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on Business, Economic and Financial History |
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Issue of 2024‒08‒12
35 papers chosen by |
| By: | Armand, Alex (Nova School of Business and Economics); Atwell, Paul (Universidad Carlos III de Madrid); Gomes, Joseph (University of Navarra); Musillo, Giuseppe (Tilburg University); Schenk, Yannik (Universidade Nova de Lisboa) |
| Abstract: | This paper investigates the role of mass media in shaping racial tolerance and advancing civil rights in the post-WWII United States. We study the first attempt in the history of mass media to use a radio broadcast targeted at children to promote an inclusive American society. In 1946, amid persistent racial divisions, the popular radio series The Adventures of Superman launched Operation Intolerance, a sequence of new episodes promoting equality, rejecting racial discrimination, and exposing the KKK's bigotry. Using digitized historical data on U.S. radio stations and state-of-the-art radio propagation models, we compute geographic exposure to the broadcasts. Exploiting exogenous exposure to the broadcasts, we employ a cohort study design to analyze individual-level data from 1964 to 1980–a crucial period for civil rights activism and legislation in the United States. We find lasting impacts on those exposed as children, including increased support for civil rights, improved interracial relations, and more progressive political attitudes. These effects translate into greater alignment with the Civil Rights Movement, evidenced by increased support for protests and diminished institutional trust, and further manifested by reduced participation in the Vietnam War. Additionally, county-level panel data illustrate how areas covered by the broadcast in 1946 evolve towards less segregationist attitudes, a lower presence of the KKK, and an increase in civil rights activism and prominence in discourse. |
| Keywords: | mass media, radio, segregation, Ku Klux Klan, superman, intolerance, civil rights, racism, protest |
| JEL: | D7 D83 I24 J15 L82 N32 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17098&r= |
| By: | Sefa Awaworyi Churchill (School of Economics, Finance and Marketing, RMIT University.); Simon Chang (University of Western Australia Business School, University of Western Australia.); Russell Smyth (Department of Economics, Monash University.); Trong-Anh Trinh (Centre for Health Economics, Monash University.) |
| Abstract: | This paper extends prior theory linking present-day sex ratios to present-day propensity for entrepreneurship among men backward in time to explore the long-run gender origins of entrepreneurship. We argue that present-day propensity for entrepreneurship among men will be higher in neighbourhoods which had historically high sex ratios. We propose that high sex ratios generate attitudes and behaviours that imprint into cultural norms about gender roles and that vertical transmission within families create hysteresis in the evolution of these gender norms. To empirically test the theory, we employ the transport of convicts to the British colonies of New South Wales and Van Diemen’s Land in the eighteenth and nineteenth centuries as a natural experiment to examine the long-run effect of gender norms on entrepreneurship in present-day Australia. We use a representative longitudinal dataset for the Australian population that provides information on the neighbourhood in which the participant lives, which we merge with data on the sex ratio in historical counties from the mid-nineteenth century. We find that men who live in neighbourhoods which had high historical sex ratios have a higher propensity for entrepreneurship. We present evidence consistent with the vertical transmission of gender norms within families being the likely mechanism. Arguments for policies to promote female entrepreneurship are typically couched in terms of gender norms representing a barrier to more women starting their own business. We present evidence consistent with gender norms contributing to gender differences in rates of entrepreneurship by being a spur for higher male entrepreneurship rather than a barrier to female entrepreneurship. |
| Keywords: | gender norms, sex ratios, entrepreneurship, Australia. |
| JEL: | I31 J21 J22 N37 O10 Z13 Z18 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:mos:moswps:2024-11&r= |
| By: | Ina Ganguli; Jennifer R. Withrow |
| Abstract: | On February 5, 1917, the United States passed the Immigration Act of 1917, which included a test for all migrants arriving to the U.S. to prove they were literate. The Literacy Test was one of the first and few times the U.S. used a broad ‘skill-based’ immigration policy in an attempt to limit migration. We assess whether the Immigration Act had any measurable impacts on immigration to the U.S. Using a differences-in-differences approach and digitized data from Ellis Island ship manifests from directly before and after the Act’s passage and enactment, we show that the Act significantly altered selection into migration to the U.S. from Europe through Ellis Island, reducing migration from low literacy countries by 70 percent compared to arrivals from high-literacy countries. We also discuss other provisions of the Act that had the potential to influence the gender composition of arrivals. We show that women – and in particular single women – were less likely to arrive after its passage. Our analysis suggests that even during this period of lower immigration due to WWI and rising literacy levels, the 1917 Act was a consequential moment in immigration history in the United States. |
| JEL: | F22 J15 J61 N32 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32624&r= |
| By: | Fandiño, Pedro; Kerstenetzky, Celia; Simões, Tais |
