nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2023‒05‒15
23 papers chosen by
Bernardo Bátiz-Lazo
Northumbria University

  1. Military Spending and Innovation: Learning from 19th Century World Fair Exhibition Data By Alexander M. Danzer; Natalia Danzer; Carsten Feuerbaum
  2. Unconditional Convergence in Manufacturing Productivity across U.S. States : What the Long-Run Data Show By Klein, Alexander; Crafts, Nicholas
  3. Murphy's Law or Luck of the Irish? Disparate Treatment of the Irish in 19th Century Courts By Bindler, Anna; Hjalmarsson, Randi; Machin, Stephen; Rubio-Ramos, Melissa
  4. Do Entrepreneurs Want Control? And Should They Get What They Want? A Historical and Theoretical Exploration By Naomi R. Lamoreaux; Jean-Laurent Rosenthal
  5. Importing sobrie'tea': Understanding the tea trade during the Industrial Revolution By Kabeer Bora
  6. Open Mouth Operations. Monetary Policy by Threats and Arguments. The Monthly Meetings Between the Riksbank and the Commercial Banks, 1956-73 By Jonung, Lars
  7. Immigration Disruptions and the Wages of Unskilled Labor in the 1920s By Jeff Biddle; Elior Cohen
  8. Exposure to War and Its Labor Market Consequences over the Life Cycle By Braun, Sebastian Till; Stuhler, Jan
  9. Economic Origins of the Sicilian Mafia: A Simulation Feedback Model By Oleg V. Pavlov; Jason M. Sardell
  10. Peter I – The King of catching up development By Grigoriev Leonid
  11. Understanding the paradox of control and freedom of consumption under digital capitalism with Stafford Beer's cybernetic theory By Hannah Bensussan
  12. Gold Rush vs. War: Keynes and the Economics of Digging Holes By Michele Bee; Raphaël Fèvre
  13. Revolutionary Contagion By Jha, Saumitra; Wilkinson, Steven
  14. The Myth of the Middle Class Squeeze: Employment and Income by Class in Six Western Countries, 1980-2020 By Jad Moawad; Daniel Oesch
  15. Inertia of peasant farms By Rozinskaya Natalia; Chaplygina Irina; Sorokin Alexander
  16. Study on the tea market in India By Adit Vinod Nair; Adarsh Damani; Devansh Khandelwal; Harshita Sachdev; Sreayans Jain
  17. Memories about “the Hard 1990s” as a Resource for Adaptation to the New Turbulence: The Analysis of the Russian Media By Olga Yu. Malinova
  18. Academic Migration and Academic Networks: Evidence from Scholarly Big Data and the Iron Curtain By Donia Kamel; Laura Pollacci
  19. A representation of Keynes's long-term expectation in financial markets By Marcello Basili; Alain Chateauneuf; Giuliano Antonio; Giuseppe Scianna
  20. Perú: Consolidación Fiscal 1980-2020 y Retos a la Fecha – Una Aproximación By Gonzalo Pastor
  21. Economic Integration and the Transmission of Democracy By Marco Tabellini; Giacomo Magistretti; Giacomo Magistretti
  22. Efficient OCR for Building a Diverse Digital History By Jacob Carlson; Tom Bryan; Melissa Dell
  23. Technological Shocks and Stock Market Volatility Over a Century: A GARCH-MIDAS Approach By Afees A. Salisu; Riza Demirer; Rangan Gupta

  1. By: Alexander M. Danzer; Natalia Danzer; Carsten Feuerbaum
    Abstract: We provide quantitative evidence on the relationship between military spending and innovation in the 19th century. Combining innovation data from world fairs and historical military data across Europe, we show that national military spending is associated with national innovation towards war logistics such as food processing, but less towards war technology such as guns. This pattern reflects differences in the historical markets for war supplies. European patent data of 1990-2015 suggest a long-term correlation between historical and contemporaneous innovation patterns.
