nep-his New Economics Papers
on Business, Economic and Financial History
Issue of 2023‒10‒30
25 papers chosen by
Bernardo Bátiz-Lazo, Northumbria University

  1. History helps us understand gender differences in the labour market By Committee, Nobel Prize
  2. Scientific Background to the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2023 By Committee, Nobel Prize
  3. Explaining Gender Differences in Migrant Sorting: Evidence from Canada-US Migration By Escamilla-Guerrero, David; Lepistö, Miko; Minns, Chris
  4. The Refugee Advantage: English-Language Attainment in the Early Twentieth Century By Ran Abramitzky; Leah Platt Boustan; Peter Catron; Dylan Connor; Rob Voigt
  5. Industrial Policy and the Great Divergence By Réka Juhász; Claudia Steinwender
  6. Alberto Alesina (1957-2020): Man, Researcher, Professor of Economics, Popularizer By Vindigni, Andrea
  7. The twin deficits, monetary instability and debt crises in the history of modern Greece By Alogoskoufis, George
  8. Large Fires and the Rise of Fire Insurance in Pre-war Japan By Tetsuji Okazaki; Toshihiro Okubo; Eric Strobl
  9. On the promises and perils of Smithian growth – from pin factory to AI By Miller, Marcus
  10. Long Run Consequences of Ethnic Conflict On Social Capital: Evidence from South Africa By Paz, Santiago
  11. Can’t See the Forest for the IVs Re-examining the Cistercian “Pre-reformation Roots of the Protestant Ethic” By Nico Sonntag
  12. Peru: in need of fresh stimulus By Alix Vigato
  13. The 1950 Indo-Nepal Treaty of Peace and Friendship: Road to Review By Acharya, Mahesh
  14. Understanding Italy's stagnation By Krahé, Max
  15. Monetary transmission in Iceland - Evidence from a structural VAR model By Thorarinn G. Petursson
  16. Self-Fulfilling Debt Crises with Long Stagnations By Ayres, JoaÞo; Navarro, Gaston; Nicolini, Juan Pablo; Teles, Pedro
  17. Monetary targeting revisited By Kern, Florian; Sigl-Glöckner, Philippa; Krahé, Max
  18. Beyond Bitcoin: A Taxonomy of Cryptocurrencies in a Historical Perspective By Zubarev, Andrey (Зубарев, Андрей); Shilov, Kirill (Шилов, Кирилл)
  19. Geldpolitische Implementierung im Wandel By Kern, Florian; Sigl-Glöckner, Philippa; Krahé, Max
  20. Is "Inflation First" Really "Rentiers First"? The Taylor Rule and Rentier Income in Industrialized Countries By Mario Seccareccia; Guillermo Matamoros
  21. Economic Management In A Multiple Equilibria Economy By Zainab Fatima
  22. Unveiling the Hidden Impact of Urban Land Rents on Total Factor Productivity By Mr. Bas B. Bakker
  23. El último Plan Económico del Primer Ciclo del Gobierno de Raúl Alfonsín (1983-1985): Tensiones, Contradicciones e Inestabilidad Permanente By Ignacio Rossi
  24. A Classical Marxian Two-Sector Endogenous Cycle Model: Integrating Marx, Dutt, and Goodwin By Cajas Guijarro, John
  25. Long-term effects of early adverse labour market conditions: A Causal Machine Learning approach By Petru Crudu

  1. By: Committee, Nobel Prize (Nobel Prize Committee)
    Abstract: Over the past century, the proportion of women in paid work has tripled in many high-income countries. This is one of the biggest societal and economic changes in the labour market in modern times, but significant gender differences remain. It was first in the 1980s that a researcher adopted a comprehensive approach to explaining the source of these differences. Claudia Goldin’s research has given us new and often surprising insights into women’s historical and contemporary roles in the labour market.