| Abstract: | Wealth inequality has gained importance in the international debate following the publication of Capital in the 21st Century, by Thomas Piketty, which contains systematic data on the size and evolution of the phenomenon in advanced economies over the last few centuries. In particular, Piketty's research reveals an important decrease in wealth concentration throughout the 20th century, a decrease that has not been sustained in the first decades of the 21st century. What can be said about the levels and historical trajectory of wealth inequality in Brazil, one of the world’s most unequal countries? We investigated all available estimates since the 17th century. The work is organized based on the different sources and approaches used to construct the estimates, which cannot be directly obtained from national household surveys or censuses. Two conclusions stand out: a) wealth concentration presents extreme levels and notable stability over time, despite profound transformations in the composition of assets; and b) all available estimates have significant limitations. The availability of adequate public data, along with improvements in the procedures employed so far, is essential for the development of a literature on wealth inequality in the country – the first step towards effective public engagement with the issue. |
| Keywords: | wealth inequality; property; assets; Brazil; wealth concentration |
| JEL: | D31 D63 E01 |
| Date: | 2024–06–27 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:123988&r= |
| By: | Sabhlok, Sanjeev; Frijters, Paul (London School of Economics); Foster, Gigi (University of New South Wales); Bhattacharya, Jay (Stanford University); Joffe, Ari R (University of Alberta) |
| Abstract: | This paper reviews the history of the practice of quarantines, rediscovering the 19th century 'Sanitarian' movement in Britain that sprang from a recognition that quarantines had failed to stop the spread of diseases and were not cost-effective. To our knowledge, the key figure among the Sanitarians was Charles Maclean, who conducted the first cost-benefit analysis of quarantines. MacLean heavily influenced, among others, Southwood Smith and Edwin Chadwick, who, together with Jeremy Bentham, championed reforms that form part of the Public Health Act of 1848, which led to the primacy of sanitation efforts (such as pressurised water supply, sewage management, and garbage collection and safe disposal) in public health policy in the UK and elsewhere. Maclean convinced the Sanitarians that quarantines were not grounded in health science but instead formed part of the business model of a public health bureaucracy uninterested in public health and which was prepared to falsify and ignore data to survive. Arguably, the same can be said today with the modern version of quarantines being the Covid lockdowns of 2020-2021. We sketch a few preliminary institutional options for freeing public health efforts from bureaucratic expansion and mission drift and tethering them more robustly to the public interest. |
| Keywords: | public health, quarantines, social distancing, cost-benefit, excess deaths, health bureaucracy, mission drift |
| JEL: | I18 H00 N30 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17100&r= |
| By: | Richard Hornbeck; Guy Michaels; Ferdinand Rauch |
| Abstract: | We examine “agglomeration shadows” that emerge around large cities, which discourage some economic activities in nearby areas. Identifying agglomeration shadows is complicated, however, by endogenous city formation and “wave interference” that we show in simulations. We use the locations of ancient ports near the Mediterranean, which seeded modern cities, to estimate agglomeration shadows cast on nearby areas. We find that empirically, as in the simulations, detectable agglomeration shadows emerge for large cities around ancient ports. These patterns extend to modern city locations more generally, and illustrate how encouraging growth in particular places can discourage growth of nearby areas. |
| JEL: | N9 R12 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32634&r= |
| By: | Ann M Carlos (University of Colorado Boulder United States); Erik Green (Department of Economic History, Lund University); Calumet Links (Department of Economics, Stellenbosch University); Angela Redish (University of British Columbia Vancouver Canada) |
| Abstract: | This paper examines the responses of Indigenous nations and European companies to new trading opportunities: Cree nations and the Hudson's Bay Company (HBC), and Khoe nations and the Dutch East India Company (VOC). This case study is important because of the disparate outcomes: within a few decades the Cree standard of living had increased, and Khoe had lost land and cattle. Standard histories begin with the establishment of trading posts but this elides the decades of prior intermittent contact which played an important role in the disparate outcomes in the two regions. The paper emphasizes the significance of Indigenous agency in trade. |
| Keywords: | Indigenous economics, trade, ecology, cross-continental comparison |
| JEL: | N30 N70 N71 N77 J15 Q57 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:sza:wpaper:wpapers383&r= |
| By: | Daniela Vidart (University of Connecticut) |
| Abstract: | The decline in fertility occurring throughout the first half of the 20th century in the United States and preceding the baby boom remains largely unexplored. This paper presents empirical and theoretical evidence linking this decline to the spread of electricity. Using data on early electrification e˙orts, I empirically disentangle two channels linking electrification and fertility: the introduction of time-saving appliances that reduce the time needed for child-rearing; and the rise in female wages which raises the opportunity cost of childcare. I then use these empirical estimates to calibrate a model that features both channels and quantifies the aggregate impact of electrification on fertility. I find that electrification explains 3.1% of the overall fertility decline in 1900–1940 in the US, corresponding to a magnitude of 0.047 fewer children born to each woman, and that this decline is driven by young childless women who can reap the labor market gains of electricity. |
