nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2020‒03‒09
28 papers chosen by
Bernardo Bátiz-Lazo
Bangor University

  1. A Discussion of Thomas Piketty's Capital in the Twenty-First Century: By How Much Is r Greater than g? By Maxim L. Pinkovskiy
  2. Physicians in Imperial Medicine: The Emergence of a Filipino Medical Profession in late Nineteenth Century Manila By Chiba, Yoshihiro
  3. The developmental state: dead or alive? By Wade, Robert H.
  4. Adam Smith's Theory of Value: A Mathematical Statement of his Market Price Discovery Process By Sabiou M. Inoua; Vernon L. Smith
  5. Producto regional en Uruguay durante la Primera Globalización (1872-1908): desigualad decreciente y convergencia entre regiones By Pablo Castro Scavone; Henry Willebald
  6. Crisis Chronicles: The Cotton Famine of 1862-63 and the U.S. One-Dollar Note By James Narron; Donald P. Morgan
  7. Locating the Manhattan housing market: GIS evidence for 1880-1910 By Gray, Rowena; Bowman, Rocco
  8. Liquidating bankers' acceptances: International crisis, doctrinal conflict and American exceptionalism in the Federal Reserve 1913-1932 By Adam, Marc Christopher
  9. The irreversible welfare cost of climate anomalies. Evidence from Japan (1872-1917) By Bassino, Jean-Pascal; Lagoarde-Segot, Thomas; Woitek, Ulrich
  10. Crisis Chronicles – The California Gold Rush and the Gold Standard By James Narron; Donald P. Morgan
  11. Series largas de VAB y empleo regional por sectores, 1955-2018 By Angel De la Fuente; Pep Ruiz
  12. Historical institutional differences and entrepreneurship: the case of socialist legacy in Vietnam By Christian Fisch; Michael Wyrwich; Thi Lanh Nguyen; Jörn H. Block
  13. Franchise Extension and Fiscal Structure in the United Kingdom 1820-1913: A New Test of the Redistribution Hypothesis By Toke Aidt; Stanley L. Winer; Peng Zhang
  14. Crisis Chronicles: Gold, Deflation, and the Panic of 1893 By Thomas Klitgaard; James Narron
  15. Crisis Chronicles: The Man on the Twenty-Dollar Bill and the Panic of 1837 By James Narron; Thomas Klitgaard
  16. Euro Area Macroeconomics : where do we stand twenty years later ? By Catherine Mathieu; Henri Sterdyniak
  17. Trends, Breaks and Persistence in Top Income Shares By Atanu Ghoshray; Issam Malki; Javier Ordóñez
  18. Were Jews in Interwar Poland More Educated? By Ran Abramitzky; Hanna Halaburda
  19. Italy : escaping the high-debt and low-growth trap. By Céline Antonin; Mattia Guerini; Mauro Napoletano; Francesco Vona
  20. Inequality in nineteenth century Manhattan: Evidence from the housing market By Gray, Rowena
  21. Were Banks Ever 'Boring'? By Nicola Cetorelli
  22. Media Competition and News Diets By Charles Angelucci; Julia Cage; Michael Sinkinson
  23. 100 Jahre betriebliche Mitbestimmung in Deutschland By Lesch, Hagen
  24. Structural change in a small natural resource intensive economy. Switching between diversification and re-primarization By Carolina Román; Henry Willebald
  25. Back to the Future: Revisiting the European Crisis By Paolo Pesenti
  26. Crisis Chronicles: The Panic of 1825 and the Most Fantastic Financial Swindle of All Time By James Narron; Donald P. Morgan
  27. The Bright and Dark Side of Financial Support from Local and Central Banks after a Natural Disaster: Evidence from the Great Kanto Earthquake, 1923 Japan By Tetsuji Okazaki; Toshihiro Okubo; Eric Strobl
  28. Economic integration and the distribution of income in Europe: A between country analysis By Atanu Ghoshray; Mercedes Monfort; Javier Ordóñez

  1. By: Maxim L. Pinkovskiy
    Abstract: Thomas Piketty?s 2014 book Capital in the Twenty-First Century may have been a greater sensation upon publication than Karl Marx?s nineteenth-century Das Kapital. It made the New York Times bestseller list, generated myriad reviews and responses from economists at top institutions, and was the subject of a standing-room-only session at the recent American Economic Association annual meeting. In Capital, Piketty argues that wealth inequality is set to rise from its relatively low levels in the 1950s through the 1970s to the very high levels it once occupied at the dawn of the Industrial Revolution?the time of the heroes of Jane Austen and Honor de Balzac. He supports this argument with voluminous evidence on the history of the capital stock and of inequality in developed countries, which he argues have been moving in ways consistent with his theory. Piketty proposes that governments worldwide intervene to prevent this rise in inequality, most importantly by levying a global tax on capital.