    Keywords: Gender in labor markets;
    JEL: J70 J71 J78
    Date: 2023–10–09
  2. By: Committee, Nobel Prize (Nobel Prize Committee)
    Abstract: Women are severely underrepresented in the global labor market: around 50% of women work or actively seek work for income, compared to 80% for men. The gender differences in participation are fundamentally driven by variation in women’s participation rates – men’s participation rates are broadly constant across time and countries. The participation gaps between men and women are particularly large in South Asia, the Middle East, and North Africa, where they sometimes exceed 50 percentage points.
    Keywords: Gender in labor markets;
    JEL: J70 J71 J78
    Date: 2023–10–09
  3. By: Escamilla-Guerrero, David (University of St Andrews); Lepistö, Miko (Paris School of Economics); Minns, Chris (London School of Economics)
    Abstract: Using newly digitized Canada-Vermont border crossing records from the early twentieth century, this paper identifies key factors that may explain differences in how female and male migrants sort by human capital across destinations. Earnings maximization largely explains sorting patterns among males, while gender discrimination has a large effect on the sorting of female migrants. Everything else equal, destinations with institutional and social environments that limited the participation of women in the labor market attracted a lower-skilled mix of both single females and couples. Although married women were typically tied to a spouse whose labor market opportunities determined the joint destination, we find evidence suggesting that their degree of agency in the destination choice increased with human capital.
    Keywords: migration, sorting, gender, Canada, United States
    JEL: J61 N31 N32
    Date: 2023–09
  4. By: Ran Abramitzky; Leah Platt Boustan; Peter Catron; Dylan Connor; Rob Voigt
    Abstract: The United States has admitted more than 3 million refugees since 1980 through official refugee resettlement programs. Scholars attribute the success of refugee groups to governmental programs on assimilation and integration. Before 1948, however, refugees arrived without formal selection processes or federal support. We examine the integration of historical refugees using a large archive of recorded oral history interviews to understand linguistic attainment of migrants who arrived in the early twentieth century. Using fine-grained measures of vocabulary, syntax and accented speech, we find that refugee migrants achieved a greater depth of English vocabulary than did economic/family migrants, a finding that holds even when comparing migrants from the same country of origin or religious group. This study improves on previous research on immigrant language acquisition and refugee incorporation, which typically rely on self-reported measures of fluency. Our findings are consistent with the hypothesis that refugees had greater exposure to English or more incentive to learn, due to the conditions of their arrival and their inability to immediately return to their origin country.
    JEL: J15 N32
    Date: 2023–09
  5. By: Réka Juhász; Claudia Steinwender
    Abstract: We discuss recent work evaluating the role of the government in shaping the economy during the long 19th century, a practice we refer to as industrial policy. We show that states deployed a vast variety of different policies aimed at, primarily, but not exclusively, fostering industrialization. We discuss the thin, but growing literature that evaluates the economic effects of these policies. We highlight some fruitful avenues for future study.
    JEL: F14 N10 O14 O33
    Date: 2023–09
  6. By: Vindigni, Andrea (University of Genova)
    Abstract: This paper offers an overview of Alberto Alesina's life and of his scholarly work (§ 1 and 2). It will be argued, that Alberto would have entirely deserved the award of the Nobel Prize for Economic Science, except only for his premature passing away. His foundational contribution was the creation, and the development of modern political economy since the mid 1980s (§ 3). This is a highly eclectic discipline at the cross-road of economics and political science. I will briefly attempt to explain what political economy is mainly about, and what political economy is nowadays understood to mean: its basic assumptions, its methodology, its goals, its main relations with modern economics (§ 4). I will then focus on the general introduction (§ 5), and the analytical discussion (§ 5.1) of one of Alberto's most important and impactful contributions: his 1994 work with Dani Rodrik on redistributive politics and economic growth. In my opinion, this is not only one of the many path-breaking and extremely impactful contributions of Alberto, but it best illustrates his scholarly traits and his research agenda. This paper has indeed influenced a large subsequent body of literature; I will mention a few highly celebrated among such contributions (§ 5.2). I will then very briefly discuss a few other relatively early works of Alberto, that have also contributed to the foundation and to the establishment of modern political economy (§ 6). These early works could have been part of a hard core of contributions, potentially more than justifying the assignment of the Nobel Prize in Economics to Alberto Alesina. Finally, I will briefly discuss some of his late work (§ 7), as well as my own personal relation with Alberto (§ 8), a truly unique human being, and master of all the Italian economists (and of many other social scientists). Some acknowledgments (§ 9), and a short but essential bibliography (§ 10) conclude this paper.