| JEL: | J13 J16 J22 O33 E24 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:uct:uconnp:2024-03&r= |
| By: | James Lake (Department of Economics, University of Tennessee); Andrew Greenland (Department of Economics, North Carolina State University); John Lopresti (Department of Economics, William and Mary) |
| Abstract: | Against a backdrop of sharply rising inequality, the Tokyo Round of the GATT resulted in a 1.6 percentage point reduction in average US tariffs – larger than CUSFTA, NAFTA, and the liberalization accompanying the granting of PNTR to China. We construct a novel IV based on the so-called ``Swiss formula'' that governed Tokyo Round tariff liberalization to provide the first evidence of its effects on imports and inequality. Instrumented tariff reductions explain 17% of the within-industry rise in income inequality between skilled and unskilled workers between 1979 and 1988. This effect is largest in more technology-intensive industries, suggesting a complementarity between trade liberalization and skill-biased technological change. We also show that tariff liberalization in upstream industries produced a shift away from labor more broadly and towards intermediate inputs. Finally, we show that policymakers dampened the observed impact of tariffs on inequality by assigning smaller tariff reductions to industries more reliant on low-skilled labor. |
| JEL: | F13 F14 F66 |
| Date: | 2024–01 |
| URL: | https://d.repec.org/n?u=RePEc:ten:wpaper:2024-01&r= |
| By: | Andrea Ramazzotti (Università di Napoli Federico II and CSEF) |
| Abstract: | Should minimum wages adjust to local productivity? Italy’s sectoral collective agreements make no adjustment, as they establish national wage floors irrespective of regional variation in income or cost of living. While some favour its equalizing action, many have argued that this approach causes inefficiencies that include low migration to more productive areas and high structural unemployment in less productive ones. This paper addresses these concerns by studying the spatial equalization of minimum wages in 1972, when the system was first introduced, using an original dataset of labour market variables covering the period 1962-1981. First, the paper presents an augmented gravity model of internal migration showing that spatial differentials in nominal minimum wages were a strong pull factors for both short- and long-distance migration before the reform, but not afterwards. Then, discussing potential mechanisms, the paper shows that the decrease in internal migration during the 1970s was associated with the inception of the spatial mismatches that characterize Italy’s labour markets to this day. |
| Keywords: | Wage Differentials, Internal Migration, Labor Economic History. |
| JEL: | J31 J61 N34 R23 |
| Date: | 2024–06–12 |
| URL: | https://d.repec.org/n?u=RePEc:sef:csefwp:716&r= |
| By: | Hoyt Bleakley; Paul Rhode |
| Abstract: | To engage with the large literature on the economic effects of slavery, we use antebellum census data to test for statistical differences at the 1860 free-slave border. We find evidence of lower population density, less intensive land use, and lower farm values on the slave side. Half of the border region was half underutilized. This does not support the view that abolition was a costly constraint for landowners. Indeed, the lower demand for similar, yet cheaper, land presents a different puzzle: why wouldn't the yeomen farmers cross the border to fill up empty land in slave states, as was happening in the free states of the Old Northwest? On this point, we find evidence of higher wages on the slave side, indicating an aversion of free labor to working in a slave society. This evidence of systemically lower economic performance in slavery-legal areas suggests that the earlier literature on the profitability of plantations was misplaced, or at least incomplete. |
| JEL: | N31 N51 N91 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32640&r= |
| By: | Andrea Ramazzotti (Università di Napoli Federico II and CSEF) |
| Abstract: | Do minimum wages influence post-compulsory school enrollment and educational choices? This paper studies the effect of sectorally-bargained minimum wages using a quasi-natural historical experiment from Italy around 1969, when labour unions obtained steep wage raises for manufacturing workers. Italy’s weakly-selective educational system—whereby students choose specialist educational curricula at age fourteen—allows to separately identify the impact on enrollment from that on educational choices. Absent microdata for the period under study, I present original estimates of education and labour-market variables at the province level with annual frequency between 1962 and 1982. Exploiting exogenous spatial variation in the intensity of the minimum wage hike between provinces with an instrumental variable approach and flexible Difference-in-Differences, I find a temporary increase in early school leaving and a permanent substitution away from vocational schools preparing for manufacturing jobs. The length of the adjustment might have caused a significant long-term loss for Italy’s human capital stock. |
| Keywords: | Wage Differentials, Education, Schooling, Economic History: Europe post-1913. |
| JEL: | J24 J31 N34 |
| Date: | 2024–06–12 |