    Keywords: capital; technological frontier; inequality; Piketty; growth
    JEL: N2 E2
  2. By: Chiba, Yoshihiro
    Abstract: In the late nineteenth century, Filipino physicians occupied medical officer positions such as Médico Titular and Médico Municipal, where both medicine and welfare were connected through colonial governmental services, especially in Manila and its suburbs. State medicine was launched by the Spanish empire, which was dependent upon the Catholic Church. The number of Filipino physicians who obtained medical licences from the University of Santo Tomas increased up until the 1890s. In addition, owning to cholera epidemics and the Philippine Revolution, the employment of Spanish physicians oscillated greatly during the 1890s. In general, medical care was delivered in patients' homes using native medicinal plants. Such native medicine had not been separated from Spanish imperial medicine. However, not all Filipino physicians necessarily used the medicine promoted by the Spanish empire, and one Filipino physician criticised Spanish medical policies at that time. This paper starts considering the emergence of a Filipino medical profession, first, by investigating public health and medicine in Manila. Consequently, the relationship between the state medicine and physicians will be discussed.
    Date: 2020–02
  3. By: Wade, Robert H.
    Abstract: Before the 1980s, the mainstream Western prescription for developing countries to catch up with the West assigned the state a leading role in governing the market. In the 1980s, this shifted to a framework‐providing role in a largely deregulated and maximally open economy. Also in the 1980s, it became apparent that some East Asian capitalist economies were growing so fast that they would become ‘developed’ in the foreseeable future, marking them out as completely exceptional. Mainstream economists explained their success as the result of following the Western prescription, while other scholars attributed this rapid growth to ‘the developmental state’. This essay compares these two explanations of successful economic development, concluding in favour of the latter — with respect to the catch‐up decades. But what happened subsequently? Several scholars who accept the key role of the developmental state in the early period of fast industrialization in East Asia now argue that South Korea, Taiwan and Singapore have transformed from developmental to close‐to‐neoliberal states. This contribution argues that the erstwhile East Asian developmental states have indeed changed, but they have not transformed into neoliberal states. Rather they have adapted and evolved, but still undertake market‐steering, ‘societal mission’ roles well beyond neoliberal limits. The essay also suggests how other developing countries can learn lessons from their experience.
    JEL: N0
    Date: 2018–03–01
  4. By: Sabiou M. Inoua (Chapman University); Vernon L. Smith (Chapman University)
    Abstract: The relevance of Adam Smith for understanding human morality and sociality is generally accepted; witness the growing interest that his work is stimulating among scholars of various academic backgrounds (philosophers, political theorists, sociologists, economists). But, paradoxically, Adam Smith’s theory of economic value enjoys a less prominent stature to day among economists, who, while they view him as the ‘father of modern economics’, considered him more as having had the right intuitions about a market economy than as having developed the right concepts and the technical tools for studying it. Yet the neoclassical tradition failed to provide a satisfactory theory of price formation owing to the dominant axiom of price taking behavior; for if everyone takes prices as given, how do these prices emerge in the first place? Who is giving the prices? One early escape from this crucial price-discovery problem consisted of assuming that all traders should have complete information of supply and demand and the consequent equilibrium prices (Jevons, [1871] 1888) ; the other, that formed the basis of general equilibrium theory, imagines a fictional auctioneer who finds the equilibrium prices by trial-and-error adjustments or tatonnement (Walras, [1874] 1954). Adam Smith’s theory of the market mechanism (Ch. 7, Book 1, Wealth of Nations, 1776), as we shall argue in this paper, offers the right conceptual framework for understanding competitive price discovery, for which we offer a mathematical formulation. Mathematically, the driving force behind competitive price dynamics is not excess demand per se, but its integral; we make this concept, explored at the beginning in experimental economics (Smith, 1962), part of our formalization of classical competitive price dynamics. Finally, we explain key propositions of Smith’s theory of value in the light of this mathematical formulation.
