nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2023‒05‒22
34 papers chosen by

  1. Property, wealth, and social change: Piketty as a social science engineer By Savage, Mike; Waitkus, Nora
  2. Wage Inequality in American Manufacturing, 1820-1940: New Evidence By Jeremy Atack; Robert A. Margo; Paul Rhode
  3. Wars, Education and Economic Development By Jakob B. Madsen; Miethy Zaman
  4. The Occupational Attainment of American Jewish Men in the Mid-19th Century By Chiswick, Barry R.; Robinson, RaeAnn Halenda
  5. A Review on Genesis, Growth and Development of Bengal Artisanal Silk Industry in India By Roy, Chandan
  6. Was Smith a Stage Theorist? A response to Ahiakpor By Paganelli, Maria Pia
  7. Political Conflict and Economic Growth in Post-Independence Venezuela By Kronick, Dorothy; Rodriguez, Francisco
  8. Subjective Well-being in Spain's Decline By Álvarez Nogal, Carlos; Prados de la Escosura, Leandro
  9. The Creation and Diffusion of Knowledge: Evidence from the Jet Age By Stefan Pauly; Fernando Stipanicic
  10. A Model of the Gold Standard By Jesús Fernández-Villaverde; Daniel R. Sanches
  11. Tracing Sustainability in the Long Run: Genuine Savings Estimates 1850 - 2018 By Eoin McLaughlin; Cristián Ducoing; Les Oxley
  12. The Eurozone's Achilles heel: Reassessing Italy's long decline in the context of European integration and globalization By Dario Guarascio; Philipp Heimberger; Francesco Zezza
  13. A Comment on Maria Pia Paganelli’s Mistaken Treatment of Adam Smith’s “Four Stages” Theory of Economic Development By Ahiakpor, James C.W.
  14. Imperial Politics, Open Markets and Private Ordering: The Global Grain Trade (1875-1914) By Jérôme Sgard
  15. Imperial Politics, Open Markets and Private Ordering: The Global Grain Trade (1875-1914) By Jérôme Sgard
  16. The Longevity Benefits of Homeownership By Breen, Casey
  17. The Unpredictability of Individual-Level Longevity By Breen, Casey; Seltzer, Nathan
  18. Du choc géopolitique à un tournant géoéconomique. Les intérêts économiques français et l’indépendance de l’Algérie By Hubert BONIN
  19. Income inequality, top shares of income and social classes in the 21st century By Luca Giangregorio; Davide Villani
  20. The Effect of Local Economic Shocks on Local and National Elections By Juan Herreño; Matias Morales; Mathieu Pedemonte
  21. Early Warning System for Currency Crises using Long Short-Term Memory and Gated Recurrent Unit Neural Networks By Sylvain Barthélémy; Fabien Rondeau; Virginie Gautier
  22. Social inequities in neighborhood health amenities over time in the Wasatch Front Region of Utah: Historical inequities, population selection, or differential investment? By Curtis, David Stuart
  23. Review of Jon D. Erickson, The Progress Illusion: Reclaiming Our Future from the Fairytale of Economics, Washington, DC, Island Press, 2022, xx + 252 pp., hb, ISBN 978-1-64-283252-5 By Alexandru Pătruți
  24. Compte rendu de "The Economic Weapon. The Rise of Sanctions as a Tool of Modern War" By Jérôme Sgard
  25. The Institution of American Slavery, Current-Day Preference to Repeal the Affordable Care Act, and Efficacy of the Reform By Vinish Shrestha
  26. Does Monetary Policy Matter? The Narrative Approach after 35 Years By Christina D. Romer; David H. Romer
  27. A snapshot of Central Bank (two year) forecasting: a mixed picture By Goodhart, C. A. E.; Pradhan, Manoj
  28. How Far Goods Travel: Global Transport and Supply Chains from 1965-2020 By Sharat Ganapati; Woan Foong Wong
  29. Inventing Conditionality, Exploring Its Politics (1946-1958) By Jérôme Sgard
  30. The Empire Project: Trade Policy in Interwar Canada By Lampe , Markus; Hjortshøj O’Rourke , Kevin; Reiter , Lorenz; Yotov, Yoto
  31. Financial Literacy, Human Capital and Long-Run Economic Growth By Alberto Bucci; Riccardo Calcagno; Simone Marsiglio; Tiago Miguel Guterres Neves Sequeira
  32. L’arbitrage et la construction d’un espace marchand global By Claire Lemercier; Jérôme Sgard
  33. A Note of Caution on the Relation between Money Growth and Inflation By Berger, Helge; Karlsson, Sune; Österholm, Pär
  34. THE SICILIAN POPULATION IN 1277: NEW ESTIMATES By ruggeri, giuseppe

  1. By: Savage, Mike; Waitkus, Nora
    Abstract: This paper applauds the vision and originality of Piketty's Capital and Ideology. We draw attention to the distinctive methodological perspective which he adopts, which we liken to call “social science engineering.” This allows a problem oriented perspective on long-term global social change which sidesteps siloed disciplinary debates in social science and history about the meaning of modernity, the rise of capitalism, the formation of social groups, and the primacy of nations. We bring out how his theory of property permits him to take forward his overarching insight that economic growth leads to wealth accumulation. This, therefore, challenges long standing sociological perspectives by insisting that modernity is a conservative, rather than a revolutionary and transformative process. We build on this essential contribution by noting some areas where his work can push forward even further, notably that his focus on shifting relativities obscures qualitative historical changes, and more particularly means his analysis of the 20th century is not as provocative as that of the 19th century.
