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on Business, Economic and Financial History |
| By: | Leon Huetsch; Dirk Krueger; Alexander Ludwig |
| Abstract: | We build a unified quantitative theory of increasing adult life expectancy and income growth in the last two centuries, and the emergence of a modern health sector in the 20th century. We interpret the data as three phases of a dynamic equilibrium in which households are initially poor, the price of health goods is prohibitively high, and life expectancy is stagnant. As technological progress fuels income growth, households commence consuming basic health goods and life expectancy rises in the first half of the 19th century. 100 years later, further directed technological progress leads to the emergence of a modern health sector. Through the lens of the model, the quality-adjusted relative price of modern health goods declined by about 2.5% per year between 1940 and 2020 while the model-implied relative price that lacks quality adjustment increases in line with the BEA health price index. Counterfactual analyses suggest that almost one fourth of adult life expectancy gains between 1940 and 2020 are attributed to the emergence and expansion of modern health and that public spending on health R&D during World War II played an important role in the kickoff of the modern health sector. |
| JEL: | E13 I15 O41 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35092 |
| By: | Tetsuji Okazaki (The University of Tokyo) |
| Abstract: | During World War II, the Japanese government carried out a large-scale mobilization of the labor force for war production. To move young and middle-aged men into the military and strategic industries where they were essential, the government restricted male employment in certain designated industries where female workers could substitute for male workers. Women were regarded as a major source of labor, in addition to men in “nonessential and nonurgent†industries and (male) students. Exploiting the variation in the regulation of male employment across industries, we conducted a simple regression analysis to investigate the impact of the war on the female labor force participation, using industry-level panel data from 1920 to 1970. We found that the female employment ratio in the industries where male employment was restricted, increased relative to the other industries from 1940, and that this effect continued at least until 1970. This suggests that wartime labor mobilization had a positive impact on female labor participation, and that the impact was persistent. The case study on major banks indicates that major banks indeed made efforts to substitute female for male employees, and that they changed the internal organization and rules to achieve this. In addition, the transition of individual female employees of Mitsubishi Bank from 1936 to 1960, indicates that a substantial number of the wartime entrants remained until 1952, and that Mitsubishi Bank continued the wartime recruiting and human resource management policy, i.e. the recruiting many female employees and appointing them to wider range of jobs, after the war. These findings from the case studies would explain the persistent change in the nation-wide employment structure by gender. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:tky:fseres:2026cf1271 |
| By: | Greitens, Jan |
| Abstract: | This paper contributes to current debates surrounding the digital euro and US stablecoins by unpacking the present day relevance of two important episodes in monetary history: Prussia's effort in the 18th century to implement a uniform coinage standard across the Holy Roman Empire, and the 19th century Currency School Banking School debate. While the ECB presents the digital euro as a conservative measure designed to preserve the existing two tier system and the euro as a currency anchor, Prussia's failed reform efforts show that political will must be accompanied by political clout for a monetary standard to become widely accepted. Meanwhile, the US is promoting stablecoins backed by government debt in order to foster innovation and extend the dominance of the dollar. Based on a close reading of Hayek, this paper critiques currency competition as a justification for stablecoins. The risk of a fragmented monetary system no longer amenable to central bank control is also discussed with reference to the Currency School Banking School debate, which discloses the perennial importance of balancing stability with elasticity while alsoavoiding fragmentation. In this way Prussian and British historical experience with monetary system reform sheds valuable light on the parameters that policymakers should consider when devising or assessing proposals for digital money, as a failure could lead to uncertainty and the fragmentation of the monetary system or excessive rigidity in the money supply. |
| Keywords: | Digital Euro, Monetary Anchor, Gresham's Law, Currency Competition, Stablecoins |
| JEL: | E42 E58 N13 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ibfpps:340050 |
