nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2020‒10‒19
37 papers chosen by
Bernardo Bátiz-Lazo
Northumbria University

  1. Attaining autonomy in the empire: French governors between 1860 and 1960 By Scott Viallet-Thévenin; Cédric Chambru
  3. War, Socialism and the Rise of Fascism: An Empirical Exploration By Daron Acemoglu; Giuseppe De Feo; Giacomo De Luca; Gianluca Russo
  4. History and Urban Economics By W. Walker Hanlon; Stephan Heblich
  5. Bubbles in history By Quinn, William; Turner, John D.
  6. Life after Crossing the Border: Assimilation during the First Mexican Mass Migration By David Escamilla-Guerrero; Edward Kosack; Zachary Ward
  7. Monetary Policy Cooperation/Coordination and Global Financial Crises in Historical Perspective By Michael D. Bordo
  9. Financial inclusion with hybrid organisational forms: Microfinance, philanthropy, and the poor law in Ireland, c. 1836-1845 By McLaughlin, Eoin; Pecchenino, Rowena A.
  10. Management Guide Agricultural Division By Luc Marco
  11. THE GERMAN ANTI-KEYNES? ON WALTER EUCKEN’S MACROECONOMICS By Feld, Lars P.; Koehler, Ekkehard; Nientiedt, Daniel; Assistant, JHET
  12. The Public Accounts of the Basque Economic Agreement in Times of Change and Economic Crisis (1929-1935). Quantitative Sources and Accounting Methodology By Mikel Erkoreka
  13. The Demography of Industrial Firms in France 1973-1980 By Luc Marco
  14. The Gravitational Constant? By David S. Jacks; Kevin Hjortshøj O’Rourke; Alan M. Taylor
  15. The Great Influenza Pandemic of 1918-20: An interpretative survey in the time of COVID-19 By Prema-chandra Athukorala; Chaturica Athukorala
  16. Shipwrecked by Rents By Arteaga, Fernando; Desierto, Desiree; Koyama, Mark
  18. Six political philosophies in search of a virus: Critical perspectives on the coronavirus pandemic By Gerard Delanty
  19. The Legacy of the Slave Trade: Towards Identifying the Causal Impact of Mistrust in Medicine on Demand for Vaccination in Sub-Saharan Africa By Athias, Laure; Macina, Moudo
  20. Growth factors in developed countries: A 1960-2019 growth accounting decomposition By Gilbert Cette; Aurélien Devillard; Vincenzo Spiezia
  21. Concessions, Violence, and Indirect Rule: Evidence from the Congo Free State By Sara Lowes; Eduardo Montero
  22. The role of foreign direct investment in growth: Spain, 1964-2013 By Bajo-Rubio, Oscar
  23. Wealth Mobility in the 1860s By Dupont, Brandon; Rosenbloom, Joshua L.
  24. Crisis Innovation By Tania Babina; Asaf Bernstein; Filippo Mezzanotti
  25. Beyond Financialisation: The Need for a Longue Durée Understanding of Finance in Imperialism By Koddenbrock, Kai; Kvangraven, Ingrid Harvold; Sylla, Ndongo Samba
  27. Impediments to the Schumpeterian Process in the Replacement of Large Firms By Mara Faccio; John J. McConnell
  28. Girls and their families in an era of economic change introduction By Humphries, Jane
  31. Mapping the Third Republic. A Geographic Information System of France (1870–1940) By Victor Gay
  32. Des exceptions opposables par la caution au créancier By Kouroch Bellis
  33. Close Encounters of the European Kind: Economic Integration, Sectoral Heterogeneity and Structural Reforms By Campos, Nauro F.; Eichenauer, Vera Z.; Sturm, Jan-Egbert
  34. Thirty Years After: Economic Growth in Transition Countries By Josip Tica; Viktor Viljevac
  35. This paper provides a long-term perspective to the causal linkages between currency dynamics and macroeconomic conditions by utilising a long span data set for the United Kingdom that extends back to 1856 and a time-varying causality testing methodology that accounts for the nonlinearity and structural breaks. Using unemployment fluctuations as a proxy for macroeconomic conditions and wavelet decompositions to obtain the fundamental factor that drives excess returns for the British pound, time varying causality tests based on alternative model specifications yield significant evidence of causal linkages and information spillovers across the labour and currency markets over the majority of the sample. Causal effects seem to strengthen during the Great Depression and later following the collapse of the Bretton Woods system, highlighting the role of economic crises in the predictive linkages between the two markets. While the predictive role of currency market dynamics over unemployment fluctuations reflects the effect of exchange rate volatility on corporate investment decisions, which in turn, drives subsequent labour market dynamics (e.g. Belke & Gross (2001); Belke & Kaas (2004); Feldman (2011); among others), we argue that causality in the direction of exchange rates from unemployment possibly reflects the signals regarding monetary policy actions, which in turn, spills over to financial markets. Overall, the findings indicate significant information spillovers across the labour and currency markets in both directions with significant policy making implications. By Deven Bathia; Riza Demirer; Rangan Gupta; Kevin Kotze
  36. Political instability and political terror: global evidence on persistence By Asongu, Simplice; Uduji, Joseph; Okolo-Obasi, Elda
  37. Institutional Change and Institutional Persistence By Daron Acemoglu; Georgy Egorov; Konstantin Sonin

  1. By: Scott Viallet-Thévenin; Cédric Chambru
    Abstract: This article builds on the concept of linked ecologies to present a study of the occupational careers of French colonial governors between 1830 and 1960. We consider empires as the by-product of social entities structuring themselves. Specifically, we analyse the process of empowerment of this emerging group with respect to other professional groups within the imperial space and the French metropolitan space. Using data on the career of 637 colonial governors between 1830 and 1960, we examine how variations in the recruitment of these high civil servants actually reflect the empowerment of this social entity. We rely on optimal matching technique to distinguish typical sequence models and identify ten common career trajectories that can be grouped in four main clusters. We further compare the share of each clusters in the population of governors over time and show that the rise of the colonial cluster during the Interwar period corresponded to the peak of the administrative autonomy in the colonial space. We argue that this process is consistent with the empowerment of the governors’ corps, which is embodied by a common career within the colonial administration and a collective identity as a group.