| URL: | https://d.repec.org/n?u=RePEc:sef:csefwp:717&r= |
| By: | Humphries, Jane |
| Abstract: | This paper argues that in all societies there is considerable agreement about what goods and services are needed to provide a decent living, and that this standard can be measured by the expense involved in maintaining people of good standing. Maintenance costs include two components of living costs that are neglected in conventional approaches. First, in contrast to the usual focus on a fixed basket of commodities, maintenance costs capture changes in the composition and quality of the goods required for a respectable lifestyle. Second, unlike the conventional accounting they include the costs of the household services required to turn the basket commodities into livings. Ignored in the conventional methodology, the inclusion of these costs represents a core innovation. More than 4600 observations, drawn mainly from primary sources, trace levels and trends in maintenance costs for Britain, 1270-1860. These can be compared with established cost of living indicators to offer a complementary perspective on real consumption that accommodates aspirational goods and the input of household labour. The struggle to support families at respectable standards emerges as driving industriousness and motivating prudence among a class that played a major role in economic development. |
| Keywords: | cost-of-living; consumption; welfare; respectability; domestic labour; Wiley deal |
| JEL: | N00 N33 B54 |
| Date: | 2024–06–11 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:122856&r= |
| By: | Sundberg, Anton (IFAU and Uppsala University) |
| Abstract: | This paper examines the impact of parenthood on labor market outcomes for both men and women using population-wide annual income data from 1960 to 2021 in Sweden. First, I document the contemporary child penalties across several labor market outcomes. Second, I show that while the motherhood penalty in earnings declined significantly during the 1960s, 1970s, and early 1980s, the rate of decline slowed from the late 1980s onwards. Third, I identify a fatherhood penalty emerging since the 1980s, particularly pronounced among men in more gender-egalitarian households (proxied by the father’s share of parental leave) and among fathers who have sons relative to daughters. |
| Keywords: | Parenthood; child penalties; gender earnings gap |
| JEL: | J13 J16 J22 J31 |
| Date: | 2024–07–09 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2024_012&r= |
| By: | Abhay Aneja; Silvia Farina; Guo Xu |
| Abstract: | This paper combines personnel records of the U.S. federal government with census data to study how shocks to the gender composition of a large organization can persistently shift gender norms. Exploiting city-by-department variation in the sudden expansion of female clerical employment driven by World War I, we find that daughters of civil servants exposed to female co-workers are more likely to work later in life, command higher income, and have fewer children. These intergenerational effects increase with the size of the city-level exposure to female government workers and are driven by daughters in their teenage years at the time of exposure. We also show that cities exposed to a larger increase in female federal workers saw persistently higher female labor force participation in the public sector, as well as modest contemporaneous increases in private sector labor force participation suggestive of spill-overs. Collectively, the results are consistent with both the vertical and horizontal transmission of gender norms and highlight how increasing gender representation within the public sector can have broader labor market implications. |
| JEL: | J16 J7 N4 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32639&r= |
| By: | Anil K. Bera; Yannis Bilias |
| Abstract: | Rao (1948) introduced the score test statistic as an alternative to the likelihood ratio and Wald test statistics. In spite of the optimality properties of the score statistic shown in Rao and Poti (1946), the Rao score (RS) test remained unnoticed for almost 20 years. Today, the RS test is part of the ``Holy Trinity'' of hypothesis testing and has found its place in the Statistics and Econometrics textbooks and related software. Reviewing the history of the RS test we note that remarkable test statistics proposed in the literature earlier or around the time of Rao (1948) mostly from intuition, such as Pearson (1900) goodness-fit-test, Moran (1948) I test for spatial dependence and Durbin and Watson (1950) test for serial correlation, can be given RS test statistic interpretation. At the same time, recent developments in the robust hypothesis testing under certain forms of misspecification, make the RS test an active area of research in Statistics and Econometrics. From our brief account of the history the RS test we conclude that its impact in science goes far beyond its calendar starting point with promising future research activities for many years to come. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2406.19956&r= |
| By: | Celhay, Pablo (Pontificia Universidad Catolica de Chile); Gallegos, Sebastian (Universidad Adolfo Ibañez) |
| Abstract: | This paper presents new evidence on schooling mobility across three generations in six Latin American countries. By combining survey information with national census data, we have constructed a novel dataset that includes 50, 000 triads of grandparents, parents, and children born between 1890 and 1990. We estimate five intergenerational mobility (IGM) measures, finding that (i) the empirical multigenerational persistence in our six countries is twice as high as in developed countries, and 77% higher than what the theoretical model by Becker & Tomes (1986) predicts; (ii) Clark's (2014) theory of high and sticky persistence provides a better approximation for describing mobility across multiple generations in our sample; (iii) Even with high persistence, we uncover significant mobility improvements at the bottom of the distribution by estimating measures of absolute upward mobility (Chetty et al., 2014) and bottom-half mobility (Asher et al., 2022) over three generations. This novel evidence deepens our understanding of long-term mobility, and we expect future research to replicate it as more multigenerational data becomes available in different contexts. |