    Keywords: inequality; Matthew effect; Piketty; property & wealth
    JEL: J1
    Date: 2022–03–25
  2. By: Jeremy Atack; Robert A. Margo; Paul Rhode
    Abstract: The consensus view among economic historians is that wage inequality in American manufacturing followed an inverted-U path from the early nineteenth century until just before World War Two. The previous literature, however, has been unable to fully document this path over time, or fully assess the role of explanatory factors such as changes in firm organization and technology. We provide fresh evidence that allow us to better document the inverted-U and its causes. In the first part of the paper, we use the U.S. Department of Labor’s 1899 “Hand and Machine Labor” study to argue that wage inequality within manufacturing establishments rose over the nineteenth century, primarily because of increasing division of labor In the second part, we use data for Massachusetts from state reports to construct a new time series on wage inequality among production workers, which declined from the early 1890s to the late 1930s, mainly because of compression in the left tail of the distribution. Analysis of industry panel data suggest that electrification was the main factor behind the compression.
    JEL: N31 N32 N62
    Date: 2023–04
  3. By: Jakob B. Madsen; Miethy Zaman
    Abstract: In this paper, we hypothesize that the prolonged wars in Latin America during most of the 19th century hindered human capital development and delayed economic progress well into the 20th century. Collecting novel data for the seven largest Latin American economies over the period 1820-2016, we show that the extraordinarily large share of military expenditure in total spending crowded out investment in education and R&D, which in turn had persistent effects on economic development.
    Keywords: military campaigns, education, economic development, crowding out, state capacity, Latin America
    JEL: I20 N54 O11 O30
    Date: 2023–05
  4. By: Chiswick, Barry R. (George Washington University); Robinson, RaeAnn Halenda (George Washington University)
    Abstract: This paper is concerned with analyzing the occupational status of American Jewish men compared to other free men in the mid-19th century to help fill a gap in the literature. It does this by using the 1/100 microdata sample from the 1850 Census of Population, the first census to ask occupation. Two independent lists of surnames are used to identify men with a higher probability of being Jewish. The men identified as Jews had a higher probability of being professionals, managers, and craft workers, and were less likely to be in farm occupations or in operative jobs. Using the Duncan Socioeconomic Index (SEI), the Jewish men have a higher SEI overall. In the multiple regression analysis, it is found that among Jewish and other free men occupational status increases with age (up to about age 44 for all men), literacy, being married, being native born, living in the South, and living in an urban area. Controlling for a set of these variables, Jews have a significantly higher SEI, which is the equivalent of about half the size of the effect of being literate. This higher occupational status is consistent with patterns found elsewhere for American Jews throughout the 20th century.
    Keywords: Jews, occupational status, Duncan Socioeconomic Index, 1850 Census of Population, Antebellum America, labor market analysis, human capital
    JEL: N31 J62 J15
    Date: 2023–04
  5. By: Roy, Chandan
    Abstract: This paper explores how the silk production in India started flourishing from mid of the seventeenth century when the demand for cheaper Bengal silk began to rise in European market. Initially Dutch merchants were collecting the silk from domestic market for exporting it to Europe and later English East India Company (EEIC) took over the control of silk trade spreading their tentacles in different parts of Bengal. In order to improve the quality, EEIC introduced Italian technology of reeling in Bengal in 1769, though Bengal sericulture was unable to adapt the technology. Bengal economy was going through several natural calamities and domestic disturbances. From 1813 the company started selling its filatures. The economic power of dadani merchant, money-lenders started growing from this period and they formed a new middle class while the situation of artisan and farmer classes deteriorated. The condition of native artisans of Bengal further worsened under the rule of British Monarch as the Industrial Revolution in West set in. Being potential competitor of Machester Silk, Bengal silk faced serious crisis and eventually Bengal silk industries were transformed into suppliers of raw materials, which was driven by the national interest interests of the British Monarch.