    Keywords: State employment decisions, empowerment, French colonial Empire, 19th century, 20th century
    JEL: D73 F54 H83 J45 M51 N43 N44
    Date: 2020–10
  2. By: Rahman, Jasmeen; Dimand, Robert; Assistant, JHET
    Abstract: We explore disciplinary boundary-making in geographical economics or “the new economic geography” with attention to the approaches taken by, and attempts at communication between, scholars with primary affiliations in economics, geography and regional science. The Dixit-Stiglitz general equilibrium approach to monopolistic competition and increasing returns was applied to agglomeration and location by Paul Krugman, who had previously pioneered the “new trade theory” building on the Dixit-Stiglitz model, and, independently and slightly earlier, by Masahisa Fujita and his student Heshem Abdel-Rahman starting from regional science, a tradition with its own departments, doctorates, conferences and journals distinct from economics and geography. Economic geography, as studied by geographers, had already taken a quantitative and theoretical turn in the 1960s, reviving an earlier tradition of German location theory overshadowed within geography after World War II by areal differentiation. Another strand of economic geography pursued by geographers was influenced by economic theory, but by non-neoclassical Marxian and Sraffian economics. Debates between these scholars raised questions whether these analyses were multidisciplinary, drawing on distinct disciplines, or crossed disciplinary boundaries (as when geographical economics in the style of economists is undertaken in geography departments) or transcends disciplinary boundaries, or involved the emergence of a new discipline.
    Date: 2020–09–21
  3. By: Daron Acemoglu; Giuseppe De Feo; Giacomo De Luca; Gianluca Russo
    Abstract: The recent ascent of right-wing populist movements in many countries has rekindled interest in understanding the causes of the rise of Fascism in inter-war years. In this paper, we argue that there was a strong link between the surge of support for the Socialist Party after World War I (WWI) and the subsequent emergence of Fascism in Italy. We first develop a source of variation in Socialist support across Italian municipalities in the 1919 election based on war casualties from the area. We show that these casualties are unrelated to a battery of political, economic and social variables before the war and had a major impact on Socialist support (partly because the Socialists were the main anti-war political movement). Our main result is that this boost to Socialist support (that is “exogenous” to the prior political leaning of the municipality) led to greater local Fascist activity as measured by local party branches and Fascist political violence (squadrismo), and to significantly larger vote share of the Fascist Party in the 1924 election. We document that the increase in the vote share of the Fascist Party was not at the expense of the Socialist Party and instead came from right-wing parties, thus supporting our interpretation that center-right and right-wing voters coalesced around the Fascist Party because of the “red scare”. We also show that the veterans did not consistently support the Fascist Party and there is no evidence for greater nationalist sentiment in areas with more casualties. We provide evidence that landowner associations and greater presence of local elites played an important role in the rise of Fascism. Finally, we find greater likelihood of Jewish deportations in 1943-45 and lower vote share for Christian Democrats after World War II in areas with greater early Fascist activity.
    JEL: D72
    Date: 2020–09
  4. By: W. Walker Hanlon; Stephan Heblich
    Abstract: This article reviews recent literature using insights from history to answer central questions in urban economics. This area of research has seen rapid growth in the past decade, thanks to new technologies that have made available increasingly rich data stretching far back in time. The focus is to review innovative methods to exploit historical information and discuss applications of these data that provide new insights into (i) the long run growth of cities or regional economies and (ii) the spatial organization of economic activities within cities. The review also surveys the growing literature outside urban economics that uses the historical urbanization as a proxy for economic growth, discusses differences between how economic historians and urban economists think about the relationship between urbanization and growth, and considers how these views might be reconciled.
    JEL: N7 N9 R00
    Date: 2020–09
  5. By: Quinn, William; Turner, John D.
    Abstract: Bubbles have become ubiquitous. This ubiquity has stimulated research over the past three decades into bubbles in history. In this article, we provide a systematic overview of research into historical bubbles. Our analysis reveals that there is no coherent approach to the study of bubbles and much of the debate has unhelpfully focussed on the rationality/irrationality dichotomy. We then suggest a new framework for the study of historical bubbles, which helps us understand the causes of bubbles and their economic consequences. We conclude by suggesting ways in which business history can contribute to the study of historical bubbles.