| By: | Garcia, Armando |
| Abstract: | This article argues that Iceland's wartime 'Situation' (Ástandið), the expansive moral and administrative apparatus erected to govern relationships between Icelandic women and Allied soldiers during and after the Second World War, was a foundational project of pacification through which Iceland consolidated itself as a white security state. Approaching security as social war (Neocleous, 2025) alongside Veblen's analysis of pecuniary culture and trained incapacity (Veblen, 2008), the article demonstrates how eugenic anxieties about a fragile Icelandic 'racial stock' (kynstofn) underpinned gendered surveillance, emergency legislation, forced medical examination, and carceral confinement targeting working-class young women. A state-negotiated colour bar, rooted in Prime Minister Jónasson's 1941 demand for 'white troops only' and institutionalised in secret provisions of the 1951 US–Iceland Defence Agreement, inserted Iceland into a militarised global apartheid (Besteman, 2019; 2020). Children born of these relationships, ástandsbörn, were marked as racially liminal through naming practices and community ostracism, extending pacification across generations as a form of necropolitical governance over kinship and futurity (Mbembe, 2003). Connecting these histories to contemporary moral panics over 'migrant predators', DNA collection proposals targeting non-EEA residents, and violent protest policing, the article argues that governing rationalities forged during Ástandið persist in a spectral pacification of racialised migrants and dissenting citizens. Mobilising critical conversations on culture, security, and white supremacy, the article positions Iceland as a formative site for critical race inquiry. |
| Date: | 2026–04–11 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:2k4ge_v2 |
| By: | Guillaume Blanc and Romain Wacziarg (Simon Fraser University) |
| Abstract: | For most of human history, until the fertility transition, technological progress translated into larger populations, preventing sustained improvements in living standards. We argue that migration offered an escape valve from these Malthusian dynamics after the European discovery and colonization of the Americas. We document a strong relationship between fertility and migration across countries, regions, individuals, and periods, in a variety of datasets and specifications, and with different identification strategies. During the Age of Mass Migration, persistently high fertility across much of Europe created a large reservoir of surplus labor that could find better opportunities in the New World. These migrations, by relieving demographic pressures, accelerated the transition to modern growth. |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:sfu:sfudps:dp26-05 |
| By: | Eduard Dobre (University of Bucharest, Romania) |
| Abstract: | In the mid-19th century, the model of Catholic journeymen's associations founded by Adolph Kolping spread rapidly from Germany to Central and Eastern Europe. For his contribution he was surnamed “the journeyman’s father†(Ridder, 1956). This study analyses the emergence and evolution of the Catholic Journeymen's Association in Timișoara in the broader context of urban industrialization and social change in the Banat region. Founded in Timișoara in 1859, it was the first association in Banat, Transylvania, and Bukovina, after the one established in Bucharest in the same year. The association was closely linked to the Catholic Church and benefited from the support of the clergy and local economic elites. Particular attention is paid to the role of the association in integrating young craftsmen into an urban society in the midst of industrialization. The religious, civic, and professional training of its members can also be found in the period after 1989, in the associations called the Kolping Family, which took the name of the founder. Based on archival documents, press sources, and specialized literature, the research highlights the importance of an associative model that generated sociability, education, and civic training in Timișoara's urban society. |
| Keywords: | Timisoara, Banat, Catholic Journeymen Associations, Kolping, Urban Sociability, Industrialization |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:smo:raiswp:0654 |
| By: | Tamar den Besten; Regis Barnichon; Diego R. Känzig; Aayush Singh |
| Abstract: | We study the macroeconomic effects of tariff policy using U.S. historical data from 1840–2024. We construct a narrative series of plausibly exogenous tariff changes – based on major legislative actions, multilateral negotiations, and temporary surcharges – and use it as an instrument to identify a structural tariff shock. Tariff increases are contractionary: imports fall sharply, exports decline with a lag, and output and manufacturing activity drop persistently. The shock transmits through both supply and demand channels. Prices rise in the full sample but fall post-World War II, a pattern consistent with changes in the monetary policy response and with stronger international retaliation and reciprocity in the modern trade regime. |