    Keywords: economic growth, inequality, public debt, government, political economy, redistribution, culture
    JEL: O11 O43
    Date: 2023–09
  7. By: Alogoskoufis, George
    Abstract: This paper reviews, analyses and interprets the determinants and the implications of the twin, fiscal and current account, deficits in the history of modern Greece. The analysis focuses on the determinants and the dynamic interactions among the twin deficits, domestic monetary regimes, and access to international borrowing. Two are the main conclusions: First, when Greece did not have access to international borrowing, fiscal imbalances usually led to monetary destabilization and inflation. Second, when it did have access to international borrowing, fiscal imbalances were generally larger, led to external deficits and, eventually, sovereign debt crises and defaults. The monetary and exchange rate regime also mattered. The 1950s and 1960s were the only prolonged period in which the twin deficits were tackled effectively and, as a result, the only period in which Greece enjoyed high economic growth, monetary stability, and external balance simultaneously.
    Keywords: modern Greece; economic history; institutions; fiscal policy; monetary policy; debt crises
    JEL: N10 N20 N40
    Date: 2023–10–02
  8. By: Tetsuji Okazaki; Toshihiro Okubo; Eric Strobl
    Abstract: We explore the role that large fires played in the early developed of the fire insurance industry of pre-WWII Japan. To this end we construct a prefecture level data set spanning thirty years. Our econometric results show that large fires led to an increase in new policies and policy renewals, a result that is in line with historical narratives that insurance companies used these events to advertise their business. We also show that this subsequent surge in renewals and new policy holders led to more fraudulent behaviour by increasing the number of small fires due to arson, whereas there was no effect on unintentionally set small fires. While we are unable to identify whether this was due to adverse selection of new policy holders or moral hazard behaviour of existing ones, anecdotal evidence that is more likely to have been the latter. Key words : Fire insurance, Disaster, Moral hazard, Adverse selection, Japan JEL classification numbers : G22, G52, N25
  9. By: Miller, Marcus (University of Warwick, CAGE and CEPR)
    Abstract: For path-breaking insights on how prices can guide the efficient allocation of resources and on how innovation and investment can spur economic growth, Adam Smith is justly renowned. He was, however, well aware of problems posed by market dominance - specifically in banking and, more generally, wherever getting to the scale that delivers increasing returns leads to monopolistic behaviour. For the historical record, we draw on the recent wide-ranging survey by Acemoglu and Johnson on how the benefits of innovation have been spread across society since the Industrial Revolution. We also consider these issues in the context of geo-political competition.
    Keywords: The Wealth of Nations by Adam Smith; Increasing Returns to Scale; monopoly; excess risk-taking; case studies of economic history; geo-political competition JEL Classification: B12, D61, E25, L12, O33, P51
    Date: 2023
  10. By: Paz, Santiago (Universidad de los Andes)
    Abstract: This paper studies the following research question: What are the consequences of historical ethnic conflict on contemporary levels of social capital? This question is relevant, since understanding the consequences of historical ethnic violence on contemporary social capital can provide useful inputs to design effective State-building policies. I exploit Mfecane, a period of ethnic upheaval in South African history, as a setting to examine the causal effects of historical ethnic conflict on contemporary levels of social capital. For this end, I use a combination of a historical approximation of the Mfecane warzone with geocoded data from the Afrobarometer project (2000-2016). Using an instrumental variables strategy, I find that historical ethnic conflict decreases contemporary trust in people among individuals living within the borders of Mfecane, while increasing trust in relatives and neighbors. Increases in in-group trust appear to be driven by the long run persistence of parochial altruism. Conversely, lower levels of betweengroup trust can be explained by the lack of economic incentives to cooperate with strangers in former warzones. These results are suggestive of a degree of substitutability between in-group and between-group social capital, at the community level.