    Keywords: Bubbles,Business History,Speculation
    JEL: G01 G10 N10 N20 N80
    Date: 2020
  6. By: David Escamilla-Guerrero; Edward Kosack; Zachary Ward
    Abstract: The first mass migration of Mexicans to the United States occurred in the early twentieth century: from smaller pre-Revolutionary flows in the 1900s, to hundreds of thousands during the violent 1910s, to the boom of the 1920s, and then the bust and deportations/repatriations of the 1930s. We show that despite these large shifts, the rate of economic assimilation was remarkably similar across arrival cohorts. We find that the average Mexican immigrant held a lower-paying job than US-born whites near arrival and further fell behind in the following decade. However, Mexican assimilation was not uniquely slow since we also find that the average Italian immigrant fell behind at a similar rate. Yet, conditional on geography, human capital, and initial earning score, Mexicans had a slower growth rate than both US-born whites and Italians. We argue that Mexican-specific structural barriers help to explain why Mexican progress was slower than other groups and why different Mexican arrival cohorts had limited variation in outcomes despite the large shocks to migration.
    Keywords: assimilation, immigration, Mexico, mobility, mob violence
    JEL: J15 J61 J62 N31 N32
    Date: 2020–10–05
  7. By: Michael D. Bordo
    Abstract: The COVID-19 pandemic spawned a global liquidity crisis in March 2020. The global liquidity crisis was alleviated by the Federal Reserve and other advanced country central banks cooperating by extending the swap lines they developed in the Global Financial Crisis 2007-2008. Central bank cooperation in 2020 evolved from a two-century history across several monetary regimes that is surveyed in this paper. I find that in monetary regimes which are rules-based cooperation was most successful. International currency swaps developed to manage exchange rates during the Bretton Woods era have evolved into the leading tool to manage international liquidity crises. The swap network can be viewed as a step in the direction of a global financial safety net.
    JEL: E58 F33 N20
    Date: 2020–10
  8. By: Assistant, JHET; Graf, Rüdiger
    Abstract: The article examines an early and idiosyncratic version of behavioral economics or “empir-ical socio-economics,” which the German economist and taxation expert Günter Schmölders developed in the postwar decades. Relying on both his published papers and his lecture notes and correspondence, it scrutinizes Schmölders’ intellectual upbringing in the tradition of the Historical School of Economics (Historische Schule der Nationalökonomie) and his relation to the emerging ordoliberalism, demonstrating that the roads that led to dissatisfaction with the emerging neoclassical mainstream and the unrealistic behavioral assumptions of macro-economic models were manifold. Accordingly, it shows that behavioral economics is compati-ble with various intellectual and political backgrounds and convictions. Yet, it still forms a dis-tinct entity: Comparing Schmölders with contemporary and later behavioral economists, I will show that they shared essential methodological assumptions as well as an understanding of human beings as decision-making organisms.
    Date: 2020–09–21
  9. By: McLaughlin, Eoin; Pecchenino, Rowena A.
    Abstract: The turbulent 1830s saw a sequence of great political and social reforms in the UK. One such reform was the introduction of a locally funded poor law in Ireland. The development of a nascent welfare system in 1838 coincided with a boom in the formation of microfinance institutions in Ireland. The focus of this study is the expansion of a hybrid organisational form, Loan Fund Societies (LFSs), in the ten years prior to the Great Irish Famine of 1845-49. LFSs were legally established with a conflictual structure: balancing acting as commercially viable charitable institutions that were required to provide credit to the deserving poor to enable them to be self-sufficient, while dedicating their "profits" to supporting the indigent poor. This study uses an analytical framework drawing inspiration from institutional logics to explore and better understand Irish microfinance in the early nineteenth century, a period of profound socio-economic and socio-religious change. It seeks to explain the factors that motivated the establishment and de-establishment of microfinance institutions amidst this tumult. Legislative changes in LFS business parameters in 1843 made the tensions between being charitable and commercial sustainability salient and, for some, continued existence untenable.
    Keywords: microfinance,institutional logics,development,Ireland
    JEL: G21 H75 I38 N23 N33 N83
    Date: 2020
  10. By: Luc Marco (CEPN - Centre d'Economie de l'Université Paris Nord - USPC - Université Sorbonne Paris Cité - Université Sorbonne Paris Nord - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Comment était gérée une concession de tracteurs et de matériel agricole au milieu des années 1970 ? Dans les archives d'un ancien cadre d'IH France, nous avons retrouvé le guide de gestion de cette marque, pour l'année 1974. En envisageant tous les aspects de la gestion d'une entreprise, ce petit guide peut encore servir aux concessionnaires actuels : a)Pour établir leurs fiches de stockage et de réassortiment ; b)Pour gérer les vendeurs et les spécialistes d'après-vente ; c)Pour comprendre l'évolution du marché du tracteur à long terme ; d)Pour maîtriser l'image de marque de la Concession. Tel quel cet ouvrage est destiné aux étudiants en machinisme agricole, à leurs professeurs et à tous les professionnels intéressés par le domaine. Il intéressera aussi les enseignants-chercheurs en gestion qui cherchent des études de cas vivantes et documentées. Il passionnera les historiens d'entreprises qui veulent saisir l'influence américaine en France dans l'après-guerre et durant les trente Glorieuses.