    Keywords: Methodology of Economics; Micro-economic Theory; Experimental Economics; History of Economic Thought
    Date: 2020
  5. By: Pablo Castro Scavone (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Henry Willebald (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)
    Abstract: We present estimates of regional products in Uruguay during the First Globalization (from the 1870s to the years previous to the World War I). Our results show a decreasing and irregular trend in the regional inequality which is consistent with a process of income convergence between provinces. The irregularity of the trajectory would be evidence of the performance of centrifugal and centripetal forces that alternated influences during the period. The forces that trended to decentralize production were the combination of abundant natural resources suitable for livestock production throughout the territory with the reduction of transport costs that made possible to access more easily to Montevideo and, through its port, to the global market. Centripetal forces would have responded to a process characterized by the increasing importance of Montevideo as urban and administrative center, a huge market of goods and services and a dynamic centre of labour market. In addition, Montevideo evidenced the increasing importance of commercial and financial activities (and its potential for making industrial development more flexible), which was only interrupted by the economic and financial crisis of 1890-1891. In facts, the crisis constituted one of the main equalizing forces of the period. The result was to start the twentieth century with levels of regional inequality lower than those recorded in the 1870s-1880s.
    Keywords: regional inequality, regional convergence, Uruguay
    JEL: N5 N6 N9 R12
    Date: 2019–12
  6. By: James Narron (Executive Office); Donald P. Morgan
    Abstract: When the U.S. Civil War broke out in 1861, cotton was king. The southern United States produced and exported much of the world?s cotton, England was a major textile producer, and cotton textiles were exported from England around the world. At the time, many around the world depended on cotton for their livelihood. The South believed this so deeply that when the North blocked Southern ports to cut off the South?s primary means of financing war?cotton sales?Southern leaders were sure that Britain would enter the war on their side. That never happened. So when cotton supplies dried up in late 1862, thousands in Manchester and Lancashire who either directly or indirectly depended on cotton for a living found themselves without work. In this post, we describe the British cotton famine of 1862-63 and the stoic British national response. We draw primarily from a fascinating BBC Radio broadcast on the subject and John Watts? matter-of-factly named Facts of the Cotton Famine, published in 1866.
    Keywords: famine; king cotton; cotton
    JEL: N2
  7. By: Gray, Rowena; Bowman, Rocco
    Abstract: There is a dearth of systematic information about the historical New York City housing market. We present anew sample containing rental price and characteristic data for almost 10,000 Manhattanunits which was collected from historical newspapers for the period 1880 to 1910. These units were geolocated to the historical map of Manhattan Island to explore theirgeographic coverage, using Geographic Information System (GIS) software. We use this new sample to plot the evolution ofthe locationand quality of available Manhattanhousing units.This complements existing research on the growth of New York City and the evolution of the ethnic composition of neighborhoods across Census years, as we show information at annual frequency during this time of high growth for the city.
    Keywords: historical GIS,New York City,housing markets,neighborhood change
    JEL: N31 N91 R31
    Date: 2020
  8. By: Adam, Marc Christopher
    Abstract: This paper seeks to explain the collapse of the market for bankers' acceptances between 1931 and 1932 by tracing the doctrinal foundations of Federal Reserve policy and regulations back to the Federal Reserve Act of 1913. I argue that a determinant of the collapse of the market was Carter Glass' and Henry P. Willis' insistence on one specific interpretation of the "real bills doctrine", the idea that the financial system should be organized around commercial bills. The Glass-Willis doctrine, which stressed non-intervention and the self-liquidating nature of real bills, created doubts about the eligibility of frozen acceptances for purchase and rediscount at the Reserve Banks and caused accepting banks to curtail their supply to the market. The Glass-Willis doctrine is embedded in a broader historical narrative that links Woodrow Wilson's approach to foreign policy with the collapse of the international order in 1931.
