|
on Business, Economic and Financial History |
|
Issue of 2016‒08‒21
fourteen papers chosen by |
| By: | Alejandra Irigoin |
| Abstract: | The essay examines Spain’s colonial legacy in the long-run development of Spanish America. It surveys the fiscal and constitutional outcomes of independence and assesses the relative burden imposed by colonialism. Constitutional asymmetries between revenue collecting and spending agents constrained de facto governments’ power to tax. Inherent disparities embedded in the colonial fiscal system worsened with vaguely defined representation for subjects and territories and vexed their aggregation into a modern representative polity. Governments with limited fiscal capacity failed to deliver public goods and to distribute the costs and benefits of independence equitably. Growing indirect taxes, debt and money creation allowed them to transfer the fiscal burden to other constituents or future generations. Taxpayers became aware of the asymmetry between private contributions and public goods and hence favoured a low but regressive taxation. Comparisons with trajectories in the metropolis and the United States are offered to qualify this legacy. |
| Keywords: | colonial legacy; institutions; long-run development; Spanish America; Spain; US |
| JEL: | N1 N16 N2 N20 N4 N40 |
| Date: | 2016–06–13 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:67384&r=his |
| By: | Carlson, Mark A.; Wheelock, David C. (Board of Governors of the Federal Reserve System (U.S.)) |
| Abstract: | As a result of legal restrictions on branch banking, an extensive interbank system developed in the United States during the 19th century to facilitate interregional payments and flows of liquidity and credit. Vast sums moved through the interbank system to meet seasonal and other demands, but the system also transmitted shocks during banking panics. The Federal Reserve was established in 1914 to reduce reliance on the interbank market and correct other defects that caused banking system instability. Drawing on recent theoretical work on interbank networks, we examine how the Fed’s establishment affected the system’s resilience to solvency and liquidity shocks and whether these shocks might have been contagious. We find that the interbank system became more resilient to solvency shocks but less resilient to liquidity shocks as banks sharply reduced their liquidity after the Fed’s founding. The industry’s response illustrates how the introduction of a lender of last resort can alter private behavior in a way that increases the likelihood that the lender will be needed. |
| Keywords: | Federal Reserve System; Contagion; Systemic risk; Seasonal liquidity demand; Interbank networks; Banking panics; National Banking system |
| JEL: | E42 E44 E58 G21 N11 N12 N21 N22 |
| Date: | 2016–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2016-59&r=his |
| By: | Alexandra M. de Pleijt; Jan Luiten van Zanden; Sarah Guilland Carmichael |
| Abstract: | This paper develops an interrelated set of hypotheses about the links between gender relations, family systems and economic development in EurAsia. Firstly, we briefly discuss a number of ideas from the recent literature about the links between gender relations and economic development. Secondly, we suggest a measure of historic gender relations via the classification and measurement of historical family systems, and offer a set of maps of the institutions concerning marriage, inheritance and family formation that determine the degree of agency that women enjoyed at the micro level. Thirdly, we discuss the possible explanation of the genesis of the EurAsian pattern in family systems and gender relations as a by-product of the spread of agriculture and the process of ancient state formation that followed the Neolithic Revolution 10,000 years ago. Finally, we link these patterns in family systems and female agency to economic growth after 1500. We empirically demonstrate that high female agency was related to per capita GDP between 1800 and 2000. The Ôreversal of fortuneÕ that happened within EurAsia between 1000 and 2000, whereby the ancient centers of state formation and urbanization in the Middle East, India and China were overtaken by regions at the margin of the continent (Western Europe, Japan, Korea), can in our view be linked to this spatial pattern in gender relations and family systems found there (and reconstructed here). |
| Keywords: | Female agency, Economic growth, Family systems, Reversal of fortune. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:ucg:wpaper:0079&r=his |
| By: | Brainerd, Elizabeth (Brandeis University) |
| Abstract: | How does a shock to sex ratios affect marriage markets and fertility? I use the drastic change in sex ratios caused by World War II to identify the effects of unbalanced sex ratios on Russian women. Using unique data from the Soviet archives, the results indicate that male scarcity led to lower rates of marriage and fertility, higher nonmarital births and reduced bargaining power within marriage for women most affected by war deaths. The impact of sex ratio imbalance on marriage and family persisted for years after the war's end, and was likely magnified by policies that promoted nonmarital births and discouraged divorce. |
| Keywords: | sex ratios, marriage, family, fertility, divorce law |
| JEL: | J12 J16 N34 P23 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10130&r=his |
| By: | Auke Rijpma |