    Abstract: How was a tractor and farm equipment concession managed in the mid-1970s? In the archives of a former IH France executive, we found the management guide for this brand, for the year 1974. Looking at all aspects of running a business, this little guide can still be used by existing dealers: (a) To establish their storage and reassortment sheets; b) To manage sellers and after-sales specialists; c) To understand the long-term evolution of the tractor market; d) To control the Concession's brand image. This book is intended for agricultural engineering students, their teachers and all professionals interested in the field. It will also be of interest to management professor-researchers looking for lively and documented case studies. He would fascinate business historians who wanted to capture American influence in France in the post-war period and during the Thirty Glorious.
    Keywords: Machinisme agricole,Guide de gestion,France,Agricultural Machinery,Management Guide
    Date: 2020–09–18
  11. By: Feld, Lars P.; Koehler, Ekkehard; Nientiedt, Daniel; Assistant, JHET
    Abstract: The work of Walter Eucken (1891–1950), founder of German ordoliberalism, is often described as being in direct opposition to that of John Maynard Keynes. Our paper challenges this claim by making two main arguments. First, we show that Eucken supported a proto-Keynesian stimulus program at the height of the Great Depression, the so-called Lautenbach plan of 1931. Second, we analyze his critique of full employment policy, which reveals that Eucken’s approach to solving macroeconomic problems is fundamentally different, if not necessarily contrary to that of Keynes.
    Date: 2020–09–21
  12. By: Mikel Erkoreka (Centro de Documentaci—n e Investigaci—n del Concierto Econ—mico y las Haciendas Forales, Universidad del Pa’s Vasco / Euskal Herriko Unibertsitatea (UPV/EHU). Spain)
    Abstract: The main aim of this working paper is to publish the original series of the annual accounts of the Provincial Councils of çlava, Biscay and Gipuzkoa between 1920 and 1935. The budget statistics provide information on revenue, expenditure, tax collection and public debt of the three institutions. In addition, it also develops a methodological model in order to rebuild the historical tax and budgetary series of the Basque treasuries from a long-term perspective, whilst facilitating their comparison with the Spanish and other States accounts.
    Keywords: Basque Economic Agreement, Basque Provincial Councils, Basque Public Treasuries, Spanish Public Treasury, Public Finances, Fiscal Federalism, Great Depression 1929.
    JEL: H61 H77 H83 N01
    Date: 2020–09
  13. By: Luc Marco (CEPN - Centre d'Economie de l'Université Paris Nord - USPC - Université Sorbonne Paris Cité - Université Sorbonne Paris Nord - CNRS - Centre National de la Recherche Scientifique)
    Abstract: A la fin des Trente glorieuses (1945-1973), l'économie française a dû affronter une mutation radicale de son tissu industriel. Pour mesurer cette mutation, une nouvelle discipline économique est née : la démographie des firmes. Celle-ci consiste en la comparaison statistique des créations nouvelles et des disparitions effectives d'entreprises industrielles. Ces dernières disparitions peuvent être estimées par le flux économique des liquidations des biens et des règlements judiciaires. L'analyse de la période des deux premières crises pétrolières a fait l'objet d'une thèse de troisième cycle soutenue en juin 1980 à l'Université de Nice. Cette nouvelle version, ici revue et corrigée, intègre aussi les données disponibles pour l'année terminale. Les sources statistiques sont celles de la Caisse nationale des marchés de l'Etat et de l'Institut national de la statistique et des études économiques. L'approche théorique se situe dans le droit-fil des études françaises d'économie industrielle, qui, de Jacques Houssiaux à Alain Bienaymé, ont permis de mieux comprendre la mutation rapide de l'industrie dont il est question dans cet ouvrage. L'approche archéologique se fonde sur le stock français d'ouvrages et d'articles en économie ou en gestion des entreprises dont l'auteur est l'un des principaux historiens en France et dans le monde francophone.
    Abstract: At the end of the Glorious Thirty (1945-1973), the French economy had to face a radical change in its industrial fabric. To measure this change, a new economic discipline was born: the demographics of firms. This consists of a statistical comparison of new creations and the actual disappearances of industrial enterprises. These latest disappearances can be estimated by the economic flow of property liquidations and court settlements. The analysis of the period of the first two oil crises was the subject of a postgraduate thesis supported in June 1980 at the University of Nice. This new version, reviewed and corrected, also incorporates the data available for the final year. The statistical sources are those of the National State Markets Fund and the National Institute of Statistics and Economic Studies. The theoretical approach is in line with the French studies of industrial economics, which, from Jacques Houssiaux to Alain Bienaymé, have made it possible to better understand the rapid transformation of the industry referred to in this book. The archaeological approach is based on the French stock of books and articles in economics or business management, the author of which is one of the leading historians in France and in the French-speaking world.
    Keywords: Firmes,Démographie,France,1973-1980
    Date: 2020–09–17
  14. By: David S. Jacks; Kevin Hjortshøj O’Rourke; Alan M. Taylor
    Abstract: We introduce a new dataset on British exports at the bilateral, commodity-level from 1700 to 1899. We then pit two primary determinants of bilateral trade against one another: the trade-diminishing effects of distance versus the trade-enhancing effects of the British Empire. We find that gravity exerted its pull as early as 1700, but the distance effect then attenuated and had almost vanished by 1800. Meanwhile the empire effect peaked sometime in the late 18th century before significantly declining in value. It was only after 1950 that distance would once again exert the same influence that it has today.