    Keywords: Violence; Social Capital; Trust; Ethnic Conflict; South Africa
    JEL: D74 N00 O10 O12 O13 Q34
    Date: 2023–09–21
  11. By: Nico Sonntag (Johannes Gutenberg University Mainz)
    Abstract: I re-examine the claim made by Andersen, Bentzen, Dalgaard, and Sharp that the work ethic of the Cistercian order instigated the kind of cultural change attributed to Protestantism by Max Weber. Following a critical discussion of their historical and theoretical arguments, as well as an assessment of the original study design, I reconsider and expand upon their analyses of the positive associations between past Cistercian presence and early modern economic development as well as contemporary values. Theories about the historical origins of economic development can often only be tested indirectly. Moreover, the theories are often insufficient to deduce the precise specification of statistical models or to choose among competing ways to measure a theoretical construct with available historical data. For this reason, I conduct a systematic robustness check that takes into account a wide range of plausible model specifications. While the correlation between Cistercians and population growth remains robust, all models attempting to identify a causal effect either rely on specific and hard-to-justify choices concerning the operationalization of central constructs or fail to provide strong confirmatory evidence. Furthermore, additional analyses investigating the mediation effect of contemporary value orientations on economic indicators contradict the proposed mechanism. The text concludes by offering recommendations on how to systematically study the cultural and economic impact of Christian orders.
    JEL: N13 O11 Z12
    Date: 2023–10–11
  12. By: Alix Vigato
    Abstract: Driven by the boom in its mining sector and its rigorous macroeconomic policies, since the early 2000s Peru has experienced a period of spectacular development, described as the “Peruvian Miracle”. Nominal GDP in US dollar terms has increased almost fivefold over the last 20 years and the various human development and poverty indicators have made significant progress. This cycle is especially remarkable as it follows two decades, from 1980 to 2000, marked by civil war and economic crisis.
    Keywords: Pérou
    JEL: E
    Date: 2023–10–12
  13. By: Acharya, Mahesh
    Abstract: After much wrangling for decades, Nepal and India have finally spearheaded in the direction to revise officially perhaps the most controversial treaty between them. Kathmandu and New Delhi have constituted a joint Eminent Persons Group (EPG) in early 2016 to review the past treaties and agreements and submit recommendations to the respective governments so that they befit the current realities. The Indo-Nepalese Treaty of Peace and Friendship signed in 1950 which has been a perennial irritant from the early years of its inception, is undoubtedly the major agenda on the table. There would be hardly disagreement that it could be a good starting point in the direction to quell the deeply ingrained mutual distrust but much will depend on the political will of both the capitals as the recommendations of EPG will not be obligatory. The paper will examine the different facets of the Treaty which both the parties see the need to review, and explore the reasons which held New Delhi and Kathmandu back for whopping sixty seven years to traverse the road to the review.