    Keywords: military spending, innovation, war logistics, food processing, military supply, 19th century
    JEL: H56 O31 O14 N43
    Date: 2023
  2. By: Klein, Alexander (University of Kent); Crafts, Nicholas (University of Sussex)
    Abstract: This paper examines long-run unconditional convergence of labour productivity in manufacturing across 48 contiguous U.S. states. For that purpose, we construct a detailed panel data set of stateindustry pairs with over 120 industries covering the period 1880-2007. We find that unconditional convergence in manufacturing productivity was pervasive and rapid – 7.6% per year in 1880-2007 – and that manufacturing accounts for most of the unconditional convergence contribution to overall productivity growth over the long run: 61% in 1880-1940 and 91% in 1958-2007. We also examined broad U.S. regions and found that in the South the contribution of unconditional 𝛽-convergence in manufacturing to aggregate productivity growth before World War II was weak not because of a slower convergence rate but a much smaller manufacturing sector.
    Keywords: convergence ; economic growth ; U.S. economic history ; manufacturing belt JEL codes: O47 ; N11 ; N12 ; R11
    Date: 2023
  3. By: Bindler, Anna (University of Gothenburg); Hjalmarsson, Randi (University of Gothenburg); Machin, Stephen (London School of Economics); Rubio-Ramos, Melissa (University of Cologne)
    Abstract: Using data on 100 years of 19th century criminal trials at London's Old Bailey, this paper offers clear evidence of disparate treatment of Irish-named defendants and victims by English juries. We measure surname Irishness and Englishness using place of birth in the 1881 census. Irish-named defendants are 11% less likely to plea, 3% more likely to be convicted by the jury, and 16% less likely to receive a jury recommendation for mercy. These disparities are: (i) largest for violent crimes and for defendants with more distinctive Irish surnames; (ii) robust to case characteristic controls and proxies for signals associated with Irish surnames (social class, Irish county of origin, criminality); (iii) particularly visible for Irish defendants in cases with English victims; and (iv) spill-over onto English-named defendants with Irish codefendants. Disparate treatment is first visible in the 1830s, after which it grows, then persists through to the end of the century. In particular, the gap in jury conviction rates became larger during the twenty years after the Irish Potato Famine-induced migration to London. We do not find evidence, however, that the first bombing campaign of the Irish Republican Brotherhood (in 1867 and the 1880s) further exacerbated these disparities.
    Keywords: Irish, crime, criminal law, discrimination, economic history
    JEL: K42 K14 J15 N33 N93
    Date: 2023–04
  4. By: Naomi R. Lamoreaux; Jean-Laurent Rosenthal
    Abstract: From Elihu Thomson and Herbert Dow in the late nineteenth century to Steve Jobs a hundred years later, many entrepreneurs have been stymied by their investors. In this paper, we use a simple model to explore how outcomes might have been different if entrepreneurs, instead of the investors, had control of their firms. We also explore the importance of legal rules that enable entrepreneurs to lock in control even when, under one-share-one-vote governance, power would rest with their investors. We find that entrepreneurs take advantage of such rules when the cost of capital is low, as in Britain in the early twentieth century or the US in the early twenty-first century. We also find that firms controlled by entrepreneurs can take on more difficult projects, and thus push the technological frontier out more rapidly, than firms controlled by investors. Such firms are also superior in this way to serial startups.
    JEL: G3 K2 N2 N8 O39
    Date: 2023–04
  5. By: Kabeer Bora
    Abstract: Economic historian Robert Allen observed that during the Industrial Revolution, the British working class experienced a period of stagnant real wages. This has led many historians to investigate changes in the diet of the working class during that time. While there has been a focus on the entire food basket, this paper concentrates on the consumption of tea, which was entirely imported. I seek to explore why demand for tea increased during the Industrial Revolution by examining the effect of working hours on tea imports between 1760 and 1834. I aim to identify the determinants of tea demand and while underlining the crucial role that increasing working hours played in surplus extraction. The Industrial Revolution was characterized by long working hours, and the declining consumption per capita of so-called luxury items, such as tea, was actually due to their use as stimulants. To examine the relationship between working hours and tea imports, I employ a Dynamic OLS (DOLS) methodology, which demonstrates that tea imports responded positively to increasing working hours. This finding is corroborated by another method, the Fully Modified OLS (FM-OLS). I also propose new methods for calculating hours worked and tea imports in the process.