    Keywords: Distance, empire, gravity
    JEL: F1 N7
    Date: 2020–10–05
  15. By: Prema-chandra Athukorala; Chaturica Athukorala
    Abstract: The Great Influenza Pandemic of 1918-20?commonly known as the Spanish flu?infected over a quarter of the world's population and killed over 50 million people. It is by far the greatest humanitarian disaster caused by infectious disease in modern history. Epidemiologists and health scientists often draw on this experience to set the plausible upper bound (the 'worst case scenario') on future pandemic mortality.
    Keywords: Spanish flu, COVID-19, pandemic, infectious
    Date: 2020
  16. By: Arteaga, Fernando; Desierto, Desiree; Koyama, Mark
    Abstract: The trade route between Manila and Mexico was a monopoly of the Spanish Crown for more than 250 years. The Manila Galleons were “the richest ships in all the oceans”, but much of the wealth sank at sea and remain undiscovered. We introduce a newly constructed dataset of all of the ships that travelled this route. We show formally how monopoly rents that allowed widespread bribe-taking would have led to overloading and late ship departure, thereby increasing the probability of shipwreck. Empirically, we demonstrate not only that these late and overloaded ships were more likely to experience shipwrecks or to return to port, but that such effect is stronger for galleons carrying more valuable, higher-rent, cargo. This sheds new light on the costs of rent-seeking in European colonial empires.
    Keywords: Corruption, Rent-seeking, Bribery, Shipwrecks
    JEL: K00 N00 N13
    Date: 2020–09–16
  17. By: Walraevens, Benoît; Assistant, JHET
    Abstract: A review of “Self-Love, Egoism and the Selfish Hypothesis. Key Debates from Eighteenth-Century British Moral Philosophy” by Christian Maurer
    Date: 2020–09–21
  18. By: Gerard Delanty
    Abstract: The Coronavirus (Covid-19) poses interesting questions for social and political thought. These include the nature and limits of the ethical responsibility of the state, personal liberty and collective interests, human dignity, and state surveillance. As many countries throughout the world declared states of emergency, some of the major questions in political philosophy become suddenly highly relevant. Foucault’s writings on biopolitical securitization and Agamben’s notion of the state of exception take on a new reality, as do the classical arguments of utilitarianism and libertarianism. In this paper, I discuss six main philosophical responses to the pandemic, including provocative interventions made by Agamben, Badieu, and Zizek, Latour on the governance of life and death as well as the Kantian perspective of Habermas on human dignity
    Keywords: Agamben, Badieu, Utilitarianism, Habermas, libertarianism, Latour, nudge theory, Zizek
    Date: 2020–05
  19. By: Athias, Laure; Macina, Moudo
    Abstract: There is a large body of anecdotal evidence from sub-Saharan Africa of widespread medical distrust leading to health program failures. In this paper, to isolate an exogenous variation in trust in medicine to explain contemporary health demand in sub-Saharan Africa, we rely on a widespread historical shock: the slave trade. We combine \possessivecite{NunnWantchekon2011} historical data on the slave trade by ethnic group with individual-level data, geolocated at the district level, from the 2010-2014 Demographic and Health Surveys (DHS) to examine the reduced-form relationship between ancestors’ exposure to the slave trade and children vaccination status against measles. Exploiting variations both within countries and districts, we find that children from mothers whose ancestors were exposed to the slave trade are less likely to be vaccinated. The size of the effect offsets or even dominates the ones obtained for standard determinants of health demand, such as education or revenue. Evidence from a variety of identification strategies shows that the slave trade affects demand for vaccination only through trust in medicine. We then provide explanations for the persistent effect of the slave trade. Consistent with the economic approach, we identify religious affiliations and matrilineal lineage systems as important cultural transmission mechanisms. Consistent with the evolutionary anthropology approach, we point to the similarity of the environment across generations due to colonial and contemporaneous abusive medical treatments to explain persistence of optimal mistrusting behavior.
    Keywords: Trust, Medicine, Slave trade, Health, Culture, Cultural transmission
    JEL: D12 I12 I18 J15 N57 Z13
    Date: 2020–09–16
  20. By: Gilbert Cette (Banque de France and Aix Marseille Univ, CNRS, AMSE, Marseille, France); Aurélien Devillard (Aix Marseille Univ, CNRS, AMSE, Marseille, France); Vincenzo Spiezia (OECD)
    Abstract: Using a new and original database, our paper contributes to the growth accounting literature with three original aspects: first, it covers a long period from the early 60's to 2019, just before the COVID-19 crisis; second, it analyses at the country level a large set of economies (30); finally, it singles out the growth contribution of ICTs but also of robots. The original database used in our analysis covers 30 developed countries and the Euro Area over a long period allowing to develop a growth accounting approach from 1960 to 2019. This database is built at the country level. Our growth accounting approach shows that the main drivers of labor productivity growth over the whole 1960-2019 period appear to be TFP, non-ICT and non-robot capital deepening, and education. The overall contribution of ICT capital is found to be small, although we do not estimate its effect on TFP. The contribution of robots to productivity growth through the two channels (capital deepening and TFP) appears to be significant in Germany and Japan in the sub-period 1975-1995, in France and Italy in 1995-2005, and in several Eastern European countries in 2005-2019. Our findings confirm also the slowdown in TFP in most countries from at least 1995 onwards. This slowdown is mainly explained by a decrease of the contributions of the components 'others' in the capital deepening and the TFP productivity channels.