    Keywords: Federal Reserve System,Acceptances,Great Depression
    JEL: B30 E58 F34 N12 N22
    Date: 2020
  9. By: Bassino, Jean-Pascal; Lagoarde-Segot, Thomas; Woitek, Ulrich
    Abstract: This paper presents evidence of the irreversible consequences of exogenous climatic shocks and economic fluctuations on human welfare. We rely on a unique data set covering the period from 1872 to 1917, corresponding to the early phase of Japanese industrialization. This data includes prefecture level average temperature, precipitation, agricultural prices, and the number of individuals by interval of height recorded in conscription reports, as well as nationwide indices of fluctuation in economic activities. We estimate the impact of yearly and monthly regional climate anomalies and yearly nationwide business cycle reversals on the average height of Japanese conscripts and its dispersion.
    Keywords: Business cycles, climate shocks, human stature, height cycles, Japan
    JEL: E32 I15 N15 N95 Q54
    Date: 2020–01
  10. By: James Narron (Executive Office); Donald P. Morgan
    Abstract: On the crisp morning of January 24, 1848, James Marshall, a carpenter in the employ of John Sutter, traveled up the American River to inspect a lumber mill that Sutter had ordered constructed close to timber sources. Marshall arrived to find that overnight rains had washed away some of the tailrace the crew had been digging. But as Marshall examined the channel, something shiny caught his eye, and as he bent over to retrieve the object, his heart began to pound. Gold! Marshall and Sutter tried to contain the secret, but rumors soon spread to Monterey, San Francisco, and beyond?and the rush was on. In this edition of Crisis Chronicles, we describe the excitement of the California Gold Rush and explain how it constituted an inflationary shock because the United States was tied to the gold standard at the time.
    Keywords: gold standard; gold rush
    JEL: G1 E2
  11. By: Angel De la Fuente; Pep Ruiz
    Abstract: En este trabajo se describe la construcción del módulo sectorial de la base de datos RegData FEDEA-BBVA. Las series regionales de empleo, ocupados y asalariados, VAB, salarios medios y remuneración de asalariados de RegData se desagregan en seis grandes sectores, y se desagregan tentativamente los servicios en otros tres This paper describes the construction of the sectoral module of the RegData FEDEA-BBVA database. The RegData regional series of employment, employed and salaried persons, GVA, average salaries and salaried wages are broken down into six large sectors, and services are tentatively broken down into three others
    Keywords: Employment, Empleo, income, renta, Spain, España, Regional Analysis Spain, Análisis Regional España, Working Papers, Documento de Trabajo
    JEL: E01 R1
    Date: 2020–02
  12. By: Christian Fisch (University of Trier); Michael Wyrwich (University of Groningen, and FSU Jena); Thi Lanh Nguyen; Jörn H. Block (University of Trier)
    Abstract: We study the case of Vietnam to assess the long-lasting role of institutional and historical legacy on entrepreneurial outcomes. In particular, we investigate the detrimental effect of socialist institutions on entrepreneurship. Vietnam offers a unique quasi-experimental setting because the country was divided into the socialist North and the nonsocialist South for a relatively short period of two decades. After re-unification the South adopted the institutional framework conditions of the North. To assess the relationship between socialist history and entrepreneurship in this unique setting, we survey more than 3,000 North and South Vietnamese individuals more than four decades after the re-unification of the country. We find that North Vietnamese respondents have lower entrepreneurship intention, are less likely to select into entrepreneurship education programs, and are less willing to engage in business takeover. These patterns indicate the persistence of a long-lasting influence of historical differences in institutional framework conditions on entrepreneurship. The long-run effect of socialism on entrepreneurship is apparently deeper than previously discovered in the prominent case of Germany, where differences in institutional treatment lasted for much longer and ended more recently.