| Abstract: | This paper provides a overview of developments in wellbeing in the world since 1820 using seven indicators. To this end, a composite indicator is constructed using a latent variable model able to deal well with missing data and measurement error issues. Overall, this composite indicator gives an optimistic, if divergent picture of developments in wellbeing. Wellbeing increased substantially in most regions of the world since at least the early twentieth century. At the same time, the divergence of Western Europe and its offshoots with the rest of the world in the nineteenth century is stronger. Convergence in the past decades, however, is also more pronounced. In more recent decades, low-income countries have made more progress in the composite indicator than in per capita GDP. The composite indicator also shows a segmented relation with income, suggesting diminishing returns to income. Improvements in wellbeing indicators over time exogenous to GDP and country-specific characteristics were an important part of this. |
| Keywords: | wellbeing, long-term economic growth, economic history |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:ucg:wpaper:0078&r=his |
| By: | Anna Valero; John Van Reenen |
| Abstract: | We develop a new dataset using UNESCO source materials on the location of nearly 15,000 universities in about 1,500 regions across 78 countries, some dating back to the 11th Century. We estimate fixed effects models at the sub-national level between 1950 and 2010 and find that increases in the number of universities are positively associated with future growth of GDP per capita (and this relationship is robust to controlling for a host of observables, as well as unobserved regional trends). Our estimates imply that doubling the number of universities per capita is associated with 4% higher future GDP per capita. Furthermore, there appear to be positive spillover effects from universities to geographically close neighboring regions. We show that the relationship between growth and universities is not simply driven by the direct expenditures of the university, its staff and students. Part of the effect of universities on growth is mediated through an increased supply of human capital and greater innovation (although the magnitudes are not large). We find that within countries, higher historical university presence is associated with stronger pro-democratic attitudes. |
| JEL: | I23 I25 J24 O10 O31 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22501&r=his |
| By: | Glauber, Joseph W.; Effland, Anne |
| Abstract: | This paper examines the development of US agricultural policy and considers how it has affected US consumers and producers, as well as how US programs affect foreign producers and consumers within the context of the United States’ obligations under the World Trade Organization. Throughout its history, the United States has supported the farm sector through a myriad of policies affecting prices, production, and farm incomes. Although many of the policies put in place during the New Deal legislation in the 1930s were seen as temporary at the time, most have persisted in one form or another to the present day. And while many would argue that the form and function of today’s agricultural programs are less distortionary than before, the level of support provided to the sector is several billion dollars annually. |
| Keywords: | UNITED STATES, NORTH AMERICA, agricultural policies, crop insurance, agricultural insurance, subsidies, World Trade Organization (WTO), trade, farm bill, |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1543&r=his |
| By: | Yang Hu (University of Waikato); Les Oxley (University of Waikato) |
| Abstract: | It has been argued that house prices may exhibit a period of bubbles and that they may also be either a cause or an effect of, for example, the Global Financial Crisis (GFC). In this paper, we test econometrically whether house price bubbles have historical precedents and also whether contagion from other financial crises are mirrored in these housing markets. We apply the generalized sup ADF (GSADF) test based procedure of Phillips, Shi, and Yu (2015a) to test for the evidence of exuberance or bubbles in historical housing price indices for the Herengracht index of Amsterdam (1649-2010), Norway (1819-2014) and Paris (1650-2012) based upon the right-tailed unit root null hypothesis with or without an intercept. We find, firstly, there is little evidence of exuberance in the real Herengracht index or of bubbles in the house price-rent ratio for Amsterdam. Secondly, our empirical results provide evidence of exuberance in Norwegian house prices where our identified episodes coincide with the major financial crisis in Norwegian history. Thirdly, no significant evidence of exuberance is found in the historical house price series of Paris under most model specifications. |
| Keywords: | bubbles; generalized sup ADF test; exuberance; house prices; herengracht index; Amsterdam; Norway; Paris |
| JEL: | G01 N20 N90 R30 |
| Date: | 2016–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:wai:econwp:16/08&r=his |
| By: | Montes-Solla, Paulino; Faiña Medín, J. Andres; Lopez-Rodriguez, Jesus |
| Abstract: | This paper analyses the different factors that explain the pattern of economic growth in Spain along the 1989-2010 period. The results of our analysis provide strong evidence of stagnation in productivity throughout most of the period under study. The large investments and the strong growth in capital stocks were practically absorbed by an intense process of job creation. As a consequence, the capital/labour ratio and labour productivity levels had a very low growth, whereas total factor productivity (TFP) decreased over the period of analysis. Therefore unlike other European countries, Spain did not experience a phenomenon of capital deepening with an increase in productivity. The intense GDP pc growth in Spain was of a rather "extensive" type, mainly based on a capital widening process. |
| Keywords: | Regional development, Infrastructures, Capital widening, Productivity stagnation, Total Factor Productivity |
| JEL: | R10 R11 R12 R13 R14 |
| Date: | 2015–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:72921&r=his |