| Keywords: | developing countries, Latin America, intergenerational mobility, educational policy, multiple generations, compulsory schooling |
| JEL: | J62 N36 I24 I25 I28 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17072&r= |
| By: | Elizabeth U. Cascio; Paul Cornell; Ethan G. Lewis |
| Abstract: | We estimate the effects of permanent legal status on the health of children born to immigrants in the United States using variation from the Immigration Reform and Control Act of 1986 (IRCA). Our empirical approach compares trends in birth outcomes for foreign-born Mexican mothers across counties with different application rates under IRCA’s large-scale legalization programs. Maternal legalization raised birthweight. Effects arose immediately after the application process began – five years before affected women became Medicaid-eligible – suggesting causal mechanisms besides improved access to early prenatal care. Changes in the composition of births, stemming from changes in fertility and family reunification, contribute to but far from fully explain the birthweight impacts. The more likely mechanisms were instead the increases in family income and reductions in stress that came from gaining legal status. |
| JEL: | I13 I14 I18 J15 J61 K37 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32635&r= |
| By: | Maria Laura Victoria Marques; Ronaldo Seroa da Motta; Daniel de Abreu Pereira Uhr; Julia Ziero Uhr |
| Abstract: | The journal Energy Economics, a leading international peer-reviewed outlet for economic theory in the energy sector, celebrates its 45th anniversary in 2024. This article uses a bibliometric approach to present a retrospective of the journal's contributions. The study includes all publications from the journal based on data from the Web of Science and Scopus databases. The resulting sample comprises 6, 563 documents covering the period from 1979 to April 2024. The annual publication rate increased by 1.02 percent, with an average of 40.07 citations per document. Institutions from the United States of America and China lead in the number of articles published in the journal. A co-occurrence analysis of keywords was conducted, complemented by a sub-sample analysis, to provide a detailed view of thematic development and evolution over time. Finally, the article highlights future thematic trends of the journal, offering insights for editorial guidelines and interested authors. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2407.05974&r= |
| By: | Jose Barrales-Ruiz (Center of Economics for Sustainable Development (CEDES), Faculty of Economics and Government, Universidad San Sebastian, Chile); Codrina Rada (Department of Economics, University of Utah, USA); Rudiger von Arnim (Department of Economics, University of Utah, USA) |
| Abstract: | This paper provides a set of baseline empirical results on Goodwin cycles for the US post-war macroeconomy. Our sample consists of Hamilton-filtered series for nonfarm business sector output and labor share as well as the employment rate. Vector autoregressions (VARs) yield strong evidence for the Goodwin mechanism, i.e. profit-led activity and profit-squeeze distribution, in two (output or employment rate cycle vs. labor share cycle) and three (output, employment rate and labor share cycles) dimensions. We focus solely on the cycle rather than underlying trends, discuss how theory and empirical methods relate, and investigate whether and how the Goodwin mechanism has changed over time. To do so, we estimate split samples with standard recursive VARs for the 'golden age' (GA) and 'neoliberal era' (NE), as well as time-varying parameter VARs. Results indicate (i) overall a persistence of the Goodwin mechanism over the entire post-war period; but (ii) generally less pronounced cyclicality during NE than GA, and (iii) a weakening of the profit squeeze vis-`a-vis the employment rate over time as well as, on balance, a weakening of the profit led regime of both activity variables. |
| Keywords: | Neo-Goodwinian empirics, cyclical growth |
| JEL: | E12 E25 E32 J50 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:new:wpaper:2410&r= |
| By: | Guanie Lim (National Graduate Institute for Policy Studies, Tokyo, Japan); Nhat Anh Nguyen (National Graduate Institute for Policy Studies, Tokyo, Japan) |
| Abstract: | This paper delves into the transformation of East Asia's economic landscape post-World War Two, with a special emphasis on Vietnam's developmental path in the context of regional shifts. It evaluates the effects of the 'doi moi' reforms initiated in 1986, which, despite some successes, have led to limited advancements in fostering sustainable internal capabilities and in establishing a robust export-oriented manufacturing sector. The paper points out a notable trend: leading Vietnamese firms, including state-owned enterprises, predominantly engage in protected, non-tradable sectors such as real estate and finance, rather than in manufacturing. A critical examination reveals that Vietnam's governance structure and industrial policy approach contribute to its mixed economic performance. The absence of a dominant coordinating body or ministry in Vietnam, unlike the models seen in earlier East Asian industrializers, has resulted in ineffective policy execution and a governance model marked by decentralization and inefficiency. The paper concludes with a poignant argument: Vietnam's economic journey only loosely mirrors that of the early East Asian industrializers. The concern of Vietnam falling into a middle-income trap looms large, as its largest firms lack the dynamism to compete internationally. Promises of reform, while welcome, have also not been as forthcoming or consequential as initially expected. The paper calls for a radical overhaul in governance and policymaking to steer Vietnam away from mediocrity and towards a more promising economic future. |