    Keywords: Tea, Working hours, Time Series, Trade History, Industrial Revolution JEL Classification: N33, J22, I15, N73, F14
    Date: 2023
  6. By: Jonung, Lars (Department of Economics, Lund University)
    Abstract: After World War II and prior to the financial deregulation of the 1980s, monetary policy in Sweden as well as in other western European countries rested chiefly on a system of far- reaching non-market-oriented controls of credit flows and interest rates. How was monetary policy conducted in such an environment of financial repression, where the central bank was unable to rely on traditional monetary policy instruments working on "free" and "unregulated" money and capital markets?<p> This study provides an answer from the Swedish experience. It is based on a unique set of confidential minutes from about 160 monthly meetings between the Riksbank and the commercial banks during the years 1956-73. These minutes, written during or directly after the meetings, have not been available to scholars before. Most likely, a similar archive material does not exist for any other country.<p> The examination of the minutes demonstrates that monetary policy was framed in a process involving threats and arguments in a small and closed club involving the central bank and the chief executives of the commercial banks. According to a joke assigned to Erik Lundberg “open market operations were replaced by open mouth operations” - albeit the dialogue was kept within the club.<p> When Swedish financial markets were deregulated in the 1980s, the standard tools of monetary policy rapidly replaced the meetings between the central bank and the commercial banks. Today, the Riksbank communicates in an open way to all financial market participants, instead of turning to a small set of commercial bankers in meetings closed to outsiders.
    Keywords: Credit controls; interes rate controls; exchange controls; financial repression; liquidity ratios; the Riksbank; Sweden
    JEL: B22 E42 E50 E58 E65 G21 N14
    Date: 2023–04–24
  7. By: Jeff Biddle; Elior Cohen
    Abstract: An era of mass immigration into the United States ended with the onset of World War I in Europe, followed by the passage of restrictive immigration laws in 1921 and 1924. We analyze various sources of wage data collected in the 1910-1929 period to explore the impact of this significant disruption of the flow of immigration on the wages of unskilled labor. Our approach to identification entails examining differences in wages across local labor markets and industries differentially exposed to the disruptions in immigration due to different ethnic compositions of their immigrant populations in the pre-war era. We find evidence strongly suggesting that during the 1920s, industries and regions more affected by the disruptions in immigration experienced larger reductions in flows of immigrants that resulted in increased wages of unskilled labor.
    Keywords: immigration; wages; labor force
    JEL: J3 J61 N31 N32
    Date: 2022–09–27
  8. By: Braun, Sebastian Till (University of Bayreuth); Stuhler, Jan (Universidad Carlos III de Madrid)
    Abstract: With 70 million dead, World War II remains the most devastating conflict in history. Of the survivors, millions were displaced, returned maimed from the battlefield, or spent years in captivity. We examine the impact of such wartime experiences on labor market careers and show that they often become apparent only at certain life stages. While war injuries reduced employment in old age, former prisoners of war postponed their retirement. Many displaced workers, particularly women, never returned to employment. These responses are in line with standard life-cycle theory and thus likely extend to other conflicts.
    Keywords: World War II, labor market careers, war injuries, prisoners of war, displacement, life-cycle models
    JEL: J24 J26 N34
    Date: 2023–03
  9. By: Oleg V. Pavlov; Jason M. Sardell
    Abstract: This chapter develops a feedback economic model that explains the rise of the Sicilian mafia in the 19th century. Grounded in economic theory, the model incorporates causal relationships between the mafia activities, predation, law enforcement, and the profitability of local businesses. Using computational experiments with the model, we explore how different factors and feedback effects impact the mafia activity levels. The model explains important historical observations such as the emergence of the mafia in wealthier regions and its absence in the poorer districts despite the greater levels of banditry.
