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on Business, Economic and Financial History |
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Issue of 2009‒08‒16
ten papers chosen by |
| By: | Richard N. Langlois (University of Connecticut) |
| Abstract: | Business groups in all of their manifestations are informational mechanisms for coordinating complementary activities -- for "gap filling." This is well known in the literature on business groups outside the Anglo-American sphere. Especially in developing economies, where markets are thin and institutions (including both political institutions and what I call market-supporting institutions) are weak or non-existent, coordination is often more cheaply undertaken within the boundaries of business groups organized as financial pyramids, typically under family control. These organizations are intimately linked to the coalition of territorial rulers that North and his coauthors (2009) call a natural state; and, indeed, such business groups are arguably themselves examples of a natural state, in that they represent a self-enforcing coalition with its own rules, norms, and mechanisms of enforcement. But even in ÈdevelopedÉ economies, novelty and change create the sorts of gaps that call for business groups in the widest sense, including less-formal sets of "intermediate" relationships, as, for example, in industrial districts. In this sense, the economics of organization generally has perhaps more to learn from the literature on business groups than the other way around. |
| Keywords: | business groups, vertical integration, transaction costs, institutional economics, business history. |
| JEL: | L2 L63 N62 O33 O34 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2009-23&r=his |
| By: | Julian FRANKS; Colin MAYER; MIYAJIMA Hideaki |
| Abstract: | Corporate ownership and financing in Japan in the 20th century are striking. In the first half of the 20th century equity markets were active in raising more than 50% of the external financing of Japanese companies. Ownership was dispersed both by the standards of other developed economies at the time and even by those of the UK and U.S. today. In the second half of the 20th century, bank finance dominated external finance and interlocking shareholdings by banks and companies became widespread. The change from equity to bank finance and from an outsider system of public equity markets to an insider system in the middle of the 20th century coincided precisely with a marked increase in investor protection. Informal institutional arrangements rather than formal investor protection explain the existence of equity in the first half of the century - business co-ordinators in the early 20th century and zaibatsu later. Insider ownership in the form of bank ownership and cross-shareholdings emerged in the second half of the century as a response to the failure of minority shareholder protection, the needs of Japanese institutions to raise new equity for fast growing firms, and for the financial restructuring of failing firms. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:09039&r=his |
| By: | David S. Jacks |
| Abstract: | In this paper, we investigate time-dependent border and distance effects in the nineteenth century and document clear declines in the importance of these variables through time. What this suggests, in light of the work for the post-1950 era, is that researchers might have correctly identified the increasing effect of distance on bilateral trade over time. In other words, trade costs may have not declined nearly as dramatically in the late twentieth century as has been supposed, especially in light of the nineteenth century, a time of documented trade cost decline and commodity market integration. |
| JEL: | F40 N70 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15250&r=his |
| By: | Robin Pope |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:bon:bonedp:bgse11_2009&r=his |
| By: | Jaakko Pehkonen; Ojala; Jari |
| Abstract: | This study analyses the evolution of wages and occupational composition of labour over three centuries, from 1755 to 1914, using worker-workplace data. The data from one industry offers a unique view on long-term trends in skill composition, wage inequality and occupational wage premiums. A major shift in the production technology, a shift from sail-only vessels to steam-operated vessels, in turn, allows the examination the popular skill-biased technological change (SBTC) hypothesis in a well-defined setting. We find that (i) technological change had both a new-skill-demanding aspect, showing up as an increase in the demand for skilled engineers, and a skill-replacing aspect, resulting in a decline in the demand for skilled able-bodied seamen and an increase in unskilled engine room operatives, (ii) increasing wage inequality in the latter part of the 18th century was associated with the emergence of new skilled occupations and rising wages of skilled seamen, and (iii) wage inequality evolved slowly over time and there were different, declining and rising phases in wage inequality. |
| Keywords: | Wage inequality, skill composition, technological change |
| JEL: | J31 |
| Date: | 2009–06–10 |
| URL: | http://d.repec.org/n?u=RePEc:fer:wpaper:5&r=his |
| By: | Julio Martinez-Galarraga; Joan R. Roses; Daniel A. Tirado Fabregat |