| Keywords: | Development, Industrialization, Industrial Policy, East Asia, Vietnam, Governance, State-Business Relations |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:ngi:dpaper:24-01&r= |
| By: | Peter N. Ireland (Boston College) |
| Abstract: | From the very start of its fifty-year history, the Shadow Open Market Committee advocated for a monetary policy strategy focused on controlling inflation. With time, the rationale for price stability as the principal focus of monetary policy came to be accepted more widely by academic economists and Federal Reserve officials as well. The SOMC also consistently favored an operational approach involving the use of the monetary base as the policy instrument and a broader monetary aggregate as an intermediate target. These features of SOMC strategy, by contrast, have never gained widespread support among academics or at the Fed. This paper outlines the SOMC’s preferred approach, focusing on how the Committee’s money- based strategy and arguments for it evolved over time. It then shows that these arguments still apply with force today. |
| Keywords: | Inflation, Money Growth, Monetary Policy, Monetarism, Shadow Open Market Committee |
| JEL: | B22 B31 E31 E51 E52 E58 |
| Date: | 2024–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:boc:bocoec:1078&r= |
| By: | James B. Davies; Rodrigo Lluberas; Daniel Waldenström; James Davies |
| Abstract: | This paper examines long-term trends in aggregate wealth and inheritance and in their distributions, focusing on developed economies. A key stylized fact is that wealth is less equally distributed than income. Financial assets predominate among the wealthy, while owner-occupied housing is crucial for middle groups, so higher stock prices raise wealth inequality while house price increases do the opposite. Inheritances exacerbate absolute wealth inequality but reduce rel-ative inequality. Wealth inequality declined in advanced Western countries during the first half of the 20th century, then stabilized or rose. Aggregate wealth-to-income ratios have fluctuated, re-flecting both market and policy influences, whereas inherited wealth proportions have declined over the long run. Continued increases in the value of employer-based pensions, housing and social security wealth in recent decades have acted to reduce wealth inequality, offsetting the disequalizing impact of financial asset price increases to a varying extent across countries. |
| Keywords: | wealth, inheritance, inequality, saving, history |
| JEL: | E01 H55 D15 D31 E21 G51 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11183&r= |
| By: | Nathan H. Miller |
| Abstract: | This article addresses developments in the literature on The Rise of Market Power. First, it summarizes research about the result of De Loecker 2020 that the sales-weighted average markup has increased in the United States. Second, it summarizes and evaluates a set of industry studies that examine market power over long time horizons in specific settings. A theme that emerges from these industry studies is that technological advancements matter a great deal for the evolution of economic outcomes. By contrast, the studies do not point to weak antitrust enforcement as contributing to greater market power. The article concludes by outlining directions for future research. |
| JEL: | D40 L10 L40 L60 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32627&r= |
| By: | Assaf Razin; Andrzej Cieslik |
| Abstract: | This essay highlights the effects of radical transformations in the liberal characteristics of the regimes on foreign direct investors. To focus on the common patterns in the effects on foreign direct investment, of liberal vs. illiberal regime change, the essay spotlights the tale of two countries: Poland and Israel. The liberalization of the Polish economy and market reforms in the late 1980s and early 1990s boosted Poland's attractiveness to international companies. However, decades-long of illiberal policies under the PiS regime has reduced Poland's appeal to foreign investors. Similarly, Israel's GNP especially the high-tech sector saw significant growth from the 1990s to the 2010s, driven by the liberalization of capital and finance surges, and the global IT boom immigration. As a more-or-less a laboratory experiment for the real-economy impact of an abrupt transition to an illiberal regime, early steps of a comprehensive judicial overhaul have disrupted Israel's growth, causing a sharp decline in foreign direct investment. |
| JEL: | F21 F40 P00 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32614&r= |
| By: | Yuqing Song |
| Abstract: | Collaboration is a common artistic practice. The art market, however, often focuses on individual artists. How does collaboration affect the market value of artworks? The present study explores the market for collaborative paintings and calligraphy with a focus on one of the most important artists of the 20th century, Zhang Daqian (1899-1983), the “Picasso of the East.” We reveal a collaboration network of 247 nodes and 782 edges, spreading across three stages of the artist’s career. We provide evidence that, on average, collaborative artworks fetch lower prices than single-authored ones. Interestingly, not all collaborators lower prices equally. Network analysis suggests an inversely U-shaped relationship between a collaborator’s centrality and art prices. The paper sheds light on the mechanisms driving value in the market for collaborative artworks. |