| JEL: | E30 F13 F14 F41 H20 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35102 |
| By: | IM, HYUN-NAM |
| Abstract: | This paper challenges the fundamental assumptions of mainstream economics, particularly the concept of Homo Economicus (the rational economic man) and the mathematical illusion of general equilibrium. By integrating Giambattista Vico’s cyclical philosophy of history with established economic theory, this treatise proposes a new ontological framework for understanding modern capitalism. First, this paper redefines human economic behavior not as rational choice, but as the dynamic interaction of an ontological triad structured around libido, anxiety, and sin. Second, it diagnoses the 21st century as the ‘Era of Grand Analogy’, in which physical imitation and administrative bureaucracy have given rise to a state of collective amorality (Søren Kierkegaard’s Åndløshed). Third, it deconstructs the ‘equal sign (=)’ of macroeconomics as a mere decalcomanic illusion created by densely aggregated data. Furthermore, it traces how this illusion solidified into a natural theory in tandem with the exponential expansion of currency, population, and administration, thereby exposing it as a mechanism that conceals the ‘legalized plunder’ perpetrated by vested interests. In particular, this paper rejects the conventional, dry mathematical style of academic writing, instead adopting a metaphorical and literary mode of exposition that embeds Vico’s cyclical philosophy of history into the very structure of the text itself. Ultimately, this paper argues that economics must be understood as fundamentally distinct from Platonic political idealism; rather, it is the immanent law of the masses—a living embodiment of Vico’s principle verum ipsum factum (the truth is what is made). It concludes that the resolution to the modern structural crisis lies not in the mechanical adjustment of economic variables, but rather in the restoration of Aristotelian ethics and authentic education. |
| Keywords: | Giambattista Vico, Legalized Plunder, Era of Grand Analogy, Aristotelian Ethics, Ontological Triad. Heterodox Economics, Macroeconomic Theory. |
| JEL: | B41 E32 K00 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128737 |
| By: | Dalibor Stevanovic (University of Quebec in Montreal) |
| Abstract: | This paper studies the 2021 U.S. inflation forecasting failure. I show that the failure was primarily driven by sample composition rather than functional-form misspecification: estimation samples dominated by the Great Moderation underweight supplyshock regimes, and expectations anchored to that regime were slow to recognize the shift. Three historically informed adjustments, an intercept correction, a similarity re-estimation on 1970s data, and a kernel-weighted estimator, substantially close the forecast gap, and the gains extend to eight additional U.S. price indices. Household survey respondents over 60, whose lifetime includes the 1970s, reported higher inflation expectations from early 2021, consistent with experience-based learning; younger cohorts remained anchored to the prevailing regime. A controlled experiment with large language models conditioned on “experienced†and “young†professional personas confirms that experiential priors generate significant forecast differences under a common training leakage assumption. Across all three exercises, the source of the prior mattered more than the sophistication of the model. |
| Keywords: | Inflation forecasting, regime change, historical analogy, experience-based learning, expectations anchoring, large language models |
| JEL: | C22 C53 D84 E31 E37 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:bbh:wpaper:26-02 |
| By: | Luis Bosshart; Max Deter; Leander Heldring; Cathrin Mohr; Matthias Weigand |
| Abstract: | We digitize and analyze the near-universe of National Socialist German Workers' Party (NSDAP) membership records and link them to newly digitized population and industrial censuses. Four findings emerge. First, as the party expanded, its membership came to resemble the broader population more closely in occupational, demographic, and religious terms. Second, SS members remained distinctly different: younger, more educated, and more fanatical, as proxied by membership portraits. Third, within communities, coworkers, and families, early membership generated hysteresis, with subsequent entrants drawn from the same groups. Finally, local increases in party membership are associated with subsequent deportations of Germany's Jews. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.17697 |
| By: | Dalibor Stevanovic |
