|
on Business, Economic and Financial History |
|
Issue of 2020‒08‒17
fifty-five papers chosen by |
| By: | Barry J. Eichengreen; Asmaa A ElGanainy; Rui Pedro Esteves; Kris James Mitchener |
| Abstract: | We consider public debt from a long-term historical perspective, showing how the purposes for which governments borrow have evolved over time. Periods when debt-to-GDP ratios rose explosively as a result of wars, depressions and financial crises also have a long history. Many of these episodes resulted in debt-management problems resolved through debasements and restructurings. Less widely appreciated are successful debt consolidation episodes, instances in which governments inheriting heavy debts ran primary surpluses for long periods in order to reduce those burdens to sustainable levels. We analyze the economic and political circumstances that made these successful debt consolidation episodes possible. |
| Keywords: | Sovereign debt;External debt;Public debt;Debt burden;Cost of living;National income;Financial crises;Economic integration;Economic growth;Soveriegn Debt,Debt History,Soveriegn Debt Crises,Sovereign Debt Composition,General,International,or Comparative,th century,debt ratio,Rogoff,advanced economy,SFA |
| Date: | 2019–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2019/006&r=all |
| By: | Johannes Wiegand |
| Abstract: | In 1871-73, newly unified Germany adopted the gold standard, replacing the silver-based currencies that had been prevalent in most German states until then. The reform sparked a series of steps in other countries that ultimately ended global bimetallism, i.e., a near-universal fixed exchange rate system in which (mostly) France stabilized the exchange value between gold and silver currencies. As a result, silver currencies depreciated sharply, and severe deflation ensued in the gold block. Why did Germany switch to gold and set the train of destructive events in motion? Both a review of the contemporaneous debate and statistical evidence suggest that it acted preemptively: the Australian and Californian gold discoveries of around 1850 had greatly increased the global supply of gold. By the mid-1860s, gold threatened to crowd out silver money in France, which would have severed the link between gold and silver currencies. Without reform, Germany would thus have risked exclusion from the fixed exchange rate system that tied together the major industrial economies. Reform required French accommodation, however. Victory in the Franco-Prussian war of 1870/71 allowed Germany to force accommodation, but only until France settled the war indemnity and regained sovereignty in late 1873. In this situation, switching to gold was superior to adopting bimetallism, as it prevented France from derailing Germany’s reform ex-post. |
| Keywords: | Currency reform;Fixed exchange rates;Exchange rate regimes;Currency question;Gold;Bimetallism,Gold Standard,France,Germany,Flandreau,specie,silver specie,gold currency |
| Date: | 2019–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2019/032&r=all |
| By: | Marco Gallegati (Department of Economics and Social Sciences, Universita' Politecnica delle Marche (Italy)); Massimo Tamberi (Department of Economics and Social Sciences, Universita' Politecnica delle Marche (Italy)) |
| Abstract: | Using an international historical perspective this study aims at identifying the main empirical regularities, as well as countries' similarities and differences, in the long-run growth pattern of government expenditure, in order to distinguish among existing, competing theories of government growth. The application of nonparametric and parametric analyses to a sample of developed countries observed over the 1880-2011 period allows us to detect two main findings. The first is that, beyond the long-term growth of government expenditures in absolute terms, there is evidence of three expansionary long waves corresponding to the pre-armament booms in the WWs periods and the "golden age of public sector intervention". The latter is the reduction of the degree of cross-country heterogeneity in the pattern of relative and absolute growth of government expenditure since the 1960s. The "ratchet phenomenon" in the pre-WWII period and the change of the prevailing ideology from market failures to government failures in the more recent period provide explanations complementary to Wagner's law and consistent with the observed long-term evolution of the relative (and absolute) growth of government expenditure. |
| Keywords: | Keywords: Wagner's Law, Government expenditures, Local nonparametric regression analysis, Cointegration test |
| JEL: | C14 C22 E60 H50 H60 N40 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:447&r=all |
| By: | Frankema, Ewout; Van Waijenburg, Marlous |
| Abstract: | While human capital has gained prominence in new vintages of growth theory, economists have struggled to find the positive externalities of mass education in developing economies. We shed new light on the economic significance of the global 'schooling revolution' by looking at a different indicator of human capital accumulation - the relative price of skilled labor -, and placing it in a long-term global perspective. Based on a new wage dataset we constructed for various blue- and white-collar occupations in 50 African and Asian countries between 1870-2010, we reveal that skill-premiums have fallen dramatically everywhere in the course of the 20th century, and that they have now converged with levels that dominated in the West already for centuries. While such a 'great convergence' in skill-premiums is not a sufficient condition for Schumpeterian growth by itself, the growing availability of affordable skills is a necessary condition. Our findings, therefore, shed a more optimistic light on the long-term economic gains of mass education in the global South than standard growth regressions have hitherto done. |
| Keywords: | Africa; Asia; History; mass education; skill premium |
| JEL: | J24 J31 N30 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14150&r=all |
| By: | Jean Daniel Boyer; Magali Jaoul-Grammare; Sylvie Rivot |
| Abstract: | Labrousse’s two investigations of cereal price movements (Labrousse 1933, 1944) suggest a sort of dualism in the arguments put forward in the two works (Morineau, 1966). Using contemporary data analysis and cliometrics, we propose to test different hypotheses that emerge from our reading of Labrousse (1933 and 1944). The first set of hypotheses relates to the long-term movement of grain prices. The second type of hypothesis relates to price cycles and price volatility. The originality of our approach in part relates to the very long runs of data drawn from different sources. Results of our study of the wheat price evolution partially questions Labrousse’s analysis. |
| Keywords: | intercycle, Labrousse, volatility, wheat price. |
| JEL: | B11 N13 N33 N53 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2020-30&r=all |
| By: | , Stone Center (The Graduate Center/CUNY); Yonzan, Nishant |
| Abstract: | Labor income inequality among couples has increased by 33 percent in the U.S. over the past half-century. Over the same period, the correlation of labor income within couples has also increased sharply. Is this increase in sorting over labor income a cause for the rise of labor income inequality among couples? Using the March supplement of the CPS, first, I find that there has been a sharp increase in positive sorting over labor income in the U.S. in the 1970-2018 period. The top decile of men’s earners married to the top decile of women’s earners has doubled from 10.6 percent in 1970 to 23.3 percent in 2018. Second, I use a bounded copula framework as a reference distribution to track the relative changes in labor income inequality among couples. Using this framework, I find that positive sorting over labor income did play a role in increasing labor income inequality among couples in the 1970-1990 period; however, I find little evidence to suggest that this relationship existed in the 1990-2018 period. (Stone Center Working Paper Series) |