    Keywords: Socialism, Vietnam, entrepreneurship intention, entrepreneurship education, takeover vs. new venture startup
    JEL: D02 L26 M13 P30
    Date: 2020–02–17
  13. By: Toke Aidt; Stanley L. Winer; Peng Zhang
    Abstract: We study the effect of franchise extension on the fiscal structure of central and local governments in the United Kingdom between 1820 and 1913 to revisit the Redistribution Hypothesis - the prediction that franchise extension causes an increase in state-sponsored redistribution. We adopt a novel method of uncovering causality from non-experimental data proposed by Hoover (2001). This method is based on tests for structural breaks in the marginal and conditional distributions of the franchise and fiscal structure time series preceded by a detailed historical narrative analysis. We do not find any compelling evidence that supports the Redistribution Hypothesis.
    Keywords: franchise extension, redistribution, democratization, causality, structural breaks, local government, central government, historical narrative
    JEL: D72
    Date: 2020
  14. By: Thomas Klitgaard; James Narron (Executive Office)
    Abstract: In the late 1800s, a surge in silver production made a shift toward a monetary standard based on gold and silver rather than gold alone increasingly attractive to debtors seeking relief through higher prices. The U.S. government made a tentative step in this direction with the Sherman Silver Purchase Act, an 1890 law requiring the Treasury to significantly increase its purchases of silver. Concern about the United States abandoning the gold standard, however, drove up the demand for gold, which drained the Treasury?s holdings and created strains on the financial system?s liquidity. News in April 1893 that the government was running low on gold was followed by the Panic in May and a severe depression involving widespread commercial and bank failures.
    Keywords: panic 1893 gold silver bimetallism Bryan Friedman monetary policy standard
    JEL: E5 N2
  15. By: James Narron (Executive Office); Thomas Klitgaard
    Abstract: President Andrew Jackson was a \\"hard money\\" man. He saw specie?that is, gold and silver?as real money, and considered paper money a suspicious store of value fabricated by corrupt bankers. So Jackson issued a decree that purchases of government land could only be made with gold or silver. And just as much as Jackson loved hard money, he despised the elites running the banking system, so he embarked on a crusade to abolish the Second Bank of the United States (the Bank). Both of these efforts by Jackson boosted the demand for specie and revealed the soft spots in an economy based on hard money. In this edition of Crisis Chronicles, we show how the heightened demand for specie ultimately led to the Panic of 1837, resulting in a credit crunch that pushed the economy into a depression that lasted until 1843.
    Keywords: panic 1837 jackson specie bank of the United States gold hard money
    JEL: N2
  16. By: Catherine Mathieu (OFCE, Sciences Po, Paris, France); Henri Sterdyniak (OFCE, Sciences Po, Paris, France)
    Abstract: For almost 20 years, euro area countries have been sharing a single currency. The drawbacks of the euro area framework were highlighted by the widening of imbalances prior to the 2007 financial crisis, and thereafter by the huge impact of the financial crisis, the public debt crisis in Southern countries, and the great recession. Prior to and after the crisis, EU institutions and Member States have not been able to implement either a common economic strategy, or satisfactory economic policy coordination. This did lead neither to a burst of the euro area, nor to a substantial change in its functioning. Euro area institutions were adapted, through the European Stability Mechanism, the fiscal treaty,the “first semester”, the European Central Bank’s support to MS, the banking union. Theseadaptations were painful. In mid-2018, the economic situation had clearly improved at the euro area level. However, the following question remains unsolved: can the functioning of the euro area be improved, accounting for divergent situations, interests and views in MS? Section 2 recalls proposals from EU institutions and from MS. Section 3 presents and discusses several economists’ viewpoints and proposals to improve the euro area policy framework. Some economists rely on financial markets to control domestic economic policies, some are in favour of the introduction of a euro zone budget and minister of finance, some are in favour of moving towards a federal EU with increased democracy, some make original proposals to cut publicdebts, and last some advocate better economic policy coordination.