| Abstract: | This paper studies the evolution of Spanish regional inequality from 1860 to 1930. The results point to the coexistence of two basic forces behind changes in regional economic inequality: industrial specialization and labor productivity differentials. The initial expansion of industrialization, in a context of growing economic integration of regions, promoted the spatial concentration of manufacturing in certain regions, which also benefited from the greatest advances in terms of labor productivity. Since 1900, the diffusion of manufacturing production to a greater number of locations generated the emulation of production structures and a process of catching-up in labor productivity and wages. |
| Keywords: | Industrialization, Market Integration, Heckscher-Ohlin Model, New Economic Geography |
| JEL: | N93 N94 R11 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:cte:whrepe:wp09-05&r=his |
| By: | Oleh Havrylyshyn (University of Toronto) |
| Abstract: | While many observers thought it was premature for Czech Prime Minister Klaus to suggest in 1995 the transition was over except for fine-tuning , as we approach the 20th year after the fall of the Berlin Wall on Nov. 9, 1989,-and the 18th after the dissolution of the Soviet Union at Byelovezha- it is surely relevant to ask the question again. The first new contribution of this paper is to show that ,for all practical purposes, the post-communist transition is over in eight or nine early reformers of Central Europe and the Baltics; but it is not over for other transition countries –though many are close, and only a few very far behind. The second and perhaps more important novelty of this paper is that it goes beyond the qualitative expert judgments in earlier studies addressing this question. With one or two exceptions, earlier studies did not start with an explicit analytical definition of transition and its end-point, and evidence provided was selective often mixing partial quantitative measures with qualitative judgments-albeit well reasoned ones. This paper proposes an analytical definition of transition and its end-point , as well as ways this can be measured quantitatively without undertaking impossibly massive econometric exercises . |
| Keywords: | transition, efficient allocation, share of consumption, share of industry, direction of trade, trade openness, comparative advantage |
| JEL: | F15 N10 N14 O11 P2 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:qed:wpaper:1209&r=his |
| By: | Alcidi, Cinzia; Gros, Daniel |
| Abstract: | This paper explores three areas in which the experience of the Great Depression might be relevant today: monetary policy, fiscal policy and the systemic stability of the banking system. We confirm the consensus on monetary policy: deflation must be avoided. With regard to fiscal policy, the picture is less clear. We cannot confirm a widespread opinion according to which fiscal policy did not work because it was not tried. We find that fiscal policy went to limit of what was possible under the conditions as they existed then. Our investigation of the US banking system shows a surprising resilience of the sector: commercial banking operations (deposit taking and lending) remained profitable even during the worst years. This suggests one policy conclusion: At present the authorities, in both the US and Europe, have little choice but to make up for the losses on ‘legacy’ assets and wait for banks to earn back their capital. But to prevent future crisis of this type one should make sure that losses from the investment banking arms cannot impair commercial banking operations. At least a partial separation of commercial and investment banking seems thus justified by the greater stability of commercial banking operations. |
| Keywords: | Great depression; Monetary policy; Fiscal policy; Commercial banks |
| JEL: | B22 E60 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16726&r=his |
| By: | Lex Borghans; Frank Cörvers |
| Abstract: | Over the past two decades there has been a substantial increase in the mobility of students in Europe, while also research has become much more internationally oriented. In this paper we document changes in the structure of research and higher education in Europe and investigate potential explanations for the strong increase in its international orientation. While higher education started to grow substantially around 1960, only a few decades later, research and higher education transformed gradually to the American standard. Decreased communication costs are likely causes for this trend. This transformation is most clearly revealed in the change of language used in research from the national language, Latin, German and French to English. Smaller language areas made this transformation earlier while there are also clear timing differences between research fields. Sciences and medicine tend to switch to English first, followed by economics and social sciences, while for law and arts only the first signs of such a transformation are currently observed. This suggests that returns to scale and the transferability of research results are important influences in the decision to adopt the international standard. |
| JEL: | I23 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15217&r=his |
| By: | Rolf Gehrmann |
| Abstract: | - |
| Keywords: | German Empire, censuses |
| JEL: | J1 Z0 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2009-023&r=his |