    Keywords: growth, productivity, ICTs, robots
    JEL: O31 O33 O47
    Date: 2020–10
  21. By: Sara Lowes; Eduardo Montero
    Abstract: All colonial powers granted concessions to private companies to extract natural resources during the colonial era. Within Africa, these concessions were characterized by indirect rule and violence. We use the arbitrarily defined borders of rubber concessions granted in the north of the Congo Free State to examine the causal effects of this form of economic organization on development. We find that historical exposure to the concessions causes significantly worse education, wealth, and health outcomes. To examine mechanisms, we collect survey and experimental data from individuals near a former concession boundary. We find that village chiefs inside the former concessions provide fewer public goods, are less likely to be elected, and are more likely to be hereditary. However, individuals within the concessions are more trusting, more cohesive, and more supportive of sharing income. The results are relevant for the many places that were designated as concessions to private companies during the colonial era.
    JEL: D72 N47 O15 O43 Z1 Z13
    Date: 2020–10
  22. By: Bajo-Rubio, Oscar
    Abstract: Foreign direct investment (FDI) has played a major role in the deep process of transformation experienced by the Spanish economy since the first 1960s, which even intensified following the integration with the now European Union (EU) in 1986. In this paper, we analyse the long-run effects of FDI in Spain, by estimating a production function including the foreign capital stock over the period 1964-2013. We find a significant contribution of foreign capital on the accumulated growth of GDP over the period of analysis, which seems however to have been greater during the first years of the period analysed.
    Keywords: Economic growth,Foreign direct investment
    JEL: F21 F43 O40
    Date: 2020
  23. By: Dupont, Brandon; Rosenbloom, Joshua L.
    Abstract: We offer new evidence on the regional dynamics of wealth holding in the United States over the Civil War decade based on a hand-linked random sample of wealth holders drawn from the 1860 census. Despite the wealth shock caused by emancipation, we find that patterns of wealth mobility were broadly similar for northern and southern residents in 1860. Looking at the determinants of individual wealth holding in 1870, we find that the elasticity with respect to 1860 wealth was quite low in both regions—consistent with high levels of wealth mobility.
    Date: 2020–09–18
  24. By: Tania Babina; Asaf Bernstein; Filippo Mezzanotti
    Abstract: The effect of financial crises on innovation is an unsettled and important question for economic growth, but one difficult to answer with modern data. Using a differences-in-differences design surrounding the Great Depression, we document that local distress caused a sudden and persistent decline in patenting by the largest organizational form of innovation at this time—technological entrepreneurs. Parallel trends prior to the shock, evidence of a drop within every major technology class, and consistent results using distress driven by commodity shocks—all suggest a causal effect of distress. Despite this, we find that innovation during crises can be more resilient than it may appear at first glance. First, there is no observable change in the number of future citations, despite the decline in the number of patents filed. Second, the shock is in part absorbed through a reallocation of inventors into firms, who over the long-run produce patents with greater impact. Third, the results reveal no immediate brain drain of inventors from the affected areas. Overall, we demonstrate that crises can be both destructive and creative forces for innovation, and provide the first systematic evidence of the role played by the Great Depression in the long-run organization of innovative activity.
    JEL: G01 G21 N12 N22 N32 O3
    Date: 2020–09
  25. By: Koddenbrock, Kai; Kvangraven, Ingrid Harvold; Sylla, Ndongo Samba
    Abstract: One of the central premises of the literature on financialisation is that we have been living in a new era of capitalism, characterised by a historical shift in the finance-production nexus. Finance has begun to behave ‘abnormally’ towards production. It has expanded to a disproportionate economic size and, more importantly, has divorced from ‘legitimate’ economic pursuits. In this paper we explore these claims of ‘expansion’ and ‘divorce’. We argue that although there has been expansion of financial motives and practices the ‘divorce’ between the financial and the productive economy cannot be considered a new empirical phenomenon having occurred during the last decades and even less an epochal shift of the capitalist system. The neglect of the needs of a self-centered economy has been the ‘normal’ and structural operation of finance in most of the former European colonies in the Global South during the last 150 years. We provide evidence to that effect with a longue durée study of the finance-production nexus in Senegal and Ghana. A main result of our empirical exploration is that an understanding of the historical developments of finance under colonialism is key for understanding how capitalist finance works globally. Such a de-centered perspective requires however a serious engagement with the concept and logics of imperialism.
    Date: 2020–09–24
  26. By: Salvat, Christophe; Assistant, JHET
    Abstract: This article questions the articulation between John Stuart Mill’s initial project of creating a new science dedicated to the means of improving individual character, a science named ethology, and the treatise of political economy that he published instead. My claim is that his defence of free competition as well as some of the arguments he opposes to it, and which have often puzzled his readers, actually reveal the moral agenda of his political economy and of some of his political principles, specifically his ambivalent position towards paternalism.
    Date: 2020–09–21
  27. By: Mara Faccio; John J. McConnell
    Abstract: Using newly-assembled data encompassing up to 75 countries and starting circa 1910, we find that the Schumpeterian process of creative destruction aptly describes the replacement of large firms by other firms, but exceptions to the norm of replacement are not rare and replacement is often not by new firms. Initial firm size and political connections represent the main obstacles to the Schumpeterian process while board interlocks and a corporate culture of innovation play modest roles. Consistent with a theory of political capture, when accompanied by regulations that restrict entry, political connections play a formidable role in abetting large firms remaining large.