| By: | Raul V. Fabella (School of Economics, University of the Philippines Diliman; National Academy of Science and Technology) |
| Abstract: | The economic catch-up of the East Asian miracle economies went hand-in-hand with the emergence and even dominance of large private or quasi-state business groups such as the Zaibatsus in the pre-WWII and the Keiretsus of the post-WWII Japan, the Chaebols of South Korea and the Taipan-led business empires of South and South East Asia. The dominance of the so-called Robber Barons in the Gilded Age of the USA catch-up era (1870-1900) was of the same genre. The natural vent for size among firms, following the Williamson make or buy logic, manifests itself as vertical integration in large economies; in small economies, it manifests itself as horizontal integration or conglomeracy. The motivations are underdeveloped factor mainly capital and insurance markets. Weak public ordering also motivates size as firms to vertically integrate into private ordering to resist official and unofficial predation. Conglopolistic competition, the competition among conglomerates in many markets, is largely in the non-traded goods sectors where foreign competition is not felt and market saturation is quickly attained. We give show how conglopolistic competition is welfare-improving and give examples of how it boosts the collective action capacity of the weak Philippine state. The dynamism of the Philippine Service sector is due to lively conglopolistic competition which in turn comes from relatively free entry (apart from large capital cost) in these sectors. It is imperative to attract conglopolistic competition in the traded goods sector especially in industrial agriculture. We identify fragmentation of farm land and the 5-hectare ownership ceiling as the one barrier preventing the entry of conglopolistic competition in agriculture. |
| Keywords: | Conglomerates, horizontal integration, small emerging markets, conglopolism, non-traded goods sector |
| JEL: | L22 L25 |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:phs:dpaper:201605&r=his |
| By: | Stephen E. Spear; Warren Young (Bar-Ilan University) |
| Abstract: | In previous papers (Spear and Young 2014, 2015a, 2015b), we surveyed the origins, evolution and dissemination of optimal growth, two sector and turnpike, and stochastic growth models. In this paper, we focus on endogenous growth theory and models. However, in contrast to our previous findings regarding optimal growth theory and its offshoots, which exhibited fairly direct lines of conceptual development, the endogenous growth story, as will be seen, is multifaceted, with a more complex pattern of intellectual evolution. |
| Date: | 2016–05 |
| URL: | http://d.repec.org/n?u=RePEc:biu:wpaper:2016-02&r=his |
| By: | Heise, Arne |
| Abstract: | Walras' law is central to the formation of economic theory. For mainstream economics, it is a device for testing rigorousness and consistency of model-building; for heterodox economists, the refutation of Walras' law is key to understanding Keynes' revolutionary contribution to a new economic paradigm. The purpose of this short research note is to elaborate on the possibility of a refutation of Walras' law and to inquire into its preconditions. It will be argued that this can only be achieved on the basis of an alternative pre-analytic vision of a genuine monetary economy as forshadowed by John Maynard Keynes. |
| Keywords: | Walras' law,equilibrium,disequilibrium,heterodoxy,orthodoxy |
| JEL: | B50 D50 D51 E |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cessdp:54&r=his |
| By: | Oberländer, L.; Disdier, A-C.; Etilé, F. |
| Abstract: | This paper estimates the effect of globalisation on nutritional composition of the diet and health outcomes using a panel dataset of 70 countries spanning 42 years (1970-2011). Our key methodological contribution is the application of the grouped fixed effects estimator developed by Bonhomme and Manresa (2015), which enables us to better control for unobserved time-varying heterogeneity. Our results indicate that a one standard deviation increase in the index of social globalisation is associated with an increase in the share of animal protein of about 12%. In contrast, economic globalisation has no effect on the composition of the diet. Moreover, we do not find significant effects on diabetes prevalence or mean Body Mass Index. Our findings indicate that social aspects of globalisation, such as food advertising, deserve greater attention in the nutrition transition discourse. |
| Keywords: | nutrition transition; globalisation; overweight; grouped fixed effects; |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:16/18&r=his |
| By: | -, Dr S Saravanan; -, Dr V Mohanasundaram |
| Abstract: | Bt Cotton, is genetically engineered with Bt (Bacillus thuringiensis), a bio-toxin which comes from soil bacterium. Bt which was isolated from soil in 1911, has been available to farmers as an organic pesticide since 1930..The engineered Bt gene produces a protein that cuts into the guts of specific insects, rendering the cotton resistant to these insects. Biotechnology for control of bollworms is made available in the seed itself. Farmers have to just sow the Bt cotton seeds as they do with conventional seeds. The resulting plants have the in-built ability to produce Bt protein within their body and defend themselves from bollworms. No extra efforts or equipment are needed to utilize this technology. But after the introduction of Bt cotton it brought into focus a variety of issues like economic, environmental and health and it has a controversy against to adopt it. Hence, the present study focused on the above issues. |
| Keywords: | Bt Cotton, Environment, Health, Economic |
| JEL: | Q16 |
| Date: | 2016–08–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:73107&r=his |