    Date: 2023–09–17
  14. By: Krahé, Max
    Abstract: Italy's economic stagnation is a matter of fiscal, national, and European concern. Since a good remedy requires an accurate diagnosis, this paper summarises, compares, and evaluates the main explanations for this stagnation. After describing Italy's recent economic record, the paper reviews three families of explanations: "unwillingness to reform" accounts, monetary integration accounts, and accounts that prioritise the firm-level perspective. Concluding that, taken by themselves, none of these explanations provide a fully convincing account, a synthesis of their most promising elements follows. In this synthesis, the paper argues that Italy's recent stagnation can be traced back to two key moments: first, a failed attempt during the 1990s and early 2000s to overcome the growth slowdown of the 1970s and 1980s. Guided by the ideas of their time and the desire to meet the Maastricht convergence criteria, policy-makers chose a mix of market-liberalising reforms and demand suppression. Though well-intentioned, this mix proved counterproductive, lowering investment- and human capital growth and deepening the growth slowdown it was meant to remedy. The second key moment was the retention of this policy mix in the late 2000s and early 2010s. In the wake of 2008, once investors realised that the ECB would not be a conventional lender of last resort, spreads on Italian government bonds increased, and although the macro-financial architecture of the Eurozone was reformed, these reforms militated towards a doubling-down on Italy's pre-crisis policy mix. Subject to these pressures, policy-makers retained the broad strokes of the earlier policy mix, even after its ineffectiveness had become apparent. While this paper does not develop proposals for a new reform mix, its diagnosis implies that any credible reform package must tackle the deep roots of Italy's stagnation without repeating the investment-suppressing mistakes of the last 30 years. In light of this, positive conditionality - i.e. conditions that unlock additional resources, as with NextGenEU - with a focus on companies, institutions and investment, may be a promising way forward.
    Date: 2023
  15. By: Thorarinn G. Petursson
    Abstract: This paper analysis the transmission mechanism of monetary policy in Iceland using three alternative identification schemes in a structural VAR setting. Consistent with the international literature, we find that an unexpected monetary policy tightening leads to a temporary but sizable contraction in output, a sustained appreciation of the nominal exchange rate, and a more sluggish and persistent decline in inflation. Three other structural shocks are also identified. All have plausible economic interpretation and can explain the bulk of the variation in output and inflation over our sample period. By comparison, the contribution from monetary policy shocks is relatively modest, especially to output fluctuations. Historical decomposition shows, however, that monetary policy played an important role during the disinflation of the second half of the 2010s and in offsetting a large negative demand shock following the global pandemic at the start of this decade. However, the historical decomposition also suggests that the withdrawal of the post-Covid monetary easing was too slow, thus contributing to rising inflation by the end of the sample period.
    JEL: C32 E52 F41
    Date: 2023–09
  16. By: Ayres, JoaÞo; Navarro, Gaston; Nicolini, Juan Pablo; Teles, Pedro
    Abstract: We assess the quantitative relevance of expectations-driven sovereign debt crises, focusing on the Southern European crisis of the early 2010s and the Argentine default of 2001. The source of multiplicity is the one in Calvo (1988). Key for multiplicity is an output process featuring long periods of either high growth or stagnation that we estimate using data for those countries. We find that expectations-driven debt crises are quantitatively relevant but state dependent, as they only occur during stagnations. Expectations are a major driver explaining default rates and credit spread differences between Spain and Argentina.
    Keywords: Self-fulfilling debt crises;sovereign default;Multiplicity;Stagnations
    JEL: E44 F34
    Date: 2023–02
  17. By: Kern, Florian; Sigl-Glöckner, Philippa; Krahé, Max
    Abstract: Central banks define a monetary policy strategy in which they set out the instruments they use to achieve their monetary policy objectives as well as the incoming data they take into account when using these instruments. Independent central banks in particular are expected to provide a detailed and comprehensible explanation of their monetary policy strategy, since the absence of direct democratic legitimation comes along with particular accountability requirements. Since the end of the Bretton Woods system, both the Federal Reserve Bank (Fed) and the Deutsche Bundesbank, and later the European Central Bank (ECB), have made significant changes to their monetary policy strategy. In the 1970s, both the Bundesbank and the Fed pursued, at least officially, a monetary targeting strategy. We explain the analytical fallacies that underlay this strategy and the ideological assumptions that paved its way into practice. It is still unclear why a framework that is incoherent even at the theoretical level has been upheld for so long. It is conceivable that path dependency and a negative error culture played a role. Accordingly, we propose an evaluation of monetary policy strategy and its changes since 1973 with the aim of identifying and remedying relevant institutional weaknesses. The evaluation should also aim at clarifying whether monetary targeting resulted in institutional choices that continue to prevent monetary policy from achieving the Union's stated objectives in an optimal manner to this day. Considering that the quantity theory of money underlying monetary targeting is also propagated by supporters of cryptocurrencies, who use it specifically to attack the legitimacy of central banks, a reappraisal of the theory should also help to strengthen trust in central banks and reduce the damage caused by cryptocurrencies.