| Date: | 2020–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:4whvs&r=all |
| By: | Jeremy Atack; Robert A. Margo; Paul Rhode |
| Abstract: | During the nineteenth century, the US manufacturing sector shifted away from the “hand labor” mode of production, characteristic of artisan shops, to the “machine labor” of the factory. This was the focus of an extremely detailed but extraordinarily complex study by the Commissioner of Labor published in 1899 that has until now defied systematic analysis. Here, we explore the overall productivity gains associated with these changes in production methods and the specific, causal role of inanimate power. Under the machine labor mode, the time necessary to complete production tasks declined by 85 percent, a remarkable gain in labor productivity. We also present OLS and IV estimates of the effects of using inanimate power, such as steam, at the production operation level Our IV is based on the gerunds describing the various production activities. Treating our IV estimates as causal, about one-third of the higher productivity of machine labor is attributed to greater use of inanimate power per se. |
| JEL: | N61 O14 O33 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27436&r=all |
| By: | Rei, Clauda (University of Warwick) |
| Abstract: | The rise of the modern state in Western Europe, saw the emergence of national identities in the nineteenth century. This paper evaluates the association between historical religious and state capacity in Portugal proxied by priests and postmen in 1875, and current measures of national identity proxied by voter turnout in democratic elections from 1975 to 2017. I find that places with a stronger historical presence of postmen vote more in any election, but they vote less in local elections relative to national elections. This result suggests a persistent association of historical state presence with national identity. Historical religious presence is also positively associated with voter turnout but in smaller magnitude. There is however no negative association with local elections: in contrast with historical state capacity, historical religious capacity is connected with the local rather than the national unit. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:1291&r=all |
| By: | Filippo Gusella |
| Abstract: | Thomas Piketty’s Capital in the Twenty-First Century is primarily an empirical investigation into the history of the distribution of income and wealth in developed countries. Piketty, however, goes beyond this approach, presenting a theory of the long-run tendency of wealth inequality and rooting his work deeply in economic theory. In this paper we review and develop the theoretical model of Piketty’s book. We can divide the model into two parts: firstly, the "fundamental laws of capitalism" and the change in the functional distribution of income are analysed. Secondly, the evolution of personal wealth distribution is examined. Alongside the development of the model, the paper points out two shortcomings. We show the contradiction of the original model in explaining the increase of the capital/income ratio with the change in the functional distribution of income. Moreover, we highlight the inconsistency between the definition of capital and the model proposed. The paper concludes by outlining alternative approaches to the problem, calling for a major rethinking about the causes of rising wealth inequality. |
| Keywords: | Piketty; economic inequality; fundamental laws of capitalism; functional distribution of income; economic growth |
| JEL: | D31 E25 P10 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:830&r=all |
| By: | Henriques, Antonio; Palma, Nuno Pedro G. |
| Abstract: | Why did the countries which first benefited from access to the New World -- Castile and Portugal -- decline relative to their followers, especially England and the Netherlands? The dominant narrative is that worse initial institutions at the time of the opening of Atlantic trade explain Iberian divergence. In this paper, we build a new dataset which allows for a comparison of institutional quality over time. We consider the frequency and nature of parliamentary meetings, the frequency and intensity of extraordinary taxation and coin debasement, and real interest spreads for public debt. We find no evidence that the political institutions of Iberia were worse until at least the English Civil War. |
| Keywords: | Atlantic Traders; New Institutional Economics; the Little Divergence |
| JEL: | N13 N23 O10 P14 P16 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14124&r=all |
| By: | Kenneth D. Garbade |
| Abstract: | This paper examines the evolution of the maturity structure of marketable Treasury debt from 1953 to 1983. Average maturity contracted erratically from 1953 to 1960, expanded through mid-1965, contracted again through late 1975, and then expanded into the early 1980s. What accounts for these broad trends? In particular, what were the maturity objectives of Treasury debt managers? Were they able to achieve their objectives? Why or why not? |
| Keywords: | Treasury debt management; maturity structure of debt; advance refundings |
| JEL: | G28 H63 N22 |
| Date: | 2020–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:88464&r=all |
| By: | Olivier Cabrignac (SCOR, 5 Avenue Kléber, 75795 Paris, France); Arthur Charpentier (Université du Québec à Montréal (UQÀM), 201, avenue du Président-Kennedy, Montréal (Québec), H2X 3Y7, Canada); Ewen Gallic (Aix-Marseille Univ, CNRS, EHESS, Ecole Centrale, AMSE, Marseille, France.) |
| Abstract: | Family history is usually seen as a significant factor insurance companies look at when applying for a life insurance policy. Where it is used, family history of cardiovascular diseases, death by cancer, or family history of high blood pressure and diabetes could result in higher premiums or no coverage at all. In this article, we use massive (historical) data to study dependencies between life length within families. If joint life contracts (between a husband and a wife) have been long studied in actuarial literature, little is known about child and parents dependencies. We illustrate those dependencies using 19th century family trees in France, and quantify implications in annuities computations. For parents and children, we observe a modest but significant positive association between life lengths. It yields different estimates for remaining life expectancy, present values of annuities, or whole life insurance guarantee, given information about the parents (such as the number of parents alive). A similar but weaker pattern is observed when using information on grandparents. |
| Keywords: | annuities; collaborative data; dependence; family history; genealogy; grandparents-grandchildren; information; joint life insurance; parents-children; whole life insurance |
| JEL: | C13 C18 C46 C55 J11 J12 G22 G32 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2021&r=all |
| By: | Samuel Bazzi (Boston University); Gabriel Koehler-Derrick (Harvard University); Benjamin Marx (Département d'économie) |
| Abstract: | Why do religious politics thrive in some societies but not others? This paper explores the institutional foundations of this process in Indonesia, the world’s largest Muslim democracy. We show that a major Islamic institution, the waqf, fostered the entrenchment of political Islam at a critical historical juncture. In the early 1960s, rural elites transferred large amounts of land into waqf —a type of inalienable charitable trust—to avoid expropriation by the government as part of a major land reform effort. Although the land reform was later undone, the waqf properties remained. We show that greater intensity of the planned reform led to more prevalent waqf land and Islamic institutions endowed as such, including religious schools, which are strongholds of the Islamist movement. We identify lasting effects of the reform on electoral support for Islamist parties, preferences for religious candidates, and the adoption of Islamic legal regulations (sharia). Overall, the land reform contributed to the resilience and eventual rise of political Islam by helping to spread religious institutions, thereby solidifying the alliance between local elites and Islamist groups. These findings shed new light on how religious institutions may shape politics in modern democracies. |