    JEL: G3 G38 O16 P16
    Date: 2020–09
  28. By: Humphries, Jane
    JEL: N0 R14 J01
    Date: 2020–08–17
  29. By: Cheney, Paul; Assistant, JHET
    Abstract: A review of the book "Political Economy in the Habsburg Monarchy 1750-1774: The Contribution of Ludwig Zinzendorf" by Simon Adler
    Date: 2020–09–21
  30. By: Dupont-Kieffer, Ariane; Rivot, Sylvie; Madre, Jean-Loup; Assistant, JHET
    Abstract: The golden age of road demand modeling began in the 1950s and flourished in the 1960s in the face of major road construction needs. These macro-models as well as the econometrics and the data to be processed, were mainly provided by engineers. A division of tasks can be observed between the engineers in charge of estimating the flows within the network, and the transport economists in charge of managing these flows once they are on the road network. Yet the inability to explain their decision-making processes and individual drives gave some room to economists to introduce economic analysis, so as to better understand individual or collective decisions between transport alternatives. Economists, in particular McFadden, began to offer methods to improve the measure of utility linked to transport, and to inform the engineering approach. This paper explores the challenges to the boundaries between economics and engineering in road demand analysis.
    Date: 2020–09–21
  31. By: Victor Gay (IAST - Institute for Advanced Studies in Toulouse , TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)
    Abstract: This article describes a comprehensive geographic information system of Third-Republic France: the TRF-GIS. It provides annual nomenclatures and shapefiles of administrative constituencies of metropolitan France from 1870 to 1940, encompassing general administrative constituencies (départements, arrondissements, cantons) as well as the most significant special administrative constituencies: military, judicial and penitentiary, electoral, academic, labor inspection, and ecclesiastical constituencies. It further proposes annual nomenclatures at the contemporaneous commune level that map each municipality into its corresponding administrative framework along with its population count. The 901 nomenclatures, 830 shapefiles, and complete reproduction material along with primary sources of the TRF-GIS database are available at TRF-GIS.
    Keywords: GIS,HGIS,Administrative boundaries,Nomenclature,Toponymy,France,Third Republic,SIG,SIGH,Limites administratives,Toponymie,Troisième République
    Date: 2020–10
  32. By: Kouroch Bellis (UP2 - Université Panthéon-Assas)
    Abstract: The question of exceptions that the surety may set up against the creditor is based, currently under French Law, on the distinction between those which are inherent to the debt and those which are purely personal to the principal debtor (Art. 2012 and 2036 French Civil Code of 1804, similar to Art. 1932 and 1958 Civil Code of Lower Canada, Art. 3036 and Art. 3060 Louisiana Civil Code of 1870). This distinction is based on an incidental presentation of Roman Law rules by Pothier (1699-1772) and has resulted currently in many controversies. Notably, a criticized decision of the Cour de cassation decided that fraud is a purely personal exception. The French preliminary project of reform of law of securities intends to resolve the issue by stating that both sorts of exceptions may be set up and by specifying some exceptions. However, the proposed provisions do not clarify the matter and give rise to some difficulties. To resolve the matter, the central place of natural obligations and the civil validity of its suretyship must be asserted. In addition, one should take into account that the Civil Code only mentions the existence of two categories without further detail. Therefore, on the basis of the accessory nature of the suretyship, the distinction should be removed from the law while being kept as legal doctrine and the provisions of the Civil Code should be adapted.
    Abstract: La question des exceptions opposables par la caution au créancier est actuellement fondée sur une distinction entre celles qui sont inhérentes à la dette et celles qui sont purement personnelles au débiteur principal (art. 2289 et 2313). Cette distinction est issue d'une présentation incidente par Pothier de règles de droit romain et a abouti à des controverses. Un arrêt critiqué de la Cour de cassation a notamment fait du dol une exception purement personnelle. L'avant-projet de réforme du droit des sûretés entend résoudre la difficulté en prévoyant que les deux types d'exceptions sont opposables, et en procédant par exceptions spécifiques. Les articles proposés suscitent néanmoins à leur tour des difficultés et n'éclaircissent pas la matière. Pour ce faire, il faut tout d'abord prendre en compte la place centrale de la question de l'obligation naturelle et le fait que son cautionnement est civilement valable. Il faut ensuite constater que la distinction est fonctionnelle et que sa mention en législation fut une simple présentation de l'existence de deux catégories sans plus de précision. Sur cette base et sur celle du caractère accessoire du cautionnement, il conviendrait de supprimer la distinction de la loi – comme cela a été fait au Québec et en Louisiane – tout en la conservant en doctrine et d'adapter la rédaction du Code civil en conséquence.
    Keywords: Obligations,Securities,Contracts,Cautionnement,Sûretés,Obligation naturelle
    Date: 2020–09
  33. By: Campos, Nauro F. (University College London); Eichenauer, Vera Z. (ETH Zurich); Sturm, Jan-Egbert (ETH Zurich)
    Abstract: This paper addresses two main questions: (a) Has European integration hindered the implementation of labour, financial and product market structural reforms? (b) Do the effects of these reforms vary more across sectors than across countries? Using more granular reform measures, longer time windows and a larger sample of countries than previous studies, we confirm that the euro triggered product but neither labour nor financial market reforms. Differently from previous studies, we find that: (a) the Single Market has similar effects to the euro, and (b) sectoral heterogeneity appears less important in explaining the economic impacts of reforms than country heterogeneity.