    Date: 2022
  18. By: Zubarev, Andrey (Зубарев, Андрей) (The Russian Presidential Academy of National Economy and Public Administration); Shilov, Kirill (Шилов, Кирилл) (The Russian Presidential Academy of National Economy and Public Administration)
    Abstract: The field of cryptocurrencies has been in existence and dynamically developing for over 14 years. Each year sees the advent of new cryptocurrencies, with their total count now exceeding 8, 500, and it is evident that these differ from one another in some respects. However, there currently exists no exhaustive categorization of cryptocurrencies that could comprehensively describe the landscape of the cryptocurrency market. This situation underpins the relevance of the present study. The object of this study is cryptocurrencies. The aim of the research is to create a taxonomy of cryptocurrencies based on their primary characteristics and functions. The main method of research is a retrospective analysis of the development of the cryptocurrency sector from the creation of Bitcoin to the present day. Over the course of the industry's evolution, new projects emerged, substantially different in their properties from anything that had come before, thus forming entirely new categories and niches in the cryptocurrency space. Furthermore, the advent of certain types of cryptocurrencies could lead to changes in the existing classification. The outcome of this study is a hierarchical categorization (taxonomy) of interchangeable cryptocurrencies/tokens. The proposed taxonomy is supplemented by an in-depth examination of cryptocurrencies belonging to each category, as well as a consideration of the largest cryptocurrencies in terms of capitalization through its prism. The scientific novelty of this research lies in the absence of similar studies that look at the issue of categorizing cryptocurrencies through a historical lens.
    Keywords: Cryptocurrencies, Bitcoin, Blockchain, Smart Contracts, Ethereum, Decentralized Finance, DeFi
    JEL: F39 G23
    Date: 2023–05–25
  19. By: Kern, Florian; Sigl-Glöckner, Philippa; Krahé, Max
    Abstract: Zentralbanken definieren eine geldpolitische Strategie, in der sie darlegen, welche Instrumente sie nutzen, um ihr geldpolitisches Ziel zu erreichen, und welche einkommenden Daten sie aus welchen Gründen bei der Nutzung der Instrumente berücksichtigen. Insbesondere von unabhängigen Zentralbanken ist zu erwarten, dass sie ihre geldpolitische Strategie ausführlich und verständlich erläutern, da das Fehlen einer direkten demokratischen Legitimation mit besonderen Rechenschaftspflichten einhergeht. Seit dem Ende des Bretton-Woods-Systems haben sowohl die Federal Reserve Bank (Fed) als auch die Deutsche Bundesbank und später die Europäische Zentralbank (EZB) erhebliche Änderungen an ihrer geldpolitischen Strategie vorgenommen. In den 1970-er Jahren verfolgten sowohl die Bundesbank als auch die Fed zumindest offiziell eine Strategie der Geldmengensteuerung. Wir erklären, welche analytischen Denkfehler der Strategie zugrunde lagen und welche ideologischen Annahmen ihr den Weg in die Praxis ebneten. Noch unklar ist, warum ein schon in der Theorie inkohärentes Rahmenwerk über so lange Zeit hinweg aufrechterhalten wurde. Denkbar ist, dass Pfadabhängigkeit und eine negative Fehlerkultur eine Rolle spielten. Entsprechend schlagen wir eine Evaluierung der geldpolitischen Strategie und ihres Wandels seit 1973 mit dem Ziel vor, entsprechende institutionelle Schwachstellen zu identifizieren und auszubessern. Die Evaluierung sollte auch klären, ob aus der Geldmengensteuerung institutionelle Weichenstellungen resultierten, die noch heute die Geldpolitik davon abhalten, die erklärten Ziele der Union bestmöglich zu verfolgen. Vor dem Hintergrund, dass die der Geldmengensteuerung zugrunde liegende Quantitätstheorie auch von Anhängern von Kryptowährungen propagiert wird, die damit gezielt die Legitimität von Zentralbanken angreifen, trägt eine Aufarbeitung der Theorie auch dazu bei, Vertrauen in Zentralbanken zu stärken und den durch Kryptowährungen entstehenden Schäden zu reduzieren.