| Abstract: | This paper studies the 2021 U.S. inflation forecasting failure. The author shows that the failure was primarily driven by sample composition rather than functional-form misspecification: estimation samples dominated by the Great Moderation underweight supply-shock regimes, and expectations anchored to that regime were slow to recognize the shift. Three historically informed adjustments, an intercept correction, a similarity re-estimation on 1970s data, and a kernel-weighted estimator, substantially close the forecast gap, and the gains extend to eight additional U.S. price indices. Household survey respondents over 60, whose lifetime includes the 1970s, reported higher inflation expectations from early 2021, consistent with experience-based learning; younger cohorts remained anchored to the prevailing regime. A controlled experiment with large language models conditioned on “experienced” and “young” professional personas confirms that experiential priors generate significant forecast differences under a common training leakage assumption. Across all three exercises, the source of the prior mattered more than the sophistication of the model. Cet article étudie l’échec des prévisions d’inflation aux États-Unis en 2021. L'auteur montre que cet échec s’explique principalement par la composition de l’échantillon d’estimation plutôt que par une mauvaise spécification de la forme fonctionnelle : des échantillons dominés par la période de la Grande Modération ont sous-pondéré les régimes marqués par des chocs d’offre, et des anticipations ancrées dans ce régime ont tardé à reconnaître le changement. Trois ajustements fondés sur l’expérience historique, une correction de constante, une ré-estimation par similarité à partir des données des années 1970, et un estimateur pondéré par noyau, réduisent substantiellement l’écart de prévision, et ces gains s’étendent à huit indices de prix américains supplémentaires. Les répondants aux enquêtes auprès des ménages âgés de plus de 60 ans, dont l’expérience de vie inclut les années 1970, ont déclaré des anticipations d’inflation plus élevées dès le début de 2021, ce qui est cohérent avec l’hypothèse d’un apprentissage fondé sur l’expérience ; les cohortes plus jeunes sont restées ancrées dans le régime dominant. Une expérience contrôlée utilisant de grands modèles de langage conditionnés par des profils professionnels « expérimentés » et « jeunes » confirme que des priors expérientiels génèrent des différences significatives de prévision sous une hypothèse commune de fuite d’information liée à l’entraînement. Dans les trois exercices, la source des croyances initiales a compté davantage que la sophistication du modèle. |
| Keywords: | Inflation forecasting, regime change, historical analogy, experience-based learning, expectations anchoring, large language models, Prévision de l’inflation, changement de régime, analogie historique, apprentissage fondé sur l’expérience, ancrage des anticipations, grands modèles de langage |
| JEL: | C22 C53 D84 E31 E37 |
| Date: | 2026–04–22 |
| URL: | https://d.repec.org/n?u=RePEc:cir:cirwor:2026s-06 |
| By: | Nicolaas van der Wath |
| Abstract: | Reviews South Africa's economic performance over thirty years of democracy through the lens of national accounts, tracing trends in growth, investment, consumption, and fiscal outcomes. |
| Keywords: | national accounts, South Africa, democracy, economic history, growth |
| JEL: | O47 O55 E01 |
| Date: | 2024–08–23 |
| URL: | https://d.repec.org/n?u=RePEc:cxs:wpaper:202404 |
| By: | Sergio A. Correia; Stephan Luck; Emil Verner |
| Abstract: | Do banks fail because of runs or because they become insolvent? Answering this question is central to understanding financial crises and designing effective financial stability policies. Long-run historical evidence reveals that the root cause of bank failures is usually insolvency. The importance of bank runs is somewhat overstated. Runs matter, but in most cases they trigger or accelerate failure at already weak banks, rather than cause otherwise sound banks to fail. |
| Keywords: | bank runs; bank failures; deposit insurance; bank regulation; bank supervision |
| JEL: | H0 |
| Date: | 2026–04–16 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednls:103048 |
| By: | Michael Fritsch (Friedrich Schiller University Jena and Halle Institute for Economic Research (IWH)); Michael Wyrwich (University of Groningen, and Friedrich Schiller University Jena) |
| Abstract: | Historical structures and developments can have a significant and long-lasting impact on the level and the quality of regional entrepreneurship. One explanation for such effects is the formation of a regional "culture", an informal institution which is long-lasting and influences individual behavior. Another explanation for the long-term effects of historical structures and events is the presence of a collective memory. This article reviews the empirical evidence of the historical roots of regional entrepreneurial activity and its potential explanations. Furthermore, the consequences for the development of theories and the policy implications are discussed. Finally, the article reviews promising avenues for further research. |