| Keywords: | Religion; Institutions; Land reform; Islam; Sharia Law |
| JEL: | D72 D74 P16 P26 Z12 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/68bdjcjoob8kh8nu5vcmetkbf3&r=all |
| By: | Rishabh Kumar (CSUSB - California State University [San Bernardino]) |
| Abstract: | This article is about the metamorphoses of aggregate Indian wealth over fifteen politically transformative decades. Based on a comprehensive new database, I find that wealth-income ratios have fluctuated by large margins in the twentieth century. In emerging India of the twenty first century, wealth is steadily approaching the same disproportionate size (relative to national income) that was seen during sharp economic downturns in interwar colonial India. The long run 1939-2012 U shaped trajectories of wealth-income ratios are reasonably explained by a mid century asset price slowdown and the return of high land shares in national wealth. These results corroborate the secular increase of wealth-income ratios in most large economies since the 1980s. The manifestation of this phenomena appears to be independent of the stage of development. |
| Keywords: | wealth-income ratios,India,Economic growth,Wealth-Income ratio,National wealth,Inequality,Land values |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02876998&r=all |
| By: | Claudio Ferraz; Frederico Finan; Monica Martinez-Bravo |
| Abstract: | This paper analyzes how changes in the concentration of political power affect long-run development. We study Brazil’s military dictatorship whose rise to power dramatically altered the distribution of power of local political elites. We document that municipalities that were more politically concentrated prior to the dictatorship in the 1960s are relatively richer in 2000, despite being poorer initially. Our evidence suggests that this reversal of fortune was the result of the military’s policies aimed at undermining the power of traditional elites. These policies increased political competition locally, which ultimately led to better governance, more public goods, and higher income levels. |
| JEL: | D72 N46 O43 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27456&r=all |
| By: | Knutsson, Daniel (Research Institute of Industrial Economics (IFN)) |
| Abstract: | There is debate among researchers regarding the importance of water filtration in reducing mortality during the epidemiological transition. However, there is limited research on how water filtration affected cholera mortality during the second half of the 19th century. Using historical microdata, this paper provides new evidence on the importance of water filtration in reducing cholera mortality during an outbreak. The results show that access to filtered water protected almost completely against cholera mortality. Water filtration could thereby have contributed more to mortality decline than what has previously been documented. |
| Keywords: | Water; Piped water; Filtered water; Cholera; Mortality; Public health |
| JEL: | H51 I11 I18 N30 |
| Date: | 2020–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1346&r=all |
| By: | Kevin L. Kliesen; David C. Wheelock |
| Abstract: | In October 1979, Federal Reserve Chairman Paul Volcker persuaded his FOMC colleagues to adopt a new policy framework that i) accepted responsibility for controlling inflation and ii) implemented new operating procedures to control the growth of monetary aggregates in an effort to restore price stability. These moves were strongly supported by monetarist-oriented economists, including the leadership and staff of the Federal Reserve Bank of St. Louis. The next three years saw inflation peak and then fall sharply, but also two recessions and considerable volatility in interest rates and money supply growth rates. This article reviews the episode through the lens of speeches and FOMC meeting statements of Volcker and St. Louis Fed president Lawrence Roos, and articles by Roos’ staff. The FOMC adopted monetarist principles to establish the Fed’s anti-inflation credibility but Volcker was willing to accept deviations of money growth from the FOMC’s targets, unlike Roos, who viewed the targets as sacrosanct. The FOMC abandoned monetary aggregates in October 1982, but preserved the Fed’s commitment to price stability. The episode illustrates how Volcker used a change in operating procedures to alter policy fundamentally, and later adapt the procedures to changed circumstances without abandoning the foundational features of the policy. |
| Keywords: | monetarism; inflation; money supply; Federal Open Market Committee; monetary policy; recession |
| JEL: | E42 E52 E58 N22 |
| Date: | 2020–07–23 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:88437&r=all |
| By: | Maximiliano Presa (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Carolina Román (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía) |
| Abstract: | This study provides estimates of food consumption of the main food items of the Uruguayan economy from the beginning of the 20th century to the 1970. We elaborate apparent consumption series of the main food products of the Uruguayan households’ basket, using the commodity flow approach and the food balance sheet methodology. The sample of chosen items has an important weight in the households’ budget and includes the most important foods in term of nutrients and calories to the daily intakes: meat (bovine, ovine and porcine), wheat flour and wheat products, milk, potatoes and sweet potatoes. The paper has a strong methodological as it concentrates on the elaboration of annual series in physical which allow calculating levels of consumption per capita and its evolution over the period studied. |
| Keywords: | food consumption, commodity flow approach, Uruguay |
| JEL: | N56 N36 |
| Date: | 2020–03 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-03-20&r=all |
| By: | Christopher Paik; Lisa Blaydes (Division of Social Science) |
| Abstract: | The Silk Roads stretched across Eurasia, connecting East and West for centuries. At its height, the network of trade routes enabled merchants to travel from China to the Mediterranean Sea, carrying with them high-value commercial goods, the exchange of which encouraged urban growth and prosperity. We examine the extent to which urban centers thrived or withered as a function of shocks to trade routes, particularly political fragmentation along natural travel paths. We find that political fragmentation along the roads to Aleppo and historic Chang'an - major terminus locations for cross-regional trade - damaged city growth. These conclusions contribute to our understanding of how a pre-modern international system operated through an examination of exchange between the two most developed world regions of the medieval and early modern periods, China and the Muslim East. |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:nad:wpaper:20190033&r=all |
| By: | Fenske, James (University of Warwick); Gupta, Bishnupriya (University of Warwick); Yuan, Song (University of Warwick) |
