract: | After a long series of cumulative efforts, the historians of Economic Thought have agreed substantially on what have been the main contributions of Spanish scholasticism to economic science. They lie in the development of the theory of value and price, the integration of monetary theory in the general theory of prices, the quantitative theory of money, an interesting theory of changes, the general doctrine of interest and the analysis of the tax system. These are ideas that arose in the consideration of the great fundamental questions of just price, usury and tribute. |
| Abstract: | Después de una larga serie de esfuerzos acumulativos, los historiadores del Pensamiento Económico se han puesto sustancialmente de acuerdo sobre cuáles han sido los principales aportes de la escolástica española a la ciencia económica. Radican éstos en el desarrollo de la teoría del valor y del precio, la integración de la teoría monetaria en la teoría general de los precios, la teoría cuantitativa del dinero, una interesante teoría de los cambios, la doctrina general del interés y el análisis del sistema tributario. Se trata de ideas que surgieron en la consideración de las grandes cuestiones fundamentales del justo precio, de la usura y de los tributos. |
| Date: | 2019–07–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02163071&r=all |
| By: | Michael S. Harr\'e; Adam Harris; Scott McCallum |
| Abstract: | Economic theory is a mathematically rich field in which there are opportunities for the formal analysis of singularities and catastrophes. This article looks at the historical context of singularities through the work of two eminent Frenchmen around the late 1960s and 1970s. Ren\'e Thom (1923-2002) was an acclaimed mathematician having received the Fields Medal in 1958, whereas G\'erard Debreu (1921-2004) would receive the Nobel Prize in economics in 1983. Both were highly influential within their fields and given the fundamental nature of their work, the potential for cross-fertilisation would seem to be quite promising. This was not to be the case: Debreu knew of Thom's work and cited it in the analysis of his own work, but despite this and other applied mathematicians taking catastrophe theory to economics, the theory never achieved a lasting following and relatively few results were published. This article reviews Debreu's analysis of the so called ${\it regular}$ and ${\it crtitical}$ economies in order to draw some insights into the economic perspective of singularities before moving to how singularities arise naturally in the Nash equilibria of game theory. Finally a modern treatment of stochastic game theory is covered through recent work on the quantal response equilibrium. In this view the Nash equilibrium is to the quantal response equilibrium what deterministic catastrophe theory is to stochastic catastrophe theory, with some caveats regarding when this analogy breaks down discussed at the end. |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1907.05582&r=all |
| By: | Bulut, Mehmet; Korkut, Cem |
| Abstract: | In spite of the fact that the waqfs have existed with the history of humankind and are helpful in all social communities, they have a different and important place in Islamic societies. The waqfs have made assistance and solidarity between individuals organized and institutionalized. Especially in Islamic societies, a great importance has been attached to waqfs. The waqfs that helped institutionalize the concept of infaq met many needs of the community. One of the Islamic states where the waqfs are very active was the Ottoman Empire. The size of the waqf services in the Ottomans expanded so much that, besides the human services, waqfs for injured birds and sick animals were established. The fact that the waqfs are so widespread in the state has made it possible to refer the Ottoman Empire as a waqf civilization. One of the waqf types operating in the Ottoman Empire was the cash waqfs (CWs) which had cash money as capital. The CWs operated its capital with various Islamic finance methods. Revenues from the operating money were used in the direction of waqf purpose. The CWs provided the vital necessities of the society such as education and religion in the period they were active in the Ottoman Empire. Another function of these waqfs was to operate as a micro-credit mechanism. Through these waqfs, the surplus and the accumulated savings in the hands of the asset owners were made available to merchants, farmers, craftsmen, and artisans. Hence, these waqfs have served as resource transfer channels as well as functioning as a charity in the society. The main goal of CWs, which is the pioneer of modern Islamic financial institutions, is different from the goal of Islamic interest-free financial institutions. The CWs did not transfer the profits they got to the waqf founder or owner. The income obtained was spent to fulfill the charitable services. Therefore, these institutions created an altruistic finance model operating within the borders of Islamic prohibitions and orders. This model has its own principles. In our study, the financial mentality of the Ottoman society in the context of the CWs and how this mentality shaped the CWs will be discussed. The basic principles of this mentality and model will be emphasized. |
| Keywords: | Cash Waqfs; Ottoman Empire; Islamic Finance; Philanthropy; Altruistic Finance Model; basic principles of cash waqfs |