    Keywords: Euro, Single Market, structural reforms, european integration, sectoral heterogeneity
    JEL: F4 N1 N4 O4
    Date: 2020–09
  34. By: Josip Tica (Faculty of Economics & Business, University of Zagreb); Viktor Viljevac (Faculty of Economics & Business, University of Zagreb)
    Abstract: In this paper, we use a dynamic threshold panel model to investigate the impact of classical and transition specific growth factors on the economic growth of transition countries during 1989-2019. Following Durlauf, Johnson and Temple (2004) we use more than 40 potential ”mainstream” growth factors and we augment the list of factors with transition specific indicators such as privatization methods and various indicators of institutional quality. Given the difficulty in quantifying the economic policies employed in various countries, we explore a wide list of potential threshold variables that can exogenously split the sample into fast and slow-growing countries. We use a range of model specifications and both fixed effects and system GMM estimators as well as Bayesian averaging in order to investigate the robustness of the results. In total more than 16 million estimates are analysed. Preliminary results suggest that the most robust results are for the initial level of development, long term effects of labor market reforms (employment rate), the share of investment, and the importance of the natural resources.
    Keywords: transition, socialist systems, Solow model, institutions, economic growth, threshold model
    JEL: P30 O43 E60
    Date: 2020–10–06
  35. This paper provides a long-term perspective to the causal linkages between currency dynamics and macroeconomic conditions by utilising a long span data set for the United Kingdom that extends back to 1856 and a time-varying causality testing methodology that accounts for the nonlinearity and structural breaks. Using unemployment fluctuations as a proxy for macroeconomic conditions and wavelet decompositions to obtain the fundamental factor that drives excess returns for the British pound, time varying causality tests based on alternative model specifications yield significant evidence of causal linkages and information spillovers across the labour and currency markets over the majority of the sample. Causal effects seem to strengthen during the Great Depression and later following the collapse of the Bretton Woods system, highlighting the role of economic crises in the predictive linkages between the two markets. While the predictive role of currency market dynamics over unemployment fluctuations reflects the effect of exchange rate volatility on corporate investment decisions, which in turn, drives subsequent labour market dynamics (e.g. Belke & Gross (2001); Belke & Kaas (2004); Feldman (2011); among others), we argue that causality in the direction of exchange rates from unemployment possibly reflects the signals regarding monetary policy actions, which in turn, spills over to financial markets. Overall, the findings indicate significant information spillovers across the labour and currency markets in both directions with significant policy making implications.
    By: Deven Bathia (School of Business and Management, Queen Mary University of London); Riza Demirer (Department of Economics & Finance, Southern Illinois University Edwardsville); Rangan Gupta (Department of Economics, University of Pretoria); Kevin Kotze (School of Economics, University of Cape Town)
    JEL: C10
    Date: 2020
  36. By: Asongu, Simplice; Uduji, Joseph; Okolo-Obasi, Elda
    Abstract: We test the hypotheses that fundamental characteristics in regional proximity, landlockedness, religious-domination, legal origin, and income levels affect cross-country differences in the persistence in political terror and political instability in 163 countries for the period 2010 to 2015. The empirical evidence is based on Generalised Method of Moments. The hypotheses are that the following are associated with comparatively higher levels of persistence in political terror and political instability: regions with predominantly low income countries (Hypothesis 1); landlockedness (Hypothesis 2); Christian-orientation (Hypothesis 3); French civil law (Hypothesis 4) and Low income (Hypothesis 5). The tested hypotheses are largely invalid. Only Hypothesis 5 and Hypothesis 2 are robustly investigated in the light of concerns about instrument proliferation. Hypothesis 2 is valid for political terror but not for political instability while Hypothesis 5 is neither valid for political instability nor for political terror.
    Keywords: political instability; political terror; economic development; comparative studies
    JEL: D74 H56 N40 O10 O57
    Date: 2020–01
  37. By: Daron Acemoglu; Georgy Egorov; Konstantin Sonin
    Abstract: In this essay, we provide a simple conceptual framework to elucidate the forces that lead to institutional persistence and change. Our framework is based on a dynamic game between different groups, who care both about current policies and institutions and future policies, which are themselves determined by current institutional choices, and clarifies the forces that lead to the most extreme form of institutional persistence (“institutional stasis”) and the potential drivers of institutional change. We further study the strategic stability of institutions, which arises when institutions persist because of fear of subsequent, less beneficial changes that would follow initial reforms. More importantly, we emphasize that, despite the popularity of ideas based on institutional stasis in the economics and political science literatures, most institutions are in a constant state of flux, but their trajectory may still be shaped by past institutional choices, thus exhibiting “path-dependent change”, so that initial conditions determine both the subsequent trajectories of institutions and how they respond to shocks. We conclude the essay by discussing how institutions can be designed to bolster stability, the relationship between social mobility and institutions, and the interplay between culture and institutions.
    JEL: C73 D72 D74 N10 N40 P16
    Date: 2020–09

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