| Abstract: | How did the 1918 inuenza pandemic affect female labor force participation in India over the short run and the medium run? We use an event-study approach at the district level and four waves of decadal census data in order to answer this question. We find that districts most adversely affected by influenza mortality saw a temporary increase in female labor force participation in 1921, an increase that was concentrated in the service sector. By 1931, this increase had been reversed. We find suggestive evidence that distress labor supply by widows and rising wages help account for these results. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:1286&r=all |
| By: | Réka Juhász; Mara P. Squicciarini; Nico Voigtländer |
| Abstract: | We construct a novel dataset to examine the process of technology adoption during a period of rapid technological change: The diffusion of mechanized cotton spinning during the Industrial Revolution in France. Before mechanization, cotton spinning was performed in households, while production in firms only emerged with the new technology around 1800. This allows us to isolate the firm productivity distribution of new technology adopters. We document several stylized facts that can explain the well-documented puzzle that major technological breakthroughs tend to be adopted slowly across firms and – even after being adopted – take time to be reflected in higher aggregate productivity: The productivity of firms in mechanized cotton spinning was initially highly dispersed. Over the subsequent decades, cotton spinning experienced dramatic productivity growth that was almost entirely driven by a disappearance of firms in the lower tail. In contrast, innovations in other sectors (with gradual technological progress) shifted the whole productivity distribution. We document rich historical and empirical evidence suggesting that the pattern in cotton spinning was driven by the need to re-organize production under the new technology. This process of ‘trial and error’ led to widely dispersed initial productivity draws, low initial average productivity, and – in the subsequent decades – to high productivity growth as new entrants adopted improved methods of production and organization. |
| JEL: | F63 N23 O14 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27503&r=all |
| By: | Carl T. Kitchens; Luke P. Rodgers |
| Abstract: | Using variation in crop prices induced by large swings in demand World War I, we examine the fertility response to increases in crop revenues during the period 1910-1930. Our estimates from samples utilizing both complete count decennial census microdata and newly collected county-level data from state health reports indicate that a doubling of the agricultural price index reduced fertility by around 8 percent both immediately and in the years following the boom. We further document that this effect was more pronounced in more agrarian areas and where the labor intensity of agriculture was more intense. Extensive robustness checks and analysis of potential mechanisms indicate that the decrease in fertility was driven by increased female opportunity costs which dominated any household income effects resulting from the price boom. |
| JEL: | J12 J13 N12 N5 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27530&r=all |
| By: | Greenwood, Jeremy; Guner, Nezih; Kopecky, Karen A. |
| Abstract: | The 19th and 20th centuries saw a transformation in contraceptive technologies and their take up. This led to a sexual revolution, which witnessed a rise in premarital sex and out-of-wedlock births, and a decline in marriage. The impact of contraception on married and single life is analyzed here both theoretically and quantitatively. The analysis is conducted using a model where people search for partners. Upon finding one, they can choose between abstinence, marriage, and a premarital sexual relationship. The model is confronted with some stylized facts about premarital sex and marriage over the course of the 20th century. Some economic history is also presented. |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:14110&r=all |
| By: | , Stone Center (The Graduate Center/CUNY); Bleynat, Ingrid; Challú, Amílcar; Segal, Paul |
| Abstract: | Historical wage and incomes data are informative both as normative measures of living standards, and as indicators of patterns of economic development. We show that, given limited historical data, median incomes are most appropriate for measuring welfare and inequality, while urban unskilled wages can be used to test dualist models of development. We present a new dataset including both series in Mexico from 1800 to 2015 and find that both have historically failed to keep up with aggregate growth: per worker GDP is now over eight times higher than in the nineteenth century, while unskilled urban real wages are only 2.2 times higher, and median incomes only 2.0 times. From the perspective of inequality and social welfare, our findings confirm that there is no automatic positive relationship between economic growth and rising living standards for the majority. From the perspective of development, we argue that these findings are consistent with a dual economy model incorporating Lewis’s assumption of a reserve army of labour, and explain why Kuznets’s predicted decline in inequality has not occurred. (Stone Center Working Paper Series) |
| Date: | 2020–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:9ztb7&r=all |
| By: | Li Yang (PSE - Paris School of Economics, WIL - World Inequality Lab); Filip Novokmet (University of Bonn); Branko Milanovic (New York University - NYU - New York University [New York] - NYU - NYU System) |
| Abstract: | Economic and social transformation of China during the past 40 years is without precedent in human history. While the economic transformation was extensively studied, social transformation was not. In this paper, we use for the first time harmonized household surveys covering the period 1988-2013 to study the changes in the characteristics the richest 5 percent of China's urban population. We find that the elite changed from being composed of high government officials, clerical staff, and workers in 1988 to professionals and small and large business owners in 2013. The educational level of the elite increased substantially. Membership in CCP has a positive (albeit small) effect on one's income but is particularly valuable to large business owners. |
| Keywords: | China,elites,income share,class,top incomes |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02876990&r=all |
| By: | Yannay Spitzer; Gaspare Tortorici; Ariell Zimran |
| Abstract: | The Messina-Reggio Calabria Earthquake (1908) was the deadliest earthquake and arguably the most devastating natural disaster in modern European history. It occurred when overseas mass emigration from southern Italy was at its peak and international borders were open, making emigration a widespread phenomenon and a readily available option for disaster relief. We use this singular event and its unique and important context to study the effects of natural disasters on international migration. Using commune-level data on damage and annual emigration, we find that, despite massive destruction, there is no evidence that the earthquake had, on average, a large impact on emigration or its composition. There were, however, heterogeneous and offsetting responses to the shock, with a more positive effect on emigration in districts where agricultural day laborers comprised a larger share of the labor force, suggesting that attachment to the land was an impediment to reacting to the disaster through migration. Nonetheless, relative to the effects of ordinary shocks, such as a recession in the destination, this momentous event had a small impact on emigration rates. These findings contribute to literatures on climate- and disaster-driven migration and on the Age of Mass Migration. |
| JEL: | F22 J61 N33 N53 O13 O15 Q54 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27506&r=all |
| By: | Remi Jedwab (George Washington University); Noel D. Johnson (George Mason University); Mark Koyama (George Mason University) |