    Keywords: Artisanal Silk, Piedmontese Technology, East India Company, Bengal Silk
    JEL: N00 N55 N95
    Date: 2022–01
  6. By: Paganelli, Maria Pia
    Abstract: (Letter to the editor). James Ahiakpor claims I am incorrect in my reading of Smith when I suggest that Smith may not endorse, or may even reject, a four stages of development model, given his absence of historical example of any country that developed following the four stages, but rather his descriptions of different ages looks more likely like a taxonomy to describe different types of societies. I very much appreciate the time and energy Ahiakpor put on my work and I have no qualm about his reading of my paper. Since I was asked to reply to his detailed comments, I will. But only in a general, methodological, way.
    Date: 2023–04–20
  7. By: Kronick, Dorothy; Rodriguez, Francisco
    Abstract: Venezuela has suffered three economic catastrophes since independence: one each in the nineteenth, twentieth, and twenty-first centuries. Prominent explanations for this trilogy point to the interaction of class conflict and resource dependence. We turn attention to intra-class conflict, arguing that the most destructive policy choices stemmed not from the rich defending themselves against the masses but rather from pitched battles among elites. Others posit that Venezuelan political institutions failed to sustain growth because they were insufficiently inclusive; we suggest in addition that they inadequately mediated intra-elite conflict.
    Keywords: Growth, conflict, Venezuela, economic history
    JEL: N16 O43 O54
    Date: 2023–02–23
  8. By: Álvarez Nogal, Carlos; Prados de la Escosura, Leandro
    Abstract: Spain experienced economic decline from the 1570s to 1650, recovering gradually thereafter and only reaching its early 1570s per capita income in the 1820s. How did economic decline impact on people's perception of well-being and inequality? We provide an answer based on an unexplored source, the Bulls of the Crusade, an alms that, after 1574, was annually collected by the Spanish Monarchy in its territories, and that, to some material benefits, added spiritual benefits: plenary indulgencies that erased the penance for guilt after sinning. An inexpensive but fixed price alms was massively bought by those aged 12 and above. The number of bulls sold relative to the relevant population provides a measure of spiritual comfort and, hence, of subjectivewell-being. A subjective inequality measure, the ratio of the 8 Reales bulls sold, intended for wealthy and high social status people, to the 2 Reales bulls sold, intended for the common people, is also estimated. Our results suggest that subjective wellbeing deteriorated during the late sixteenth and early seventeenth century improving during its last third, while subjective inequality increased from 1600-1640 to fall in the third quarter of the century. Thus, improvements in subjective well-being were accompanied by a decline in subjective inequality.
    Keywords: Subjective Well-Being; Subjective Inequality; Spain; Economic Decline
    JEL: H27 I31 N33
    Date: 2023–05–08
  9. By: Stefan Pauly (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Fernando Stipanicic (UC Berkeley - University of California [Berkeley] - UC - University of California)
    Abstract: Click here for the latest version This paper provides new causal evidence of the impact of air travel time on the creation and diffusion of knowledge. We exploit the beginning of the Jet Age as a quasi-natural experiment. We digitize airlines' historical flight schedules and construct a novel data set of the flight network in the United States. Between 1951 and 1966, travel time between locations more than 2, 000 km apart decreased on average by 41%. The reduction in travel time explains 33% of the increase in knowledge diffusion as measured by patent citations. The increase in knowledge diffusion further caused an increase in the creation of new knowledge. The results provide evidence that jet airplanes led to innovation convergence across locations and contributed to the shift in innovation activity towards the South and the West of the United States.
    Date: 2022–10–21
  10. By: Jesús Fernández-Villaverde; Daniel R. Sanches
    Abstract: The gold standard emerged as the international monetary system by the end of the 19th century. We formally study its properties in a micro-founded model and find that the scarcity of the world gold stock not only results in a suboptimal output of goods that are purchased with money but also subjects the domestic economy of a country to external shocks. The creation of inside money in the form of private credit instruments adds to the money supply, usually resulting in a Pareto improvement, but opens the door to the international transmission of banking crises. These properties of the gold standard can explain the limited adherence by peripheral countries because of the potential risks to their economies. We argue that the gold standard can be sustainable at the core but not at the periphery.