    Date: 2023–04
  10. By: Grigoriev Leonid (National Research University Higher School of Economics; Department of Economics, Lomonosov Moscow State University)
    Abstract: The activity of Peter the Great on large-scale reforms in practical terms began with the war, coincided with the war and in a number of key issues was determined by the need to wage war, arming and supplying the army, restructuring management. Starting with the moderate goal of opening a "window to Europe", after 1714 administrative reforms became broader and more comprehensive. But by this time, critical steps to move away from the "boyar" management, the creation of an army on a modern basis and the development of industry on the basis of serfdom had already been taken made. The logic of reforms was determined not only by the desire for Europe and not by the teleology of empire creation. We are talking about the pragmatic need to use the window of opportunity to get out of the "ring track" of a vast forest power compressed by three imperial (regardless of titles) neighbors of other faiths - Turkey, Poland and Sweden. All three had goals in relation to Russia within the framework of their own political, economic and territorial interests. Progress and needs The Northern War largely determined the nature of the reforms, and the success of the war led to towards the formation of an empire. The results of the reforms and the war gave the country a chance for development, although a large-scale transition to more mature European socio-economic institutions in these short terms and under conditions of war was not realized and could not be realized.
    Keywords: Peter the Great, domestic policy, foreign policy, war, international trade
    JEL: B20 B22 B27 B31
    Date: 2022–11
  11. By: Hannah Bensussan (CEPN - Centre d'Economie de l'Université Paris Nord - LABEX ICCA - UP13 - Université Paris 13 - Université Sorbonne Nouvelle - Paris 3 - CNRS - Centre National de la Recherche Scientifique - UPCité - Université Paris Cité - Université Sorbonne Paris Nord - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord)
    Abstract: Studies on the digitalization of markets and economic relations provide contrasting statements on its impact on consumers: it seems to have enhanced both control and freedom of these actors. This paper proposes to understand this paradox through the lens of Stafford Beer's cybernetic theory. We read the literature on digitalization and consumption at the light of Beer's concepts of regulated variety, regulatory variety and recursion, three concepts at the source of Beer's understanding of control and freedom. These concepts, we argue, allow to show the conditioned rise of consumers' freedom to the purpose of control in capitalist orders, i.e., commodity circulation and capital accumulation.
    Keywords: Control, freedom, consumption, digital capitalism
    Date: 2023–03–29
  12. By: Michele Bee (CEDEPLAR, Universidade Federal de Minas Gerais, Brazil); Raphaël Fèvre (Université Côte d'Azur, CNRS, GREDEG, France)
    Abstract: This paper aims to fully exploit the heuristic virtues of Keynes' famous ‘old bottles' story, deploying a multi-layered argument and drawing out its broadest implications. We show that with this story Keynes was making a very serious point about anti-crisis policies: the need for authorities to stimulate animal spirits by relying on people's natural impulse to action. Rather than taking the place of entrepreneurs and paying people to dig holes, Keynes seems to be arguing that public authorities should put entrepreneurs in a situation where they are so enthusiastic that they go into debt to dig holes, just like during a gold rush. At the same time, it is a question of restoring the banks' willingness to lend for these over-optimistic projects in a period of depression. This article explores the conditions that make public intervention as effective as possible through the enthusiasm and individual initiative that can be generated by an artificial gold rush. Such intervention therefore can be as minimal as possible, without having to resort to the opposite authoritarian solution of war. Since the gold rush builds cities and wars destroy them, Keynes spent considerable energy convincing his contemporaries that liberal-democratic countries would have to take the former path if they wanted to avoid the latter.