| JEL: | G21 N20 P45 Z12 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94784&r=all |
| By: | Alberto Batinti; Joan Costa-i-Font; Timothy J. Hatton |
| Abstract: | We study the health effects of the spread of democratic institutions and the extension of voting rights in 15 European countries since the middle of the nineteenth century. We employ both cross country and cohort variation in heights and employ a new instrument for democracy and the extension of the franchise, the effect of decolonisation on democracy in the colonising country’s democratisation to identify the causal effect of democracy on heights. We find robust evidence of a link between democratic quality and human stature. The results indicate that the transition to democracy increased average male heights by 0.7 to 1 cm, equivalent to a one-decade average increase in stature across cohorts. Including the extension of the franchise to women increases the effect on average stature to about 1.7cm. The effect is driven by both to political participation and contestation in reducing inequality and expanding health insurance coverage. |
| Keywords: | height, democracy, transition, voting rights expansions, franchise |
| JEL: | H10 I10 J10 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7701&r=all |
| By: | Schneider, Eric B.; Ogasawara, Kota |
| Abstract: | This paper assesses how the disease environment, proxied by infant mortality rates, influenced children’s growth in interwar Japan. We use data drawn from government records from 1929 to 1939 which report the mean heights of boys and girls in school at each age (6-18) for each of Japan’s 47 prefectures. We focus on two key questions: 1) how important was the disease environment in infancy in shaping the growth pattern of children? and 2) were shocks to child health more salient in the first thousand days of life, often held as a critical window to prevent stunting, or at later ages? We quantify the characteristics of growth pattern of birth cohorts using the SITAR growth model and then relate the predicted SITAR parameters to infant mortality in the year of birth. In addition, we test for instantaneous effects of morbidity, proxied by infant mortality, on growth at ages 6-11. We find that infant mortality in early life did not have a strong influence on the growth pattern of children, but there were statistically significant and economically meaningful instantaneous effects of infant mortality on child height at ages 6-11 for both boys and girls. This suggests that interventions outside of the thousand-day critical window can be effective and that the secular increase in height in interwar Japan was more strongly influenced by cumulative responses to the health environment across child development rather than simply improvements in early life health. |
| Keywords: | child growth; disease; health transition; ES/L010267/1 |
| JEL: | I18 J13 N33 N35 O15 |
| Date: | 2018–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:88115&r=all |
| By: | Himanshu |
| Abstract: | This paper contributes to the literature by reviewing levels, trends, and structure of inequality since the early 1990s in India.It draws extensively on the existing literature, supplemented with analyses of multiple data sources, to paint a picture. It notes where different data sources suggest conflicting conclusions that reflect both data challenges and the complexity of the underlying drivers of inequality changes.While the primary focus is on examining trends based on standard economic indicators of income/consumption and wealth, the paper briefly reviews distributions of selected non-monetary indicators, such as education and health. |
| Keywords: | Consumption,Data sources,Economic inequality,Wealth |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp-2019-42&r=all |
| By: | Maxime Yevadian (Université Catholique de Lyon); Roy Arakelian |
| Abstract: | Les découvertes numismatiques récentes justifient un réexamen de la période mal connue des dernières années de la dynastie artaxiade en Grande-Arménie (fondée vers 189 av. J.-C. par Artaxias Ier), et plus particulièrement la période concernant le ou les règnes d'Erato, reine d'Arménie. La vision actuelle, tant historique que numismatique, concernant cette dernière, se limite schématiquement à la considérer comme la fille de Tigrane III qui aurait épousé son frère Tigrane [IV] pour régner une ou deux fois avant d'abdiquer. Cette vision est très largement fondée sur l'analyse faite par Victor Langlois en 1859 dans son ouvrage Numismatique de l'Arménie. Le corpus numismatique est assez limité. En ce qui concerne plus particulièrement les règnes d'Erato, il est en effet réduit à quatre monnaies. Les deux monnaies d'Erato connues jusqu'ici portent son nom, sans aucune ambiguïté, et comportent la légende suivante «ΕΡΑΤΩ ΒΑϹΙΛΕΩϹ ΤΙΓΡΑΝΟΥ ΑΔΕΛΦΗ – Erato, sœur du roi Tigrane ». Deux nouvelles monnaies récemment publiées comportent à l'avers son buste clairement identifiable et au revers la légende suivante : « ΒΑ[ΣΙΛIΣΣA] ΕΡΑΤ[Ω] – La Reine Erato ». Aucun texte, que ce soit de Tacite, de Dion Cassius, d'Auguste ou des historiens romains postérieurs, n'est en mesure de nous éclairer complètement au sujet de cette reine. Nous pensons qu'il faut faire une relecture plus attentive de ces textes en les confrontant