| Abstract: | We draw on theories and empirical findings from urban economics to explore and explain patterns of city growth in the Middle Ages (c. 800-1500 CE). We discuss how agricultural development and physical geography determined the location and size of cities during the medieval period. We also consider the relative importance of economies of scale, agglomeration, and human capital spillovers in medieval cities and discuss how their growth was limited by disamenities and constraints on mobility. We discuss how medieval cities responded to shocks such as the Black Death and describe how institutions became increasingly important in determining their trajectories. Avenues for future research are also laid out. |
| Keywords: | Medieval Era, City Growth, Urbanization, Food Surplus Hypothesis, Agglomeration Effects, Labor Mobility, Pandemics, Institutions, Europe, Asia |
| JEL: | R11 R12 R19 N9 N93 N95 |
| Date: | 2020–09 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2020-9&r=all |
| By: | Deodhar, Satish Y. |
| Abstract: | Shukracharya’s treatise on political economy has been referred to in many ancient Indian texts such as the Arthashastra, Buddhacharitam and Mahabharata. However, that treatise has been lost. Fortunately, an abridged version titled Shukranitisara belonging to the early medieval period was discovered in the nineteenth century. While a few have written about Shukranitisara from the perspective of political science, nothing has been written from the perspective of economic policies. Among the four purusharthas or the life objectives, while Arthashastra had given primacy to artha or material wealth, Shukranitisara considers dharmic or ethical conduct as foremost for the economic decisions of the state and the householder. The treatise addresses issues of governance, breadth of vocations and sciences, public finance, prices, markets, contracts, labour relations, and advice to a householder. Quite a few economic policies mentioned in Shukranitisara are detailed and different as compared to Arthashastra, and remain relevant for policymaking even today. |
| Date: | 2020–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:14632&r=all |
| By: | Jean Daniel Boyer (University of Strasbourg, Strasbourg, France); Magali Jaoul-Grammare (University of Strasbourg, Strasbourg, France); Sylvie Rivot (University of Haute-Alsace, France) |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:afc:wpaper:03-20&r=all |
| By: | Horn, Sebastian; Reinhart, Carmen M.; Trebesch, Christoph |
| Abstract: | Official (government-to-government) lending is much larger than commonly known, often surpassing total private cross-border capital flows, especially during disasters such as wars, financial crises and natural catastrophes. We assemble the first comprehensive long-run dataset of official international lending, covering 230,000 loans, grants and guarantees extended by governments, central banks, and multilateral institutions in the period 1790-2015. Historically, wars have been the main catalyst of government-to-government transfers. The scale of official credits granted in and around WW1 and WW2 was particularly large, easily surpassing the scale of total international bailout lending after the 2008 crash. During peacetime, development finance and financial crises are the main drivers of official cross-border finance, with official flows often stepping in when private flows retrench. In line with the predictions of recent theoretical contributions, we find that official lending increases with the degree of economic integration. In crises and disasters, governments help those countries to which they have greater trade and banking exposure, hoping to reduce the collateral damage to their own economies. Since the 2000s, official finance has made a sharp comeback, largely due to the rise of China as an international creditor and the return of central bank cross-border lending in times of stress, this time in the form of swap lines. |
| Keywords: | international capital flows,disaster response,global financial safety net,bail-outs |
| JEL: | E42 F33 F34 F35 F36 G01 G20 N1 N2 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2157&r=all |
| By: | Tiago Miguel Guterres Neves Sequeira (University of Coimbra, Centre for Business and Economics Research, CeBER andFaculty of Economics); Daniel Filipe Videira Murta (University of Coimbra, Centre for Business and Economics,CeBER, Faculty of Economics); Marcelo Serra Santos (CeBER) |
| Abstract: | The literature on development has pointed out some deeply-rooted determinants of current economic development. Most research on the field has been devoted to developing countries or specific to single countries. We focus on deeply-rooted determinants of development of European regions, in particular on the influence of human capital. Following an identification strategy using instrumental variables, we approach the historical links between current human capital and the presence of universities and trade guilds in medieval times. We show that human capital is an important determinant of income disparities across European regions, and that trade guilds and universities at 1500 are good instruments to track the exogenous influence of the current levels of human capital. This finding shows robustness to several econometric specifications. |
| Keywords: | Development, regions, historical determinants of development. |
| JEL: | I25 P16 O10 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:papers:2020-11&r=all |
| By: | Barry R. Chiswick (George Washington University); RaeAnn Halenda Robinson (George Washington) |
| Abstract: | Rates of labor force participation in the US in the second half of the nineteenth century among free women were exceedingly (and implausibly) low, about 11 percent. This is due, in part, to social perceptions of working women, cultural and societal expectations of female’s role, and lack of accurate or thorough enumeration by Census officials. This paper develops an augmented free female labor force participation rate for 1860. It is calculated by identifying free women (age 16 and older) who were likely providing informal and unenumerated labor for market production in support of a family business, that is, unreported family workers. These individuals are identified as not having a reported occupation, but are likely to be working on the basis of the self-employment occupation of other relatives in their households. Family workers are classified into three categories: farm, merchant, and craft. The inclusion of this category of workers more than triples the free female labor force participation rate in the 1860 Census, from 16 percent to 56 percent, which is comparable to today’s rate (57 percent in 2018). |
| Keywords: | Women, Labor Force Participation, Occupational Attainment, Unpaid Workers, Unreported Family Workers, 1860 Census |
| JEL: | N31 J16 J21 J82 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2020-11&r=all |
| By: | Marianna Epicoco (University of Lorraine, Nancy, France); Magali Jaoul-Grammare (University of Strasbourg, Strasbourg, France); Anne Plunket (University Paris Saclay, France) |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:afc:wpaper:04-20&r=all |
| By: | Kabeer, Naila |
| Abstract: | The 2019 Nobel Prize in economics was awarded to three scholars on the grounds that their pioneering use of randomized control trials (RCTs) was innovative methodologically and contributed to development policy and the emergence of a new development economics. Using a critical feminist lens, this article challenges that conclusion by interrogating the storytelling practices deployed by “randomista” economists through a critical reading of a widely cited essay by Esther Duflo, one of the 2019 Nobel recipients, on the relationship between women’s empowerment and economic development. The paper argues that the limitations of randomista economics have given rise to a particular way of thinking characterized by piecemeal analysis, ad hoc resort to theory, indifference to history and context, and methodological fundamentalism. It concludes that the randomista argument that broad-based economic development alone – without focused attention to women’s rights – will lead to gender equality has not been borne out by recent data. |