    Keywords: Slump, Keynesian Multiplier, Animal Spirits, Artificial Gold-Rush, War
    Date: 2022–08
  13. By: Jha, Saumitra (Stanford U); Wilkinson, Steven (Yale U)
    Abstract: We compare political mobilization and support for democratic values during the French Revolution among the home bailliages and among individual members of French regiments sent with the Comte de Rochambeau to fight alongside American revolu- tionaries (1781-83), to others also assigned there who failed to arrive due to logistical failures and British blockade. We provide evidence for revolutionary contagion: bail- liages with 10% more Rochambeau veterans were 6.4% more likely to submit grievances to the King that were “Most Strongly Democratic†in 1789. They mobilize political clubs earlier, are more likely to engage in revolt and as individuals were more likely to show loyalty to moderate democratic revolutionary reforms both within the army and the National Assembly. Other veterans mobilize too, but less so and not for demo- cratic principles. Similarly, exposure to Enlightenment ideas has limited effects absent American veterans. We interpret these results as reflecting the complementarity be- tween exposure to democratic ideas and organizational skills of veterans in generating contagion between two of the world’s great revolutions.
    Date: 2023–03
  14. By: Jad Moawad (University of Lausanne); Daniel Oesch (University of Lausanne)
    Abstract: The public debate depicts the middle class as the victim of employment polarization and income stagnation. This narrative of a squeezed middle class suggests that people above and below fared better in terms of job and income growth. However, this narrative ignores basic insights from class theory and lacks empirical evidence. Based on the Luxembourg Income Study, we trace the evolution of employment and income by class for six large Western countries – France, Germany, Poland, Spain, the UK and US –, 1980-2020. Over this period, employment of the upper-middle and middle class strongly expanded, while the skilled and low-skilled working class shrank everywhere. Working-class households also made consistently smaller income gains than middle-class households in all countries except Poland. Real labor income of the working class declined in Germany, stagnated in the US and grew by less than one percent annually in France and the UK. A cohort analysis of wage growth shows that the promise of doing better than one’s parents and grandparents held for middle- class households. However, this same promise vanished for the working class – most evident in Germany and the US. The great economic loser of the last decades was not the middle, but the working class.
    Keywords: Social classes; Middle class; Employment structure; Working class
    Date: 2023–04
  15. By: Rozinskaya Natalia (Department of Economics, Lomonosov Moscow State University); Chaplygina Irina (Department of Economics, Lomonosov Moscow State University); Sorokin Alexander (Department of Economics, Lomonosov Moscow State University)
    Abstract: The article is devoted to the analysis of one of the features of the behavior of peasant farms that distinguishes them from the behavior of firms, namely the tendency to reduce production volumes in response to the improvement of market conditions (inertness, in the terminology of N.D.Kondratiev). The authors turn to theoretical explanations of this trend, in particular in the works of A.Chayanov, and then attempt to test the reliability of the identified feature on Russian data from the beginning of the XX century. Having analyzed the dynamics of the amount of land plowed by peasants in response to the dynamics of prices in various provinces of Russia, the authors find a significant negative correlation. Comparing with similar results for landlords, the authors come to conclusion that negative correlation is specific only to peasant farms, thereby proving the hypothesis of inertness.
    Keywords: Peasant economy, the inertia of the household, price elasticity of supply, cultivated areas, A.V. Chayanov, Russian empire, XIX-XX century
    JEL: Q10 Q12
    Date: 2023–03
  16. By: Adit Vinod Nair; Adarsh Damani; Devansh Khandelwal; Harshita Sachdev; Sreayans Jain
    Abstract: India's tea business has a long history and plays a significant role in the economics of the nation. India is the world's second-largest producer of tea, with Assam and Darjeeling being the most well-known tea-growing regions. Since the British introduced tea cultivation to India in the 1820s, the nation has produced tea. Millions of people are employed in the tea sector today, and it contributes significantly to the Indian economy in terms of revenue. The production of tea has changed significantly in India over the years, moving more and more towards organic and sustainable practices. The industry has also had to deal with difficulties like competition from other nations that produce tea, varying tea prices, and labor-related problems. Despite these obstacles, the Indian tea business is still growing and produces a wide variety of teas, such as black tea, green tea, and chai tea. Additionally, the sector encourages travel through "tea tourism, " which allows tourists to see how tea is made and discover its origins in India. Overall, India's tea business continues to play a significant role in its history, culture, and economy.