| Keywords: | History, persistence, long-term effects, institutions, culture, collective memory |
| JEL: | L26 M13 N9 O1 R11 |
| Date: | 2026–04–16 |
| URL: | https://d.repec.org/n?u=RePEc:jrp:jrpwrp:2026-004 |
| By: | Charles W. Calomiris; Matthew S. Jaremski |
| Abstract: | Financial crises remain a recurrent feature of modern economies despite evidence that many are predictable and preventable. This chapter discusses how financial instability often reflects a political equilibrium rather than purely technocratic shortcomings. Contrasting economic and political perspectives on regulation, the chapter emphasizes how policymakers shape financial rules in ways that favor politically-influential groups but result in financial vulnerability. Key mechanisms include restricted bank chartering, safety nets, credit subsidies, and sovereign borrowing. Political forces also shape crisis management. Delayed interventions, selective support, and constrained policy responses can deepen and prolong crises. Together, these dynamics help explain the persistent and foreseeable nature of financial instability across time, legal origins, political structures, and institutional contexts. Instead of seeing financial crises as arising from an unavoidable vulnerability to external shocks they are better seen as a mirror of the societies in which they occur, reflecting their political structures, vying constituencies, cultural preferences, and blind spots. |
| JEL: | E44 F34 G01 H12 N1 N2 P16 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35101 |
| By: | Montpetit, Sébastien (University of Warwick) |
| Abstract: | This paper examines the impact of prohibiting the Islamic veil in schools on economic outcomes and long-run integration of Muslim women. Using a difference-in-differences design, I show that the 1994 directive instructing school principals to ban the veil in French schools led to a substantial decline in educational attainment among affected cohorts, with persistent consequences for employment and marriage market outcomes. An analysis of mechanisms suggests that these effects stem primarily from heightened perceptions of discrimination and mistrust toward the French school system, rather than shifts in parental educational investments. I also show that misclassification of religion in prior work introduces substantial bias. Despite the adverse economic consequences, the affected cohorts exhibit stronger identification with France but also higher levels of religiosity, suggesting a mixed long-run impact on cultural assimilation |
| Keywords: | headscarf ban, religious identity, women’s education, cultural integration, marriage market, misclassification bias JEL codes: I28, J16, J15, Z12 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:wrk:warwec:1610 |
| By: | Ling Feng; Qiuyue Huang; Zhiyuan Li; Christopher M. Meissner |
| Abstract: | This paper investigates the causal impact of international trade on interstate military conflicts using global bilateral data from 1962 to 2014. To address endogeneity concerns, we exploit exogenous spatial-temporal variation in international trade stemming from technological advances in air relative to maritime transport. Empirical results demonstrate a strong “peace dividend” of international trade: that is, increased trade significantly reduces the probability and intensity of conflicts between nations. This effect remains robust across specifications and withstands a wide range of potential confounders. Such findings highlight how economic interdependence shapes international conflict—a relationship that is especially relevant amid escalating geopolitical tensions and the global shift toward “decoupling”, “de-risking”, and greater trade protectionism. |
| JEL: | F14 F51 F69 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35078 |
| By: | Johan Fourie |
| Abstract: | Examines how political coalitions shape economic growth outcomes in South Africa, analysing the incentives and constraints facing key actors in the growth policy arena. |
| Keywords: | political economy, growth coalitions, South Africa, institutions |
| JEL: | O43 P16 D72 |
| Date: | 2026–03–17 |
| URL: | https://d.repec.org/n?u=RePEc:cxs:wpaper:202604 |
| By: | Francisco Rodr\'iguez |
| Abstract: | Bastos, Geloso, and Bologna Pavlik (2026) argue that the US embargo explains less than one tenth of the difference in per capita income between Cuba and a counterfactual scenario in which the country did not follow socialist economic policies. We show that their results are driven by the use of an elasticity of income to trade openness that is neither representative nor a reasonable upper bound of the values found in the literature and by their choice to attribute the effect of the interaction between the embargo and other determinants of growth solely to those other determinants. We show that, once these problems are corrected, the embargo can account for a substantial fraction, and in some cases all, of Cuba's post 1959 economic underperformance. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.19627 |