| Keywords: | empowerment; economic development; development |
| JEL: | J01 |
| Date: | 2020–05–13 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:103880&r=all |
| By: | Alfredo M. Navarro |
| Abstract: | Este trabajo estudia la relación entre la economía, la biología y la teoría de la evolución. Comienza analizando la influencia que tuvieron tanto Malthus como los primeros economistas en el nacimiento de la teoría de la selección natural. Luego pasa revista a la relación inversa, es decir a la transmisión de ideas que corre de la teoría de la evolución hacia el pensamiento económico, para lo que se estudian las ideas de Marshall, Veblen, Hayek y Schumpeter, entre otros. Posteriormente analiza el estado actual de la denominada economía evolucionista, y analizando las contribuciones recientes más importantes, destacando la influencia de las ideas de Schumpeter. Finalmente se realizan algunas reflexiones sobre las cuestiones expuestas. |
| Keywords: | economía evolucionista, selección natural, rutinas |
| JEL: | A12 B15 B41 O30 |
| Date: | 2019–11 |
| URL: | http://d.repec.org/n?u=RePEc:aep:anales:4180&r=all |
| By: | Marcelo Dianessi (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía; Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Gabriela Mordecki (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Maximiliano Presa (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Silvia Rodríguez-Collazo (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Estadística) |
| Abstract: | The performance of the Uruguayan economy over the last decade, in contrast to that of its neighbouring economies, encouraged the decoupling hypothesis. Thus, Uruguay’s GDP growth seems to have moved away from the evidence of previous studies (Lanzilotta et al., 2003) that showed that Uruguay’s growth was in the long run the result of the semi-sum of the growth rates of Argentina and Brazil. This research attempts to answer these questions by applying, for different samples included in the period 1980 to 2018, analysis of cyclical comovements, cointegration analysis, estimation VEC models and impulse response simulations. The results obtained allow us to discard that the long-term relationship expressed as a semi-sum is sustained, when the information is extended until 2018. It is necessary to include relative prices indicators linked to the Brazilian economy within the determinants of Uruguay's GDP trajectory in order to recompose the dynamic long-term relationship that links it to that of its neighbours. This is an indication that Uruguay is stills exposed to regional shocks, but in a somewhat different way than in the past, since the relationship with international prices is also relevant to the long-term relationship. |
| Keywords: | decoupling, regional dependence, cointegration, Uruguay |
| JEL: | C32 F31 F43 |
| Date: | 2020–02 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-01-20&r=all |
| By: | Yuzuru Kumon (Institute of Advanced Studies, Toulouse School of Economics) |
| Abstract: | I use new evidence from servant contracts, 1610-1932, to estimate male farm wages and the length of the work year in Japan. I show Japanese laborers were surprisingly poor and could only sustain 2-3 adults relative to 7 adults for the English. Japanese wages were the lowest among pre-industrial societies and this was driven by Malthusian population pressures. I also estimate the work year and find peasants worked 325 days a year by 1700, predating the "industrious" revolution in Europe. The findings imply Japan had a distinct labor-intensive path to industrialization, utilizing cheap labor over a long work year. |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2020cf1154&r=all |
| By: | Samuel Bazzi (Boston University); Masyhur Hilmy (Boston University (BU)); Benjamin Marx (Département d'économie) |
| Abstract: | Public schooling systems are an essential feature of modern states. These systems often developed at the expense of religious schools, which undertook the bulk of education historically and still cater to large student populations worldwide. This paper examines how Indonesia’s longstanding Islamic school system responded to the construction of 61,000 public elementary schools in the mid-1970s. The policy was designed in part to foster nation building and to curb religious influence in society. We are the first to study the market response to these ideological objectives. Using novel data on Islamic school construction and curriculum, we identify both short-run effects on exposed cohorts as well as dynamic, long-run effects on education markets. While primary enrollment shifted towards state schools, religious education increased on net as Islamic secondary schools absorbed the increased demand for continued education. The Islamic sector not only entered new markets to compete with the state but also increased religious curriculum at newly created schools. Our results suggest that the Islamic sector response increased religiosity at the expense of a secular national identity. Overall, this ideological competition in education undermined the nation-building impacts of mass schooling. |
| JEL: | H52 I25 N45 P16 Z12 |
| Date: | 2020–05 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/3jngk2o32k9hgasm59p1d3tmli&r=all |
| By: | Carlos Sanz (Bank of Spain); Albert Solé-Ollé (University of Barcelona & IEB); Pilar Sorribas-Navarro (University of Barcelona & IEB) |
| Abstract: | We investigate whether corruption amplifies the political effects of economic crises. Using Spanish municipal-level data and a difference-in-difference strategy, we find that local unemployment shocks experienced during the Great Recession (2008-2015) increased political fragmentation. This effect was four times larger in municipalities exposed to malfeasance than in municipalities without a history of political corruption. We bolster this evidence by showing that, conditional on province and population-strata fixed effects, there is no evidence of differential pre-trends. We also find that the interaction of unemployment and corruption harms the two traditional main parties and benefits especially the new party on the left (Podemos). |
| Keywords: | Accountability, Corruption, Political Fragmentation, Economic Crisis |
| JEL: | D72 D73 H12 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2020-02&r=all |
| By: | Hanna Adam |
| Abstract: | This working paper analyses the socioeconomic effects of education in two different political systems by investigating whether individuals educated in a collectivist education system are less likely to become entrepreneurs than individuals educated in an individualist system. It exploits the separation of Vietnam into a communist northern and a capitalist southern part between 1954 and 1975 to identify education in the respective systems, keeping factors such as national culture or historical background fixed. A Probit regression using survey data on 1,164 individuals suggests that being educated in the North makes it 8.6 percent less likely to become an entrepreneur than being educated in the South. This demonstrates that education in different systems may have an effect on entrepreneurial activity, although challenges such as necessity-driven entrepreneurship remain unresolved. |
| Keywords: | Entrepreneurship, Education, Vietnam, Survey data, Probit regression |
| JEL: | L26 N35 O12 P30 R2 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:tvs:wpaper:wp-020&r=all |
| By: | Wiemer Salverda (UvA - University of Amsterdam [Amsterdam]) |