    Date: 2023–04
  17. By: Olga Yu. Malinova (National Research University Higher School of Economics)
    Abstract: The paper contributes to better understanding of public perceptions of the new reality emerging after the entry of Russia’s troops in Ukraine on February 24, 2022 and the unprecedented retaliatory sanctions from the West. It focuses on how the memories about the traumatic experience of the 1990s were activated to manage the new turbulence and uncertainty. Based on publications of the printed and electronic media in February-August, 2022, through the qualitative content analysis conducted in the MAXQDA app, the paper reveals typical patterns of framing the connections between “then” and “now”. The author argues that memories turned to be an essential symbolic resource for making sense of the new reality, as soon as the latter displayed many analogies with the past traumatic experience. It finds that the activation of memories about the 1990s was largely based on the established frames of remembrance that became re-interpreted in the new context. In particular, the past experience of “hard times” that had been overcome provides confidence that the current situation is manageable. At the same time, a dangerous proliferation of a xenophobic discourse proposing then eradication of a liberal “fifth column” was detected.
    Keywords: Collective memory, frames of remembrance, the hard 1990s, public discourse
    JEL: Z
    Date: 2023
  18. By: Donia Kamel; Laura Pollacci
    Abstract: Iron Curtain and Big Data are two words usually used to denote completely two different eras. Yet, the context the former offers and the rich data source the latter provides, enable the causal identification of the effect of networks on migration. Academics in countries behind the Iron Curtain were strongly isolated from the rest of the world. This context poses the question of the importance of academic networks for migration post the fall of the Berlin Wall and Iron Curtain. Using Microsoft Academic Knowledge Graph, a scholarly big data source, mapping of academics’ networks is possible and information about the size and quality of their co-authorships, by location is achieved. Focusing on academics from Eastern Europe (henceforth EE) from 1980-1988 and their academic networks (1980-1988), We investigate the effect of academic network characteristics, by location, on the probability to migrate post the fall of the Berlin Wall in 1989 and up to 2003, marking the year many EE countries held referendums or signed treaties to join the EU. The unique context ensures that there was no anticipation of the fall of the Eastern Bloc and together with the data that offers unique rich information, identification is achieved. Approximately 30k academics from EE were identified, from which 3% were migrants. The results could be explained by two channels, the cost and signalling channel. The cost channel is how the network characteristic reduces or increases the cost of migration and thus acting as a facilitator or a de-facilitator of migration. The signal channel on the other hand in which the network characteristic serves as a signal for the academic himself and his quality and his potential contribution and addition to the new host institution, thus also serving as a facilitator or a de-facilitator of migration. We find that mostly network size and quality results could be explained by the cost channel and signalling channel, respectively. Size of the network tends to be more important than the quality, which is a context-specific result. We find heterogeneous effects by fields of study that align with previous lines of research. Heterogeneous effects are explained by two things: threat of attention and arrest from KGB and the role of reputation, language, and network barriers.
    Keywords: networks, migration, academic networks, Big Data, brain drain, Iron Curtain, Eastern Europe
    JEL: C55 D85 F50 I20 I23 J24 N34 N44 O15
    Date: 2023
  19. By: Marcello Basili (DEPS - Dipartimento di Economia Politica e Statistica - UNISI - Università degli Studi di Siena = University of Siena); Alain Chateauneuf (UP1 - Université Paris 1 Panthéon-Sorbonne); Giuliano Antonio; Giuseppe Scianna
    Abstract: This paper advances an intuitive representation of Keynes's notion of long-term expectation. We introduce the epsilon-contamination approach and represent the conventional judgment by the Steiner point of agents' common probability set. We anticipate a change in conventional judgment by updating the Steiner point.