| Keywords: | Collaboration; Collaborative paintings; Celebrity branding; Zhang Daqian; Chinese art market |
| Date: | 2024–07–09 |
| URL: | https://d.repec.org/n?u=RePEc:sol:wpaper:2013/375963&r= |
| By: | John H.Y. Edwards (Tulane University) |
| Abstract: | This paper examines the impact of education quality on income inequality among men and on female labor force participation. I introduce a new dataset on local education expenditures for a 64-year period. By matching education spending to the time and place where each person went to school, the data allow for a much more granular measurement of human capital differences than measures like level of schooling or years of school attainment. They also permit measurement of human capital differences and evolution over a much longer time period than the data that are typically available. I show that differences in the quality of education received during childhood become significant determinants of income differences among fully employed adult men. In a finding that is new to the literature, I report that school quality differentials are significant determinants of how adult women allocate their time between domestic labor and formal wage work. |
| Keywords: | Female Labor Force Participation, Women and Economic Development, Brazil, Education Quality, Income Distribution, Education |
| JEL: | I24 I25 O15 J24 J16 D31 D63 H75 N16 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:tul:wpaper:2409&r= |
| By: | Fuad, Syed; Farmer, Michael C. |
| Keywords: | Political Economy, Public Economics, Institutional And Behavioral Economics |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343965&r= |
| By: | Jaedo Choi; Andrei A. Levchenko; Dimitrije Ruzic; Younghun Shim |
| Abstract: | We quantify the contribution of the largest firms to South Korea's economic performance over the period 1972-2011. Using firm-level historical data, we document a novel fact: firm concentration rose substantially during the growth miracle period. To understand whether rising concentration contributed positively or negatively to South Korean real income, we build a quantitative heterogeneous firm small open economy model. Our framework accommodates a variety of potential causes and consequences of changing firm concentration: productivity, distortions, selection into exporting, scale economies, and oligopolistic and oligopsonistic market power in domestic goods and labor markets. The model is implemented directly on the firm-level data and inverted to recover the drivers of concentration. We find that most of the differential performance of the top firms is attributable to higher productivity growth rather than differential distortions. Exceptional performance of the top 3 firms within each sector relative to the average firms contributed 15% to the 2011 real GDP and 4% to the net present value of welfare over the period 1972-2011. Thus, the largest Korean firms were superstars rather than supervillains. |
| JEL: | F12 F16 L11 N15 O40 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32648&r= |
| By: | Barbara Rossi (ICREA-Pompeu Fabra University); Atsushi Inoue (Vanderbilt University); Yiru Wang (Pittsburgh University) |
| Abstract: | We contribute to the recent debate on the instability of the slope of the Phillips curve by offering insights from a flexible time-varying instrumental-variables approach robust to weak instruments. Our robust approach focuses directly on the Phillips curve and allows general forms of instability, in contrast to current approaches based either on structural models with time-varying parameters or on instrumental-variables estimates in ad hoc subsamples. We find evidence of a weakening of the slope of the Phillips curve starting around 1980. We also offer novel insights on the Phillips curve during the recent pandemic: the flattening has reverted and the Phillips curve is back. |
| Date: | 2024–06–29 |
| URL: | https://d.repec.org/n?u=RePEc:boc:fsug24:22&r= |
| By: | Cahuc, Pierre (Sciences Po, Paris) |
| Abstract: | This article provides an overview of the economic literature on short-time work. It presents the main characteristics of short-time work since its emergence in Germany in the 1930s. It analyzes its effectiveness as a job preservation mechanism, drawing on theoretical models and empirical studies. It concludes by highlighting the areas that future research could explore to address the most significant gaps in our understanding of short-time work. |
| Keywords: | short-time work, furlough, employment, working hours |
| JEL: | J23 J41 J63 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17111&r= |
| By: | Emiliano Toni; Pablo Paniagua; Patricio \'Ordenes |