aux monnaies connues d'Erato, et plus particulièrement, les passages de Tacite (Annales II, 3-4) qui la présentent comme la sœur de Tigrane («ΕΡΑΤΩ ΒΑϹΙΛΕΩϹ ΤΙΓΡΑΝΟΥ ΑΔΕΛΦΗ»). En effet, l'interprétation traditionnelle qui fait une lecture globalisante des deux paragraphes du texte de Tacite en assimilant les enfants de Tigrane III à Erato et son frère Tigrane, et en supposant leur union selon le texte de Tacite, doit être nuancée. Au terme de cette étude, nous pouvons avancer un certain nombre d'hypothèses et de conclusions plausibles. Nous pouvons légitimement considérer Erato comme une reine arménienne de la lignée artaxiade. Elle est indubitablement la sœur d'un souverain nommé Tigrane, comme indiqué sur les monnaies, sans que nous puissions définitivement préciser de quel Tigrane il s'agit. Elle est très probablement la fille d'Artaxias II. En revanche, nous pensons qu'Erato et son frère Tigrane n'étaient pas mariés. Avec la nouvelle découverte de monnaies, nous pouvons définitivement confirmer qu'Erato a régné plusieurs fois. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02131194&r=all |
| By: | Kennedy, Liam |
| Abstract: | Children growing up in the Ireland of the 1950s will have a clear remembrance of a metaphysical space or place known as Limbo. For Catholics, though not Irish Protestants, this formed part of a spiritual cosmos which viewed Heaven and Hell as opposite poles, with Purgatory and Limbo occupying rather vaguely defined intermediate positions. Fast forward to the present day and hardly any of those born in the new millennium will have the slightest notion of what Limbo was (or is). Yet for generations of families, going back to the dawn of Christianity, there was the fear that failing to baptise an infant before death meant that the infant was condemned either to Hell or to a shadowy existence in a place labelled Limbo. Thus the belief, and associated practices such as the prohibition on burying unbaptised bodies in consecrated ground, is one that is replete with emotional, social, theological and gender implications. This study looks at how Irish mothers look back on these beliefs and their own experiences of Limbo, baptism, churching and the disposal of unbaptised babies. It wonders how and why a deep tradition within the Christian world, and Irish society more particularly, should disappear so quickly and so completely. |
| Keywords: | social history,Ireland,religion,Limbo |
| JEL: | N33 N34 Z12 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:qucehw:201902&r=all |
| By: | Giacomin Favre |
| Abstract: | This paper explores a variety of potential issues one has to address when estimating intergenerational mobility with historical data. Many studies are potentially affected by bias originating from individuals emigrating and thus dropping out of the sample, missing information on the life-cycle, and imperfectly linking data sets. Unique panel data on Zurich’s citizenry between 1799 and 1926 entail information on true intergenerational links, and allow to follow individuals across the globe and time. This information enables me to explore how father-son mobility estimates are affected by excluding emigrating individuals, occupational patterns over the life-cycle, and linking procedures. The results suggest that focusing on geographically immobile individuals might decrease the estimated level of social mobility. The estimated level of mobility depends on both the father’s and the son’s age at classification but does not exhibit a monotone trend in the direction of the bias. Most recent linking procedures do not generate significant bias in the sample of Zurich citizens due to the high level of detail of the data combined with a small population size. |
| Keywords: | Social mobility, geographic mobility, life-cycle, matching, historical data |
| JEL: | J62 J61 N33 N34 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:329&r=all |
| By: | Lychakov, Nikita |
| Abstract: | What are the channels by which financial crises lead to social unrest? This paper examines the period between the major Russian financial crisis of 1899-1902 and the Russian Revolution of 1905. Using newly-constructed aggregate-level data and narrative evidence, this paper finds that in response to the crisis, the Russian government and industry transferred income and wealth from ordinary workers to industrialists and investors. The recipients of transfers weathered the crisis well and profited during the recovery, while employees’ wages and wealth fell behind. The evidence also suggests that businesses required their staff to work more intensively. Ultimately, the distributional effect of the response to the crisis seems to have contributed to the occurrence of labour strikes which culminated in the revolution. |
| Keywords: | financial crises, social unrest, businesses, labour, Russia |
| JEL: | N00 |
| Date: | 2019–07–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:95166&r=all |
| By: | Clement Tisdell (University of Queensland [Brisbane]); Serge Svizzero (CEMOI - Centre d'Économie et de Management de l'Océan Indien - UR - Université de La Réunion) |