    Keywords: uncertainty, multiple priors. JEL classification: D81, Keynes long-term expectation epsilon contamination uncertainty multiple priors. JEL classification: D81, Keynes, long-term expectation, epsilon contamination
    Date: 2023–03–28
  20. By: Gonzalo Pastor
    Abstract: Esta nota narra la consolidación fiscal ocurrida en los últimos 40 años, las evoluciones en los conceptos de déficit fiscal monitoreados en el análisis fiscal, y el impacto de la condicionalidad del Fondo Monetario Internacional (FMI) inmersa en los sucesivos programas financieros subscritos entre Perú y el FMI sobre la evolución de los principales agregados fiscales. La nota también elabora en los logros y retos de gestión pública a la fecha.
    Date: 2022–12
  21. By: Marco Tabellini (Harvard Business School, NBER, CEPR, and IZA); Giacomo Magistretti (International Monetary Fund); Giacomo Magistretti (IMF)
    Abstract: In this paper, we study the effects of economic integration with democracies on individuals’ democratic values and on countries’ institutions. We combine survey data with country level measures of democracy from 1960 to 2015, and exploit improvements in air, relative to sea, transportation to derive a time-varying instrument for trade. We find that economic integration with democracies increases both citizens’ support for democracy and countries’ democracy scores. Instead, trade with non-democracies has no impact on either attitudes or institutions. The effects of trade with democracies are stronger when partners have a longer history of democracy, grow faster, spend more on public goods, and are culturally closer. They are also driven by imports, rather than exports, and by integration with partners that export higher quality goods and that account for a larger share of a country’s trade in institutionally intensive, cultural, and consumer goods as well as in goods that involve more face-to-face interactions and entail higher levels of bilateral trust. These patterns are consistent with trade in goods favoring the transmission of democracy by signaling the (actual or perceived) desirability of the latter. We examine alternative mechanisms, and conclude that none of them can, alone, explain our findings.
    Keywords: Democracy, political preferences, institutions, economic integration
    JEL: F14 F15 P16
    Date: 2023–01
  22. By: Jacob Carlson; Tom Bryan; Melissa Dell
    Abstract: Thousands of users consult digital archives daily, but the information they can access is unrepresentative of the diversity of documentary history. The sequence-to-sequence architecture typically used for optical character recognition (OCR) - which jointly learns a vision and language model - is poorly extensible to low-resource document collections, as learning a language-vision model requires extensive labeled sequences and compute. This study models OCR as a character level image retrieval problem, using a contrastively trained vision encoder. Because the model only learns characters' visual features, it is more sample efficient and extensible than existing architectures, enabling accurate OCR in settings where existing solutions fail. Crucially, the model opens new avenues for community engagement in making digital history more representative of documentary history.
    Date: 2023–04
  23. By: Afees A. Salisu (Centre for Econometrics & Applied Research, Ibadan, Nigeria; Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa); Riza Demirer (Department of Economics and Finance, Southern Illinois University Edwardsville, Edwardsville, IL 62026-1102, USA); Rangan Gupta (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa)
    Abstract: This paper provides a novel perspective to the innovation-stock market nexus by examining the predictive relationship between technological shocks and stock market volatility using data over a period of more than 140 years. Utilizing annual patent data for the U.S. and a large set of economies to create proxies for local and global technological shocks and a mixed-sampling data (MIDAS) framework, we present robust evidence that technological shocks capture significant predictive information regarding future realizations of stock market volatility, both in- and out-of-sample and at both the short and long forecast horizons. Further economic analysis shows that investment portfolios created by the volatility forecasts obtained from the forecasting models that incorporate technological shocks as predictors in volatility models experience significantly lower return volatility in the out-of-sample horizons, which in turn helps to improve the risk-return profile of those portfolios. Our findings present a novel take on the nexus between technological innovations and stock market dynamics and paves the way for several interesting avenues for future research regarding the role of technological innovations on asset pricing tests and portfolio models.
    Keywords: Patents, Technology shocks, Stock market volatility, Forecasting
    JEL: C32 C53 E37 G15 O33
    Date: 2023–04

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