    Keywords: gold standard; specie flows; non-neutrality of money; inside money
    JEL: E42 E58 G21
    Date: 2022–09–21
  11. By: Eoin McLaughlin; Cristián Ducoing; Les Oxley
    Abstract: We introduce a new database of historical Genuine Savings (GS), an indicator of sustainable development promoted by the World Bank and widely used in contemporary economic research. GS derives from the theoretical work on wealth accounting, and addresses shortcomings in conventional metrics of economic development by incorporating broader measures of saving and investment, including human capital (education), and natural resource depletion. Its value as an indicator is determined by its ability to be used to predict future well-being. This article provides consistent historical estimates of GS since 1850 for 25 countries to enhance, complement, and contextualise the work of the World Bank and others.
    JEL: N10 N50 Q01 Q32 Q56
    Date: 2023–04
  12. By: Dario Guarascio; Philipp Heimberger; Francesco Zezza
    Abstract: This paper analyzes how Italy's decades-long decline turned the country into the Eurozone's Achilles heel, the most vulnerable spot of the common currency. We use a new structuralist framework to synthesize different (competing) supply-side and demand-side explanations. We argue that structural domestic factors that were already present in the decades after World War II ('original sins') – low-cost competition and labour fragmentation, many small firms linked to low innovation, and a deep territorial divide – interacted with the policy constraints brought about by globalization and European integration to exacerbate Italy's decline vis-Ã -vis its large Eurozone peers.
    Keywords: Italy, decline, Eurozone, crisis
    JEL: F02 F15 F45 F55
    Date: 2023–03
  13. By: Ahiakpor, James C.W.
    Abstract: Paganelli (2022) casts doubt on whether Adam Smith argues a “Four Stages” theory or a “stadial model” of socio-economic development; she dismisses the usefulness of cross-section data to evaluate Smith’s theory of the evolution of economies; and she misinterprets several texts in the Wealth of Nations. Disregarding more accurate interpreters of Smith, she invites us to inquire again into the causes of the wealth of nations since Smith, in her judgment, has failed in that effort. But Smith’s Wealth of Nations, carefully read, is an essential guide to policy formulation to promote the efficient development of economies. My comment clarifies.
    Date: 2023–04–20
  14. By: Jérôme Sgard (CERI - Centre de recherches internationales (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: From the 1870s onwards, global commodity markets were all governed by self-standing private bodies, typically controlled by elite merchants. The London Corn Trade Association thus standardized supply from across the world, turning grain into a fungible commodity; it arbitrated disputes; and it offered to traders a range of standard contracts that integrated the value chains, from the various export harbors till destination. Enforcement rested on market power and the threat of blacklisting, which were inherently extra-territorial: few merchant houses in the world could afford being expelled from the London market. On the other hand, governments, whether sovereign or colonial, played a very limited direct role in how transactions were conducted. Ultimately, however, this private trading platform worked under English law exclusively and it was upheld by both the London courts and the Bank of England. It was both global and local, and hence a full part of Britain's imperial project. It policed a global network of private commercial routes while mediating the demands for market integration and the sheer instability of the global political geography. Rule-based market power should thus be seen as a specific factor in Britain's economic supremacy, together with relative productivity levels or capital exports.
    Keywords: grain trade, market governance, imperialism, globalization, United Kingdom
    Date: 2023–04
  15. By: Jérôme Sgard (CERI - Centre de recherches internationales (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: From the 1870s onwards, global commodity markets were all governed by self-standing private bodies, typically controlled by elite merchants. The London Corn Trade Association thus standardized supply from across the world, turning grain into a fungible commodity; it arbitrated disputes; and it offered to traders a range of standard contracts that integrated the value chains, from the various export harbors till destination. Enforcement rested on market power and the threat of blacklisting, which were inherently extra-territorial: few merchant houses in the world could afford being expelled from the London market. On the other hand, governments, whether sovereign or colonial, played a very limited direct role in how transactions were conducted. Ultimately, however, this private trading platform worked under English law exclusively and it was upheld by both the London courts and the Bank of England. It was both global and local, and hence a full part of Britain's imperial project. It policed a global network of private commercial routes while mediating the demands for market integration and the sheer instability of the global political geography. Rule-based market power should thus be seen as a specific factor in Britain's economic supremacy, together with relative productivity levels or capital exports.
    Keywords: grain trade, market governance, imperialism, globalization, United Kingdom
    Date: 2023–04
  16. By: Breen, Casey
    Abstract: Owning a home has long been touted as a key component of the idealized “American Dream.” Homeownership is associated with greater wealth and better health, but the causal impact of homeownership on health remains unclear. Using linked complete-count census and Social Security mortality records, we document Black-White disparities in homeownership rates and produce the first U.S.-based estimates of the association between homeownership in early adulthood and longevity. We then use a sibling-based identification strategy to estimate the causal effect of homeownership on longevity for cohorts born in the first two decades of the 20th century. Our results indicate homeownership has a significant positive impact on longevity, which we estimate at approximately 0.4 years.