| Abstract: | This article presents a simple economic theory (and associated evidence) to explain how some early agriculturally based preindustrial societies developed despite most of their population being subject to Malthusian dynamics. Their development depended on a dominant class limiting its membership and extracting an economic surplus which it could use (among other things) to accumulate capital and advance knowledge thereby adding to this surplus. The evolution of urban centers facilitated this development process. Extraction of the agricultural surplus prevented increased population from dissipating this surplus and curtailing development. Examples are given of early economically extractive and non-inclusive societies which were long lasting. Their persistence is at odds with the views of some contemporary development economists about the development prospects of these types of societies. |
| Keywords: | population dynamics,institutional economics,Malthusian trap,Neolithic development,social inequality and development |
| Date: | 2017–08–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02145482&r=all |
| By: | Provan, Bert |
| Abstract: | Riots, social exclusion, and endless improvement programmes have been a feature of the poorest neighbourhoods in France and England for the last thirty-five years or more—particularly focused on large social housing estates. Programmes of improvement have followed similar paths in each country, with mixed success. This article sets out a short overview of these programmes in each country, then contrasts and compares the objectives, approaches, and outcomes. Each country has key elements of inter-agency working, local and resident participation and planning, large-scale building rehabilitation and demolition programmes, though the French system is more often based on specific local contracts between cities and the central departments. Similar evaluation outcome indicators and frameworks of ‘floor’ and ‘gap’ targets have been set, although evidence of success is limited and, particularly in France, there has been considerable criticism of the approach and framework. In parallel, however, the concept of ‘mixed communities’ has emerged as an alternative strategic approach—intuitively reasonable, politically popular, but lacking an evidence base and often ineffective in dealing with poverty. |
| Keywords: | housing; estate; regeneration; mixed communities; exclusion; ghettos; gentrification |
| JEL: | Q15 |
| Date: | 2017–07–24 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:84242&r=all |
| By: | Schilirò, Daniele |
| Abstract: | This paper is an analysis with comments of the book by Mauro Baranzini and Amalia Mirante Luigi L. Pasinetti: An intellectual biography, London, Palgrave Macmillan, 2018 |
| Keywords: | Luigi Pasinetti; intellectual biography; Cambridge School of Keynesian Economics; growtn theory; structural change |
| JEL: | B3 B5 O41 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:95330&r=all |
| By: | Wixforth, Harald |
| JEL: | G21 G32 L64 N24 N44 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ibfpps:0219&r=all |
| By: | Christopher Hoag (Department of Economics, Trinity College) |
| Abstract: | This paper evaluates whether senior bank executive experience can influence bank outcomes during a financial crisis. Some bank executives in New York City in the crisis of 1907 possessed experience as a senior bank officer at the same bank in New York during the previous nationwide crisis of 1893. The evidence suggests that individual bank deposit losses at the same institution are correlated across these two crises. However, this correlation cannot be explained by the retention of top executives at the bank from the previous financial crisis. |
| Keywords: | financial crisis; executive; learning. |
| JEL: | G21 G32 N21 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:tri:wpaper:1902&r=all |
| By: | Nelson, Jonathan K. (Syracuse University Florence and Harvard Kennedy School); Zeckhauser, Richard (Harvard Kennedy School) |
| Abstract: | Portraits served as a form of social media in the Renaissance. Prominent individuals commissioned portraits to convey their accomplishments and relationships, not merely their images. Political and church leaders, in particular, used the images to bolster their role, but these commissioned works entailed risks, importantly including risks to reputation. A portrait could be unflattering or unrecognizable. It could also be judged to be indecorous, especially if the portrait was perceived as an attempt to elevate an individual above his or her station. |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp19-024&r=all |
| By: | Crafts, Nicholas (University of Warwick); Mills, Terence C. (Loughborough University) |
| Abstract: | We estimate trend UK labour productivity growth using a Hodrick-Prescott filter method. We use the results to compare downturns where the economy fell below its pre-existing trend. We find that the current productivity slowdown has resulted in productivity being 19.7% below the pre-2008 trend path in 2018. This is nearly double the previous worst productivity shortfall ten years after the start of a downturn. On this criterion the slowdown is unprecedented in the last 250 years. We conjecture that this reflects a combination of adverse circumstances, namely, a financial crisis, a weakening impact of ICT and impending Brexit. |
| Keywords: | Brexit; financial crisis; Hodrick-Prescott filter; ICT; productivity slowdown JEL Classification: C22; N13; N14; O47 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:429&r=all |