| Abstract: | In 2001 Tony very kindly agreed that we would work together on the top income shares for our two countries, the Netherlands and the UK. I profited enormously from his experience with top incomes and, naturally, with the UK, and, surprisingly, also with my own country. He could actually read Dutch and had much easier access to the pre-war Dutch statistics than I had. He joked about non-existent privacy concerns in the statistics of those days as that highest class of incomes counted one observation only – Tony imagined that would be Henri Deterding, chairman of Royal Dutch Shell up to 1937. I treasure the moments we sat together at Nuffield for work, at the high table, or, equally nicely, in a pub for a beer. With his guidance we successfully laid the basis for the first 85 years (1914-1999), on which I have built for a summary update of Dutch top incomes to the year 2012 (Salverda, 2013) and on which I base myself for the present paper's more extensive update to 2014. Tony has seen most of the new material (compare the Graphs section below) in July 2016 and responded, even on holiday, with some suggestions and questions. He liked chart books, well this is one. It is really very sad that we have not been able to finish this together. He liked the ‘100 years' completion of the series, and anyone who knew him would have wished him a century in good health. |
| Keywords: | Top Incomes,Income Inequality,Wealth Inequality,The Netherlands |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02877004&r=all |
| By: | Kostas Chrissis (Hellenic Statistical Authority); Franciscos Koutentakis (UOC - University of Crete [Heraklion], Hellenic Parliamentary Budget Office) |
| Abstract: | The paper calculates the top income shares in Greece from 1967 (the seizure of power by the military dictatorship) until 2017 (the aftermath of the debt crisis). This long-run perspective allows us to examine the relationship be- tween income distribution and institutional transformations, namely democracy, finance and crisis. We find that the evolution of top income shares broadly corresponds to discrete political and economic arrangements, in particular (a) transition to democracy did not affect the income shares of the top decile, whereas social democracy had a signi_cant negative impact (b) _financial development and liberalization substantially increased the top decile shares (c) debt crisis, consolidation and recession were beneficial for the up- per ranks of the top decile. |
| Keywords: | Greece,top incomes,income distribution,institutional transformations,democracy,finance,crisis,dictatorship |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02876984&r=all |
| By: | Laura A Harvey (University of East Anglia); James Rockey (University of Leicester) |
| Abstract: | While real US GDP per capita has increased around 80% since 1980, median incomes have remained roughly constant. However, as this paper documents, this stagnation masks an important decline. Male median real incomes have been lower than that of their forebears, at every age, for the last 30 years. We show that this is true across the life cycle and across the wage distribution. Moreover, that younger generations have also had to wait longer to reach peak earnings. Further analysis shows that this decline is particularly concentrated on high school graduates. The same pattern is found for female high school graduates yet, African American and Hispanic American women are an important exception. Variance decompositions suggest that these intergenerational differences are quantitatively important. While reductions in hours worked cannot explain the decline, substantial decreases in the labour share are consistent with decreasing incomes in the face of productivity growth. Calculations suggest that hedonic improvements in the quality of goods and services would have to have been equivalent to 30% of lifetime consumption younger cohorts consumption levels to match those of their predecessors. |
| Keywords: | Wages, Intergenerational Differences, Labour Share, Stagnation, Jobs |
| JEL: | E24 J24 J31 D33 D31 |
| Date: | 2020–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:uea:ueaeco:2019_08&r=all |
| By: | Azam, Jean-Paul |
| Abstract: | This paper shows that the two oil shocks that occurred in 1974-85 and 2003-15 inflicted sizable damage to total factor productivity (TFP) in France and Germany. These are resource-poor economies whose firms are importing most of their inputs of extractive commodities. The real prices they pay for them impact directly on their value added and hence on GDP in aggregate. We single out the price of crude oil as the most important and volatile of this set of highly correlated prices. This real price depends both on the world commodity market and on the exchange rates between the US dollar and the relevant European currencies, themselves determined by monetary policy in the US and in Europe. The significance of this mechanism is confirmed econometrically, and its quantitative implications are assessed. On average, these countries have lost more than 1% of potential TFP during these oil shocks, Germany being affected more severely than France. Historical analysis shows that episodes of US dollar appreciation have significant impacts on French and German TFP via this channel. |
| JEL: | N10 N70 O47 N14 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:tse:iastwp:124576&r=all |
| By: | Adriana Lleras-Muney; Joseph Price; Dahai Yue |
| Abstract: | We combine newly released individual data from the 1940 full-count census with death records and other information available in family trees to create the largest individual data to date to study the association between years of schooling and age at death. Conditional on surviving to age 35, one additional year of education is associated with roughly 0.4 more years of life for both men and women for cohorts born 1906-1915. This association is close to linear but exhibits strong credentialing effects, particularly for men, and is substantially smaller for cohorts born earlier. This association varies substantially by state of birth, but it is not smaller in states with higher levels of education or longevity. For men the association is stronger in places with greater incomes, higher quality of school, and larger investments in public health. Women also exhibit great heterogeneity in the association, but our measures of the childhood environment do not explain it. |
| JEL: | I10 I20 J10 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27514&r=all |
| By: | Meredith M. Paker |
| Abstract: | The brief recession from 1980–1981 in the UK led to a prolonged employment downturn, with the unemployment rate continuing to increase through 1984. A large literature has developed around the concept of jobless recoveries and their possible causes, focused primarily on the US from the 1990s. This paper argues that the employment recovery from the 1980–1981 recession in the UK can be considered an early example of a jobless recovery. Then, taking the US as a comparison case, possible causes of this jobless recovery are evaluated. Labor reallocation across industries, regional effects, and job polarization are considered in depth for the UK. Industry labor reallocation emerges as the major difference between the UK and the US during the early 1980s recession and recovery period, suggesting this was the key factor driving the UK’s jobless recovery. |
| Keywords: | jobless recovery; industry labor reallocation; structural change; job polarization |
| JEL: | N14 N34 J64 J21 E24 |
| Date: | 2020–08–07 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:esohwp:_182&r=all |
| By: | Andrew Kerr (DataFirst, University of Cape Town); Bruce McDougall (DataFirst, University of Cape Town) |