    Date: 2023–04–15
  17. By: Breen, Casey; Seltzer, Nathan (University of California, Berkeley)
    Abstract: How accurately can age of death be predicted using basic sociodemographic characteristics? We test this question using a large-scale administrative dataset combining the complete count 1940 Census with Social Security death records. We fit eight machine learning algorithms using 35 sociodemographic predictors to generate individual-level predictions of age of death for birth cohorts born at the beginning of the 20th century. We find that none of these algorithms are able to explain more than 1.5% of the variation in age of death. Our results suggest mortality is inherently unpredictable and underscore the challenges of using algorithms to predict major life outcomes.
    Date: 2023–04–08
  18. By: Hubert BONIN
    Abstract: Algeria’s political independence in 1962 opened the doors to a questioning of the domination of “imperialist” France over the Algerian economy. The local production system or cluster structured around the consumption and financing circuits of the Europeans established in the colony collapsed after te repatriation of the Pieds-Noirs. The trans-Mediterranean prduction systems, animated since the ex-Metropole, must gradually adapt to the strategies of French companies, faithful or not to their Maghreb embeddedness, and especially to the will of the new State to take control of the development of the country. The year 1962 is less a moment of rupture than an opening over ten years of transfer of ownership and decision-making centers, as socialism and nationalism of the new Power assert themselves.
    Keywords: Geo-economics, economy of independent Algeria, economic decolonization, strategy of French companies, development.
    JEL: N17 N14 N47 N87 O55
    Date: 2023
  19. By: Luca Giangregorio (Pompeu Fabra University); Davide Villani (Joint Research Center (EC))
    Abstract: This paper aims at providing new evidence about the link between personal and functional distribution and top-shares composition. We apply a novel class scheme based on two key features of contemporary capitalism i.e., individuals/households receiving multiple types of incomes, and the role of managers. The empirical application in Germany, Spain, and Italy over the period 2000-2017 reveals two main results. First, we observe a direct link between personal and functional distributions. In particular, a marginal increase in wages received by labourers would reduce inequality, whereas those received by capitalist households would increasing it. Second, we find that a significant portion of labour income at the top of the income distribution corresponds to wages received by capitalist households. We conclude that although the linear correspondence between income source and class location is more blurred today than it was 200 years ago, a class divide is still clear.
    Keywords: Income inequality, Functional income distribution, Personal income distribution, Social classes, Top shares of income
    JEL: E25
    Date: 2023–05
  20. By: Juan Herreño; Matias Morales; Mathieu Pedemonte
    Abstract: We study the reaction of voters to shifts in local economic conditions. Using the departure from the gold standard of US trading partners in 1931 and the US in 1933, we exploit heterogeneity in export destinations, creating local differences in expenditure-switching in US counties by isolating the aggregate effects of the monetary shocks using time fixed effects. We find significant changes in local voting behavior in response to both shocks, one originating abroad, and another domestically. The response to both shocks have similar magnitude. We argue that voters punished and rewarded incumbents regardless of the shocks’ origin, implying strong feedback from economic conditions to electoral outcomes.
    Keywords: US Elections; Gold Standard; Economic Voting
    JEL: D72 N42 E61
    Date: 2023–03–29
  21. By: Sylvain Barthélémy (TAC Economics, Saint-Hilaire-des-Landes, France); Fabien Rondeau (Univ Rennes, CNRS, CREM – UMR6211, F-35000 Rennes France); Virginie Gautier (TAC Economics and University of Rennes, France.)
    Abstract: Currency crises, recurrent events in economic history for developing, emerging and developed countries, generate disastrous economic consequences. This paper proposes an early warning system for currency crises using sophisticated recurrent neural networks like Long Short-Term Memory (LSTM) and Gated Recurrent Unit (GRU). These models were initially used in language processing where they performed well. Such models are increasingly used in forecasting nancial asset prices, including exchange rates, but they have not yet been applied to the prediction of currency crises. As for all recurrent neural networks, they allow to take into account non-linear interactions between variables and the inuence of past data in a dynamic form. For a set of 68 countries including developed, emerging and developing economies over the period 1995-2020, LSTM and GRU outperformed our benchmark models. LSTM and GRU correctly sent continous signals within a two-year warning window to alert 91% of the crises. For LSTM, false signals represent only 14% of the emitted signals compared to 23% for the logistic regression, making them ecient early warning systems for policymakers.