    Date: 2022
  20. By: Mario Seccareccia (University of Ottawa); Guillermo Matamoros (University of Ottawa)
    Abstract: The Taylor rule has returned as a significant policy guide amid increasingly overt political pressures for its official (and not just its implicit) adoption at the US Fed as inflation fears have come to dominate monetary policy actions both in the US and internationally in recent times. Our paper analyzes the effect of monetary policy on the functional distribution of income by reconstructing how the post-1970s "inflation first" policy commitments of central banks came to be crystallized in the Taylor rule. While there are differences among the various specifications of this "rule", the Taylor relation is merely an offshoot of what can be described generically as the family of Wicksellian reaction functions whose implications support rentier income over time. Because of the internal logic of the Taylor rule, this has led to different interpretations such as, for example, the more Keynesian Yellen rule, which depart from the strict sense of the Taylor rule. The paper also interprets the Taylor Rule in light of Wicksell's formulation and analyzes the potential consequence of the differences. In contrast to the strict Wicksell rule of "proportional" adjustment, our econometric findings suggest evidence that central banks adjust "over-proportionally" the benchmark money interest rate in the presence of changes in the inflation rate for the complete "inflation first" era since the 1970s until the COVID-19 crisis. They thereby strongly favored rentier incomes in their reaction functions, with the possible exception of the post-financial crisis period. To limit the pro-rentier consequences of such inflation-targeting regimes, it is important that policymakers mandate multiple objectives for central banks, as exemplified in the current US Fed's dual mandate.
    Keywords: Central bank reaction functions, income distribution, monetary policy, Taylor rule, Wicksell rule
    JEL: E12 E52 E58
    Date: 2023–07–10
  21. By: Zainab Fatima (Pakistan Institute of Development Economics)
    Abstract: This webinar addresses the critical failures in economic management within economically developed countries in recent years. The webinar speaker is Mr. Andrew R. W. Smithers, a respected figure in finance, widely recognized for his insightful commentary, columns, and literary contributions. In 1989, he established Smithers & Co., following a successful tenure as the head of S G Warburg’s asset management business. Notable among his publications are “Valuing Wall Street, ” “Wall Street Revalued, ” “The Road to Recovery, ” “Productivity and the Bonus Culture, ” and “The Economics of the Stock Market.” Andrew critically examines prevailing economic theories and advocates for timely reforms to prevent recurring financial crises. In this webinar, he sheds light on the key causes behind these failures and emphasizes the importance of improving both economic policies and theories.
    Date: 2023
  22. By: Mr. Bas B. Bakker
    Abstract: This paper addresses the puzzling decline of Total Factor Productivity (TFP) levels in rapidly growing economies, such as Singapore, despite advancements in technology and high GDP per capita growth. The paper proposes that TFP growth is not negative; instead, standard growth decompositions have underestimated TFP growth by overestimating the contribution of capital, failing to account for the substantial part of capital income directed to urban land rents. This leads to an overestimation of changes in capital stock's contribution to growth and thereby an underestimation of TFP growth. A revised decomposition suggests that TFP growth in economies with high land rents and rapid capital stock growth, such as Singapore, has been considerably underestimated: TFP levels have not declined but increased rapidly.