| Abstract: | The Latin American region has suffered an economic slowdown since the end of the commodities boom. Within this context, Chile was the poster child of economic growth and development up until 2014. Since then, Chile has also been trapped in a decade of slow economic growth. Chile's sudden slowdown and recent growth path divergence have posed a puzzle for economic growth and development economics. This paper examines this slowdown from an empirical perspective and determines how much can be attributed to internal and external causes. Using a synthetic control approach and a structural time series Bayesian estimation, our findings suggest that at least two-thirds of the Chilean slowdown is attributable to internal causes driven by a policy regime change in 2014, with external factors playing a secondary role. The net effect of this set of internal reforms resulted in a nearly 10% reduction in real GDP per capita over five years and led to a 1.8% decline in average GDP growth rates from 2015 to 2019. Our results are consistent with the literature that establishes that external shocks can explain only a small fraction of the poor economic performance of developing countries, suggesting that internal factors are the primary source of subpar performance. This research sheds light on the potential effects of policy regime shifts in economic growth, thus providing valuable insights for development economics and, more specifically, emerging economies. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2407.02003&r= |
| By: | María del Carmen Dircio Palacios Macedo (Department of Economics, Universitat Jaume I, Castellón, Spain); Paula Cruz-García (Department of Economic Analysis, Universitat de Valencia, Spain); Fausto Hernández-Trillo (Center for Research and Teaching in Economics (CIDE), Mexico); Emili Tortosa-Ausina (IVIE, Valencia and IIDL and Department of Economics, Universitat Jaume I, Castellón, Spain) |
| Abstract: | Access to financial services is unequal around the world. In many countries, les than half of the population has an account at a financial institution, and this lack of access to finance is often a critical reason behind income inequality and uneven growth. This is the case of Mexico, where financial exclusion affects large shares of the population mainly in rural and poorer localities. This is an ongoing concern for policymakers, since it undermines socioeconomic opportunities for families and businesses alike, hampering economic growth and development. However, assessing the relevance of this issue requires a careful measurement of financial inclusion which, to date, has only been achieved to a limited extent. We contribute to the literature in this context by proposing a multivariate index of financial inclusion for Mexico, at the municipal level, for the period 2013–2021. This index covers several dimensions, including access, and usage. The results corroborate that a large proportion of the population is still unbanked, although it is unevenly distributed across the country. |
| Keywords: | composite indicator, financial inclusion, Mexican municipalities, Mexico |
| JEL: | G21 G23 G30 O16 R51 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:jau:wpaper:2024/06&r= |
| By: | Isabelle Guérin (IRD, CESSMA (Paris, France), IFP (Pondicherry, India)); Arnaud Natal (BSE (University of Bordeaux, CNRS, and INRAE), French Institute of Pondicherry (IFP)); Christophe Jalil Nordman (IRD, UMR LEDa, DIAL, PSL, Université Paris Dauphine, IFP (Pondicherry, India)); Govindan Venkatasubramanian (IFP (Pondicherry, India)) |
| Abstract: | This article explores the multifaceted role of marriages in central Tamil Nadu, India. By drawing on twenty years of ethnographic surveys and three household surveys conducted in 2010, 2016-17, and 2020- 21, this paper examines how marriages are both shaped by and constitutive of local political economies. Our data suggest five main findings. Firstly, marriage has undergone significant changes, with fewer cross-cousin marriages and more dowry practices in exogamous unions. Families prefer to marry within similar social circles. Secondly, dowry, once a tradition, now serves to prevent further land fragmentation and symbolises wealth transfer, despite legal reforms aiming at gender equality paradoxically reinforcing dowry traditions. Thirdly, the dowry received by boys depends on the parents’ education expenditures, as if the bride’s parents are somehow sharing in the effort of education. Fourthly, the analysis of determinants of ceremonial gifts points to the same direction, suggesting participants’ solidarity with parents who invest in their children’s education. Lastly, our data reveal, among other things, the role of education in the marriage market, pushing some highly educated men into celibacy while waiting for the ideal partner. |
| Keywords: | Marriage, kinship, dowry, ceremonial gifts, celibacy, economy, Tamil Nadu |
| JEL: | J12 D13 J16 |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:dia:wpaper:dt202407&r= |
| By: | Roxana Guti\'errez-Romero; Nayely Iturbe |
| Abstract: | Mexico has experienced a notable surge in assassinations of political candidates and mayors. This article argues that these killings are largely driven by organized crime, aiming to influence candidate selection, control local governments for rent-seeking, and retaliate against government crackdowns. Using a new dataset of political assassinations in Mexico from 2000 to 2021 and instrumental variables, we address endogeneity concerns in the location and timing of government crackdowns. Our instruments include historical Chinese immigration patterns linked to opium cultivation in Mexico, local corn prices, and U.S. illicit drug prices. The findings reveal that candidates in municipalities near oil pipelines face an increased risk of assassination due to drug trafficking organizations expanding into oil theft, particularly during elections and fuel price hikes. Government arrests or killings of organized crime members trigger retaliatory violence, further endangering incumbent mayors. This political violence has a negligible impact on voter turnout, as it targets politicians rather than voters. However, voter turnout increases in areas where authorities disrupt drug smuggling, raising the chances of the local party being re-elected. These results offer new insights into how criminal groups attempt to capture local governments and the implications for democracy under criminal governance. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2407.06733&r= |