    Keywords: currency crises, early warning system, neural network, long short-term memory, gated recurrent unit
    JEL: F14 F31 F47
    Date: 2023–04
  22. By: Curtis, David Stuart (University of Utah)
    Abstract: Socially disadvantaged groups generally are more likely to reside in areas with less desirable conditions. We examined longitudinal relationships between neighborhood resident characteristics and amenities from 1990 to 2010 in a four-county urban area of Utah, U.S. Four temporal patterns of social inequities are described using mixed-effects models: historical inequities in amenities; differential selection into amenity-rich tracts; differential investment in amenities; and simultaneous twenty-year change. Results indicate historical differences by nSES, with lower status tracts having fewer green/natural amenities and higher air pollution in 1990 but also greater walkability and more food stores. Differences widened over time as nSES disproportionately increased in tracts with more green/natural amenities, less air pollution, and lower walkability in 1990, consistent with differential selection. Tract percentage non-Hispanic White did not predict historical differences, but tracts that were less walkable and had fewer healthy food stores per capita in 1990 experienced larger subsequent increases in racial/ethnic diversity. Tracts with higher percentage non-Hispanic White in 1990 had larger decreases in air pollution but also declining green/natural amenities relative to more diverse tracts. This study shows how social inequities in neighborhood amenities change over time, providing strong evidence of historical socioeconomic differences that increased due to differential selection.
    Date: 2023–04–12
  23. By: Alexandru Pătruți (Bucharest University of Economic Studies)
    Abstract: Review of Jon D. Erickson, The Progress Illusion: Reclaiming Our Future from the Fairytale of Economics
    Date: 2023–04–13
  24. By: Jérôme Sgard (CERI - Centre de recherches internationales (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Compte rendu de l'ouvrage de Nicholas Mulder, "The Economic Weapon. The Rise of Sanctions as a Tool of Modern War", New Heaven, Londres, Yale University Press, 2022. xiv-434 pages.
    Keywords: sanctions économiques, entre-deux-guerres, ordre international
    Date: 2023
  25. By: Vinish Shrestha (Department of Economics, Towson University)
    Abstract: This study investigates the relationship between the former slavery in the American South, current-day sentiments surrounding the Affordable Care Act (ACA), and its efficacy. We present three main findings. First, the preference to repeal ACA is discernably stronger among White Southerners in counties more dependent on the former slavery within the states that did not expand Medicaid. Second, Whites residing in low slavery dependent counties had higher pre-ACA uninsured rates compared to those living in counties with higher dependency on slavery. The ACA-related Medicaid expansions have closed this gap. The results for Black Southerners on this regard remain ambiguous. Third, the institution of Jim Crow that transcended slavery following the Emancipation and Reconstruction has impeded ACA's efficacy. Overall, the findings indicate that former institutions of racial oppression has affected the implementation of ACA in the American South.
    Keywords: The Patient Protection and Affordable Care Act (ACA), Slavery, Institution, ACA-related preferences, ACA efficacy, American South, Politics.
    JEL: I10 I14 D02 B15 D02
    Date: 2023–04
  26. By: Christina D. Romer; David H. Romer
    Abstract: The narrative approach to macroeconomic identification uses qualitative sources, such as newspapers or government records, to provide information that can help establish causal relationships. This paper discusses the requirements for rigorous narrative analysis using fresh research on the impact of monetary policy as the focal application. We read the historical minutes and transcripts of Federal Reserve policymaking meetings to identify significant contractionary and expansionary changes in monetary policy not taken in response to current or prospective developments in real activity for the period 1946 to 2016. We find that such monetary shocks have large and significant effects on unemployment, output, and inflation in the expected directions. Analysis of available policy records suggests that a contractionary monetary shock likely occurred in 2022. Based on the empirical estimates of the effect of previous shocks, one would expect substantial negative impacts on real GDP and inflation in 2023 and 2024.
    JEL: E31 E52 E58 E65 N12
    Date: 2023–04
  27. By: Goodhart, C. A. E.; Pradhan, Manoj
    Abstract: Central Banks normally adjust monetary policy so that inflation hits the Inflation Target (IT) within two years. Since a central bank must believe its policy stance is appropriate to achieve this goal, its inflation forecast at the two-year horizon should generally be close to target. We examine whether this has held for three main Central Banks, Bank of England, ECB and Fed. During the IT period, there have been two crisis periods, The Great Financial Crisis (GFC), and then Covid/Ukraine. We examine how the two-year forecasts differed depending on whether we were in a crisis, or more normal, period. Although over the whole IT period, up until 2022, both forecasts and outcomes were commendably close to target, we found that this was due to a sizeable forecast underestimate of the effects of policy and inherent resilience to revive inflation after each crisis hit, largely offset by an overestimate of the effect of monetary policy to restore inflation to target during more normal times. We attribute such latter overestimation to an unwarranted belief in forward looking, ‘well anchored’, expectations amongst households and firms, and to a failure to recognise the underlying disinflationary trends, especially in 2010-2019. We outline a novel means for assessing whether these latter trends were primarily demand driven, e.g. secular stagnation, or supply shocks, a labour supply surge. Finally, we examine how forecasts for the uncertainty of outcomes and relative risk (skew) to the central forecast have developed by examining the Bank of England’s fan chart, again at the two-year horizon.