    Keywords: Fiscal policy, policy coordination, EMU governance
    JEL: E62 N14
    Date: 2018–12
  17. By: Atanu Ghoshray (Department of Economics, Newcastle University Business School, UK); Issam Malki (Department of Finance and Accounting, University of Westminster; London, UK); Javier Ordóñez (IEI and Department of Economics, Universitat Jaume I, Castellón, Spain)
    Abstract: We examine the top income share data of a sample of countries to empirically examine for the presence of structural breaks, linear trends and persistence. The analysis of the data is carried out separately for each individual country using novel econometric procedures that are both appropriate and robust. Various theories have been put forward to explain the causes of structural breaks in long run data, such as the introduction of assembly lines from the time of World War I and the ICT revolution. What we find is that there is no clear evidence that Anglo Saxon countries have similar trends as opposed to Nordic, Continental European or other Asian countries. The results are varied and no clear conclusion can be made. Further, the top income share data is found to be highly persistent, suggesting that shocks to the data are likely to be long-lived.
    Keywords: Unit Roots, Top Income Shares, Structural Breaks
    JEL: C22 C32 N30
    Date: 2020
  18. By: Ran Abramitzky; Hanna Halaburda
    Abstract: In the context of interwar Poland, we find that Jews tended to be more literate than non Jews, but show that this finding is driven by a composition effect. In particular, most Jews lived in cities and most non-Jews lived in rural areas, and people in cities were more educated than people in villages regardless of their religion. The case of interwar Poland illustrates that the Jewish relative education advantage depends on the historical and institutional contexts.
    JEL: J1 J15 N34 N94
    Date: 2020–02
  19. By: Céline Antonin (Sciences Po, OFCE); Mattia Guerini (Sciences Po, OFCE); Mauro Napoletano (Sciences Po, OFCE); Francesco Vona (Sciences Po, OFCE)
    Abstract: With its public debt amounting to 132.1% of GDP and its negative productivity growth over the last twenty years, Italy appears to be the sick man of the European Union. In this Policy brief, we focus on its two main plights: high public debt burden on the one hand, sluggish GDP and productivity growth on the other hand. Both issues are intimately related: a slow growth limits the budgetary margins and casts doubts on public debt sustainability; the reduced fiscal space in turn weighs on growth and public investment. The first part is dedicated to describing the history and causes of Italian public debt. A first phase, from the 1960s to the 1980s, was characterized by a positive but moderate growth of debt. A second phase saw the explosion of public debt, from 54% of GDP in 1980 to roughly 117% in 1994. The budget law of the Amato's government in 1992 initiated a third phase, marked by a significant fiscal consolidation effort, and the decrease of the public debt to GDP ratio. The Great Recession interrupted this consolidation era and a last phase began from 2008 on, when the public debt-to-GDP ratio consequently increased. In the second part, we review some of the structural weaknesses of the Italian economy. We notably emphasize the specialization bias towards low tech sectors, the “nanism” of Italian firms, the misallocation of talents and resources, the North-South divide and its related labor market consequences. We conclude with four policy recommendations for a revival of growth in Italy. Our first proposal is technical and proposes a new European fiscal golden rule which would remove specific public investments from the computation of structural primary balance. Our second and third proposals are related to the regulation of the labor market, with the introduction of a minimum wage on the one hand, and the facilitation of retraining policies on the other hand. Last, we call for a revival of industrial policies in order to foster knowledge accumulation and firm learning. Our view is that Italy's fate is inextricably related to Europe's and that Italy needs more rather than less Europe. Classification-JEL: E60, E61, O40
    Keywords: Italy, growth, productivity, public debt
    Date: 2019–05
  20. By: Gray, Rowena
    Abstract: Historical inequality is difficult to measure, especially at the sub-country level and beyond the top income shares. This paper presents new evidence on the level of inequality in Manhattan from 1880 to 1910 using housing rents. Rental prices and characteristics, including geocodable locations, were collected from newspapers and provide extensive geographic coverage of the island, relevant for the overwhelming majority of its population where renting predominated. This provides a measure of consumption inequality at the household level which helps to develop the picture of urban inequality for this period, when income and wealth measures are scarce. For large American cities, but particularly for New York, housing made up a large share of consumption expenditure and its consumption cannot be substituted, so this is a reliable and feasible way to identify the true trends in urban inequality across space and time.