    Keywords: Total Factor Productivity; Economic Growth; Capital Stock; Land Rents; Growth Decomposition; Urban Economics; Population Density; Diminishing Returns to Scale; Technological Progress; Singapore; TFP level; re-estimating TFP; land rent; decline of total factor productivity; Capital income; Stocks; Land prices; Asia and Pacific
    Date: 2023–08–25
  23. By: Ignacio Rossi (Universidad Nacional de Luján)
    Abstract: El Plan Económico de Bernardo Grinspun (1983-1985) desarrollado como primera estrategia económica durante el gobierno de Raúl Alfonsín (1983-1989) fue menos estudiado frente al Plan Austral formulado a partir de 1985. Si bien la estrategia keynesiana del primer ministro de Economía fue breve, aún constituye un campo de vacancia para comprender cómo se abordaron desde el gobierno los desafíos económicos. Con el objetivo de contribuir a su conocimiento, el trabajo aborda el Plan Económico Argentino de diciembre de 1984, formulado conjuntamente entre el Ministerio de Economía y el Banco Central en el cuadro del cierre de un acuerdo conel Fondo Monetario Internacional por la deuda externa. Contrastado con fuentes periodísticas, bibliográficas, memorias y otros documentos institucionales de la época, sostenemos que dicho programa muestra las contradicciones, debates y tensiones inherentes a la política económica nacional como debilidades en la estrategia macroeconómica de mediano plazo.
    Keywords: Deuda externa; inflación; Banco Central; macroeconomía.
    Date: 2023–09
  24. By: Cajas Guijarro, John
    Abstract: This paper introduces a Classical Marxian Two-Sector Endogenous Cycle (CMTSEC) model, merging Dutt's (1988) two-sector model of Classical convergence with labor dynamics inspired by Goodwin (1967) and an endogenous labor supply inspired by Harris (1983). Empirical support fortifies these assumptions. Utilizing the Hopf bifurcation theorem and numerical simulations, we demonstrate the model's capacity to produce stable limit cycles encompassing wage share, employment rate, and sectoral capital distribution. Notably, sectoral profit rates exhibit cyclic fluctuations, prompting a reevaluation of long-run equilibrium. The model underscores the role of investment sensitivity to sectoral profit rate disparities in determining cycle stability. Hence, the CMTSEC model extends Goodwin’s (1967) endogenous cycle model, encapsulating the conflict between capital and labor while delving into the intricate dynamics of capitalist reproduction in a two-sector economy.
    Keywords: two-sector model; labor market dynamics; endogenous cycles; sensitivity of investment to profit rate differentials; long-run equilibrium
    JEL: C61 E11 E32 O41
    Date: 2023–09–22
  25. By: Petru Crudu (Department of Economics, University Of Venice CÃ Foscari)
    Abstract: This study estimates the long-term causal effects of completing education during adverse labour market conditions, measuring outcomes 35 years post-education. To achieve this, the study combines historical regional unemployment rates with detailed SHARE microdata for European cohorts completing education between 1960 and 1990 in a novel database. A systematic heterogeneity analysis is conducted by leveraging the Causal Forest, a causal machine learning estimator that allows estimates at various aggregation levels. Furthermore, the causal link is validated using an instrumental variable approach. The main findings reveal that a one-percentage-point increase in the unemployment rate at the time of completing education leads to a significant decline in earnings (-5.2%) and self-perceived health (-2.23%) after 35 years. The heterogeneity analysis uncovers that the results are primarily driven by less educated individuals and highlights a permanent disadvantage for women in labour market participation. This study also provides evidence that systematic divergence in life trajectories can be explained by search theory and human capital models. Overall, the research suggests that the consequences of limited post-education opportunities can be permanent, underscoring the importance of identifying vulnerable groups for effective policy interventions.
    Keywords: Long-term Effects, Unemployment, Heterogeneous Effects, GRF
    JEL: J31 I1 J24 I24 E24
    Date: 2023

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