    Keywords: forecasting; expectations
    JEL: D10 D21 D80 D89 E17 E31 E37 E47 E59
    Date: 2023–03–29
  28. By: Sharat Ganapati; Woan Foong Wong
    Abstract: This paper considers the evolution of global transportation usage over the past half century and its implications for supply chains. Transportation usage per unit of real output has more than doubled as costs decreased by a third. Participation of emerging economies in world trade and longer-distance trade between countries contribute to this usage increase, thereby encouraging longer supply chains. We discuss technological advances over this period, and their interactions with endogenous responses from transportation costs and supply chain linkages. Supply chains involving more countries and longer distances are reflective of reliable and efficient transportation, but are also more exposed to disruptions, highlighting the importance of considering the interconnectedness of transportation and supply chains in policymaking and future work.
    JEL: F14 F15 L91 R4 R41
    Date: 2023–04
  29. By: Jérôme Sgard (CERI - Centre de recherches internationales (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The conflict between Keynes and White, in the run-up to the 1944 Bretton Woods conference, left the IMF with a substantial capital, though without a rule-book on how to lend. The literature then insists on the introduction of the Stand-By Arrangement (1953), which remains till today the Fund's workhorse lending vehicle. Yet, the literature ignores the second step of the re-invention: policy conditionality, hence the capacity for the IMF to suspend lending when countries diverge from their pre-agreed economic objectives. This book chapter analyzes this brake-through, in the case of a policy loans to Paraguay and Bolivia, in 1956-1958. It then shows how this innovation triggered within a few years: 1/ a redefinition of the IMF as a crisis manager, in an entirely novel relation to borrowing countries; 2/ a full realignment of the relationship between the staff, the management and the key member-states, primarily the US; 3/ the adoption of a new economic framework, known as the monetary approach to the balance of payment; 4/ in parallel, the exploration of the legal and political consequences of defining the Stand-By as a non-contractual transaction, adequate to a relation to self-standing sovereign states.
    Keywords: IMF, conditionality, debt crisis
    Date: 2023
  30. By: Lampe , Markus (WU-Vienna); Hjortshøj O’Rourke , Kevin (NYU Abu Dhabi); Reiter , Lorenz (WU-Vienna); Yotov, Yoto (Drexel University)
    Abstract: This paper uses a new dataset on the universe of Canadian imports and tariffs between 1924 and 1936, disaggregated into 1697 goods originating in 112 countries, to analyze the impact on Canadian imports of interwar Canadian trade policy, including the 1932 Ottawa trade agreements. Rather than use a dummy variable approach, we compute the impact of individual tariffs which varied substantially across goods, trade partners, and time. We develop a novel method of controlling for multilateral resistances in the context of a one-country dataset, and perform a variety of counterfactual exercises to determine the impact of tariffs on trade flows. The overall impact of post-1929 tariff shifts, including the 1932 agreements, was relatively small, reflecting the fact that Canadian trade policy was already highly protectionist: trade agreements can have heterogeneous effects on participants because the shocks involved are different. Compared with a free trade counterfactual, the impact of the overall structure of protection on the level and composition of trade was large.
    Keywords: Trade policy; Trade Agreements; Interwar Tariffs; Multilateral Resistances; Trade Elasticities; Canada; Empire
    JEL: F13 F14 N72
    Date: 2023–05–05
  31. By: Alberto Bucci (Department of Economics, Management and Quantitative Methods (DEMM) - University of Milan, and ICEA (International Center for Economic Analysis, Canada); Riccardo Calcagno (Department of Management and Production Engineering, Polytechnic University of Turin); Simone Marsiglio (Department of Economics and Management, University of Pisa); Tiago Miguel Guterres Neves Sequeira (University of Coimbra, Centre for Business and Economics Research, CeBER and Faculty of Economics)
    Abstract: We extend a two-sector endogenous growth model based on human capital accumulation along two different directions. First, by postulating that individuals may invest time-resources not only in the accumulation of human capital (general knowledge) but also in the accumulation of financial literacy (specific financial knowledge). Second, we maintain that the efficiency with which savings are transferred intertemporally may improve over time, e.g. through the presence of a financial system. We use the model to analyze the relationship between financial literacy and economic growth in the long run. We show that the properties of the balanced growth path equilibrium critically depend on how human capital and financial literacy affect the efficiency of the financial system. Moreover, finance promotes long-run economic growth through two alternative channels, driven either by dynamics of financial returns or by human capital accumulation, respectively. By calibrating the model to the US economy over the 1950-2019 period, we quantitatively assess the effect of financial literacy on long-term growth and the relative magnitude of the two channels.