    Keywords: inequality,housing markets,measurement,consumption inequality,New York
    JEL: N31 N91 R31
    Date: 2020
  21. By: Nicola Cetorelli (Brown University; National Bureau of Economic Research; Research and Statistics Group; Federal Reserve Bank; Federal Reserve Bank of New York)
    Abstract: In a previous post, I documented that much of the expansion into nontraditional activities by U.S. banks began well before the passage of the Gramm-Leach-Bliley Act in 1999, the legislation that repealed much of the Glass-Steagall Act of 1933. The historical record actually contains many prior instances of the Glass-Steagall restrictions being circumvented, with nonbank firms allowed to operate as financial conglomerates and engage in activities that go beyond traditional banking. These broad industry dynamics might indicate that the business of banking tends to expand firm boundaries beyond a traditional??boring??perimeter.
    Keywords: Business Scope; Banks; Glass Steagall
    JEL: G2
  22. By: Charles Angelucci (Columbia Business School); Julia Cage (Département d'économie); Michael Sinkinson (Yale School of Management)
    Abstract: News media operate in two-sided markets, offering bundles of content to readers as well as selling readers' attention to advertisers. Technological innovations in content delivery, such as the advent of broadcast television or of the Internet, affect both sides of the market, threatening the basic economic model of print news operations. We examine how the entry of television affected local newspapers as well as consumer media diets in the United States. We develop a model of print media and show that entry of national television news could adversely affect the provision of local news. We construct a novel dataset of U.S. newspapers' economic performance and content choices from 1944 to 1964. Our empirical strategy exploits quasi-random variation in the timing of the entry of television in different markets. We show that the entry of television was a negative shock for newspapers, particularly evening newspapers, in both the readership and advertising markets. Further, we find a drop in the total quantity of news printed, in particular original reporting, raising concerns about the provision of local news.
    JEL: D4 L11 L15 M37 N72
    Date: 2020–02
  23. By: Lesch, Hagen
    Abstract: Im Februar 1920 trat das sogenannte Betriebsrätegesetz in Kraft. Dieses Gesetz stellt die Geburtsstunde der betrieblichen Mitbestimmung in Deutschland dar. Erstmals wurden betriebliche Interessenvertretungen verbindlich verankert und den Betriebsräten Mitwirkungs- und Mitbestimmungsrechte in sozialen und personellen Angelegenheiten eingeräumt.
    Date: 2020
  24. By: Carolina Román (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Henry Willebald (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)
    Abstract: The increasing interest in economic diversification, technological sophistication and production specialization again place structural change at the centre of the analytical and empirical scene of economic development theory. However, efforts to measure structural change from a long-run perspective remain scarce. We aim to fill this gap using a synthetic indicator, based on a trigonometric approach, that represents the dynamics of structural change in the long run and allow us to identify different development patterns. We calculate this indicator including information of thirteen production sectors, for a small natural-resource intensive economy (Uruguay), over 1870-2017. Our results adequately describe the different development patterns that, according to the literature, characterize Uruguayan economic history. In the long run, economic growth causes structural change; only the First Globalization period has the opposite relation. In addition to this, the evolution of our indicator provides other interesting insights. The decline of the index –which indicates “backward movements” in the production structure– is found in periods of economic crisis and downturn cycles. This dynamic reflects critical time periods associated with the (relative) primarization of the economy. In other words, it seems evident that near to each crisis episode, the economy reacted by going back to primary production probably due to looking for traditional comparative advantages or because in such negative phases the weakest and most exposed sectors were those other than agriculture.