    Keywords: Economic Growth, Financial Literacy, Financial Return, Human Capital.
    Date: 2023–12
  32. By: Claire Lemercier (CSO - Centre de sociologie des organisations (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique); Jérôme Sgard (CERI - Centre de recherches internationales (Sciences Po, CNRS) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Le juge, classiquement, se prononce et condamne au nom du souverain. Alors que cet alignement classique opère depuis des siècles au plan intérieur, les marchés internationaux ont appelé des solutions beaucoup plus variées, ouvertes à l'expérimentation, très dépendantes aussi de l'ordre politique international dans lequel elles ont dû trouver place. L'arbitrage commercial international est une des solutions les plus puissantes, et aujourd'hui les plus influentes, qui aient émergé. En conflit sur l'exécution d'un contrat, deux entreprises prendront beaucoup plus souvent cette voie privée et volontaire, plutôt que de chercher une issue devant un tribunal officiel, toujours soupçonné de partialité ou de lenteur. Cette « privatisation » de la justice commerciale internationale a du toutefois être négociée avec les Etats, qui la reconnaissent et in fine la garantissent. Sans leurs garanties d'exécution, en particulier, les sentences arbitrales resteraient souvent lettre morte. Cet article porte sur l'invention et la consolidation progressive de l'arbitrage commercial international, entre les années 1920 et 1950. Il est centré sur l'expérience de la Chambre de Commerce Internationale, établie à Paris en 1919, qui a développé progressivement le modèle de référence en la matière, cela face à deux concurrents – l'un à Londres, l'autre à New York. La négociation et la légitimation de ce régime d'arbitrage va donc opposer, on le devine, des traditions juridiques, des organisations professionnelles mais aussi des projets de « gouvernance globale » très contrastés. Alors qu'Anglais et Américains défendent des projets nettement « impériaux », fortement ancrés dans leurs ordres juridiques domestiques, la CCI prend très tôt la voie d'un projet international, dans le sillage de la Société des Nations. Plus tard, au fil des renégociations de ce pacte avec les Etats, ce régime d'arbitrage évoluera vers une forme d'extra-territorialité juridique, qui recevra l'adhésion puissante des intérêts privés.
    Keywords: arbitrage commercial international, gouvernance globale, Chambre de Commerce Internationale
    Date: 2023–03
  33. By: Berger, Helge (International Monetary Fund); Karlsson, Sune (Örebro University School of Business); Österholm, Pär (Örebro University School of Business)
    Abstract: We assess the bivariate relation between money growth and inflation in the euro area and the United States using hybrid time-varying parameter Bayesian VAR models. Model selection based on marginal likelihoods suggests that the relation is statistically unstable across time in both regions. The effect that shocks to money growth has on inflation weakened notably after the 1980s before making a comeback after 2020. This instability implies that caution should be exercised when relating monetary aggregates to inflation.
    Keywords: Bayesian VAR; Time-varying parameters; Stochastic volatility; Model selection
    JEL: E31 E37 E47 E51
    Date: 2023–04–28
  34. By: ruggeri, giuseppe
    Abstract: A crucial element in the calculation of the Sicilian population prior to the periodic census enumerations (riveli) that began in 1505 is the tax rate on the revenue collected on a per household (fuoco) basis. There is no general agreement on which rate is the most appropriate for the estimation of the Sicilian population in 1277. For example, Bresc (1986) used a value of 6 tarì per household, Epstein (1992) applied 3 tarì, and Marrone (2002), who based his estimates on Peri (1978), employed a value of 2 tarì and 15 grani. The different values of the average tax rate affect both the level of the Sicilian population and its distribution among cities, towns, and villages. I suggest a reconciliation of these estimates based on a multi-rate tax structure based on the size of the revenue collected in each community. My estimates show a shift of the population from the Val di Mazara to the Val di Noto and a substantial increase in the population of the Valdemone.
    Date: 2023–04–20

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.