    Keywords: structural change, long-run economic patterns, primarization, Uruguay
    JEL: N16 O11 O47
    Date: 2019–12
  25. By: Paolo Pesenti (Centre for Economic Policy Research (CEPR); National Bureau of Economic Research; Yale University; Research and Statistics Group; Federal Reserve Bank of New York)
    Abstract: Recent financial developments are calling into question the future of regional economic integration. Market confidence deteriorates across countries in a contagious way. The place is Europe, the time is . . . now? Or twenty years ago? In fact, in the early 1990s Europe went through a systemic crisis that displays remarkable similarities to today?s events. In this post, we go back to those momentous times and briefly recall how the last Europe-wide crisis started, unfolded, and concluded. The 1992 crisis was eventually resolved, suggesting that there may be some light at the end of the current tunnel as well.
    Keywords: Financial Crisis; EMU; Europe; ERM
    JEL: F00 N2
  26. By: James Narron (Executive Office); Donald P. Morgan
    Abstract: Centered in London, the banking panic of 1825 has been called the first modern financial crisis, the first Latin American crisis, and the first emerging market crisis. And while the panic displayed many of the key elements of past crises we have covered?fluctuations in money growth, an investment bubble, a stock market crash, and bank runs?this crisis had its own twists, including a Bank of England that hesitated before stepping in as lender of last resort. But it is perhaps best known for an infamous bond market swindle surrounding an entirely made-up Central American principality. In this edition of Crisis Chronicles, we explore the Panic of 1825 and visit the mythical nation of Poyais.
    Keywords: panic of 1825; asymmetric information; financial crisis; lender of last resort
    JEL: G1 N2
  27. By: Tetsuji Okazaki (Graduate School of Economics, University of Tokyo); Toshihiro Okubo (Faculty of Economics, Keio University); Eric Strobl (Department of Economics, Bern University)
    Abstract: Natural disasters seriously damage firms and banks. The ability to finance recovery is a key factor for damaged firms to survive and grow after the event. However, small- and medium-sized firms are financially constrained and largely depend on local banks. In this paper, we focus on the Great Kanto Earthquake of 1923, which resulted in serious damage to small- and medium-sized firms and banks in Yokohama City. The crucial solutions were the provision of loans by local banks as well as the Earthquake Bills policy implemented by the Bank of Japan. Using firm- and bank level datasets, we find that larger local banks allowed damaged firms to survive and grow. The policy by the Bank of Japan mitigated the negative impact of bank damage on firms and prevented credit crunch, although this deteriorated the balance sheet of local banks and resulted in financial instability and a banking crisis as a side effect.
    Keywords: Great Kanto Earthquake, Earthquake Bills, Local Bank, Natural Disaster, Japan
    JEL: G21 R10 N25 N85
    Date: 2020–01–13
  28. By: Atanu Ghoshray (Department of Economics, Newcastle University Business School, UK); Mercedes Monfort (IEI and Department of Economics, Universitat Jaume I, Castellón, Spain); Javier Ordóñez (IEI and Department of Economics, Universitat Jaume I, Castellón, Spain)
    Abstract: In this paper we analyse income inequality across EU countries. Monitoring the between-country inequality trend at the EU level provides information about income convergence of EU countries with important implications at highly topical issues such as social cohesion and cross-country migration. In addition to the analysis of the between-country inequality, given that monetary and market integration may affect inequality differently across country-groups, we decompose between-country inequality in its two basic components, that is, inequality between-group and within-group of countries. Groups correspond to non-euro zone, core euro-zone and non- core euro-zone countries. This analysis will allow us to investigate how the observed trend in between-country inequality is related to developments in the between or the within-group component. Three conclusions emerge. First, between-country inequality experienced a trend break at the beginning of the 70s, demarcating of declining inequality to a period where inequality shows no decline up to the introduction of the euro, when betweencountry inequality increased and, consequently, income diverged among European countries. Second, the introduction of the euro was coupled with important recompositional effects of between-country inequality in Europe: from 1999 onwards between-group inequality shapes the developments of between-country inequality, thus, that the observed divergence in income from the beginning of the 2000s is explained by the income divergence between core an non-core countries.Third, shocks to between-country inequality tend to be persistent implying that specific policy measures at the EU level need to be implemented to cope with the undesirable effects of rising inequality.
    Keywords: European Union, structural breaks, economic integration, inequality, unit roots
    JEL: C22 C32 N30
    Date: 2020

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