| Abstract: | A burgeoning literature in economics uses firm census data to provide explanations for the very large differences in income per capita across countries. Much of this literature takes for granted that the coverage of firm censuses across and within countries is similar. In this paper we use data from four Ghanaian firm censuses conducted between 1962 and 2014 to show that the coverage of each census was very different. Treated as is, the four censuses show dramatic and unbelievable changes in the scale of manufacturing production in Ghana over this period. As a result, we examine and document important changes in what undertaking a “firm census” has meant over 50 years in Ghana, as well as documenting variation in the coverage of firm censuses from several other African countries. We show that it is possible to obtain a believable evolution of the firm size distribution in Ghana over the period for which we have firm microdata, but that this requires substantial work to understand how the coverage of each firm census has varied over time. Our paper shows that the coverage of firm censuses both within and across countries can differ quite dramatically, and that this can impact research that uses firm census data. |
| Keywords: | firm census, developing countries, Ghana |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ldr:wpaper:262&r=all |
| By: | Jonathan Chapman (Division of Social Science) |
| Abstract: | This paper develops a model predicting that the extent of the franchise has an inverted-U-relationship with government expenditure on public goods. Extending the right to vote from the rich to the middle class leads to increased spending, but further extensions lead to declines in expenditure. This prediction is tested by constructing a dataset of town council expenditure in Britain between 1867 and 1910. The effect of franchise extension is identified by exploiting regional and temporal variation in the right to vote. The results show strong support for the theoretical prediction, with government spending highest when around 50% of the adult male population was enfranchised. |
| Date: | 2020–03 |
| URL: | http://d.repec.org/n?u=RePEc:nad:wpaper:20200045&r=all |
| By: | Bertrand Garbinti; Frédérique Savignac |
| Abstract: | We propose a new and simple method to study intergenerational wealth correlation between two generations, which is easy to implement in wealth (and housing) surveys and aims at overcoming the strong data limitation faced in most of the countries. We show that the ownership of housing assets can be used to proxy for three wealth groups for all cohorts. Misclassification induces a low and downward bias in the estimate of the intergenerational correlation. Using France as an example, we estimate intergenerational wealth correlation for cohorts covering the 20th century and focus on the wealth positions measured at the mid-life cycle of both children and parents. First, probabilities to belong to top wealth groups are increasing with the wealth of the parents. This intergenerational correlation has increased over time for most of the top wealth groups. Second, the higher we move up along the children’s wealth distribution, the larger the role of parental wealth: the persistence in the top 50% is 38% higher than under perfect mobility and the deviations from perfect mobility are larger in higher top wealth groups. Third, 50 to 60% of the correlation is accounted for by a mix of intergenerational wealth transfers, fathers’ occupation and children’s education. Fourth, gifts and bequests explain a larger share of the link between parental wealth and the probability to belong to the top 10% compared to larger top wealth groups. We also find evidence of persistence of the effect of parental wealth over the life-cycle. |
| Keywords: | Intergenerational Wealth Correlation, Multigenerational Mobility, Real Estate,Homeownership, Bequest . |
| JEL: | D31 J62 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:776&r=all |
| By: | Azam, Jean-Paul |
| Abstract: | This paper shows that the two oil shocks that occurred in 1974-85 and 2003-15 inflicted sizable damage to total factor productivity (TFP) in France and Germany. These are resource-poor economies whose firms are importing most of their inputs of extractive commodities. The real prices they pay for them impact directly on their value added and hence on GDP in aggregate. We single out the price of crude oil as the most important and volatile of this set of highly correlated prices. This real price depends both on the world commodity market and on the exchange rates between the US dollar and the relevant European currencies, themselves determined by monetary policy in the US and in Europe. The significance of this mechanism is confirmed econometrically, and its quantitative implications are assessed. On average, these countries have lost more than 1% of potential TFP during these oil shocks, Germany being affected more severely than France. Historical analysis shows that episodes of US dollar appreciation have significant impacts on French and German TFP via this channel. |
| Keywords: | Oil Shocks, Total Factor Productivity, France, Germany |
| JEL: | N10 N70 O47 |
| Date: | 2020–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:124474&r=all |
| By: | Janet Hua Jiang |
| Abstract: | This note discusses insights from historical launches of new payment methods and related laboratory experiments on the potential adoption and use of a central bank digital currency in the Canadian context. |
| Keywords: | Central bank research; Digital currencies and fintech |
| JEL: | C9 E4 E5 E58 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocsan:20-12&r=all |
| By: | Xinyu Fan; Lingwei Wu |
| Abstract: | We study foot-binding – a practice that reshaped millions of women’s feet in historical China, yet in lack of a consistent explanation of its temporal, regional, class, and size variation. We present a model of foot-binding, where it serves as a premarital investment tool in response to a male-specific social mobility shock, and women trade off labor distortions for marriage prospects. Furthermore, the regional shifts on both sides of the trade-off explained its observed variation. Using county-level archival data on foot-binding, we corroborate the theory with empirical evidence. |
| Keywords: | Gender Norm, Marriage Market, Labor, Foot-binding |
| JEL: | N35 J16 O15 Z10 |
| Date: | 2020–06 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2020_187&r=all |
| By: | Anna Aizer; Shari Eli; Adriana Lleras-Muney |
| Abstract: | All redistributive and social insurance programs trade off the potential benefits of transfers with the disincentives these programs generate. We investigate this trade-off using newly collected lifetime data for 16,000 women who applied to the Mothers’ Pension Program, the first cash transfer program in the US. In the short-run cash transfers reduced geographic mobility and delayed marriage of recipients but did not affect who they married or where they moved to. In the long run transfers had no effect on work, marriage or fertility behaviors. They also did not improve the economic conditions of recipients or their longevity. |
| JEL: | I12 I14 I18 I32 I38 J16 N32 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27523&r=all |
| By: | Carlos Bianchi (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Pablo Galaso (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Sergio Palomeque (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración) |
| Abstract: | This research aims to analyze the collaboration networks associated with the processes of invention and patenting in Latin American countries between 1970 and 2017. To do so, we apply social network analysis techniques to a rich database containing information from patents developed by Latin American inventors and registered in the USPTO during such period. We build and analyze three types of collaboration networks: networks of inventors, networks of innovators (i.e. patent owners) and networks of countries in the region. The study of the structural properties and the evolution of such networks allow us to present unprecedented empirical evidence on the forms of interaction and collaboration to invent in Latin America. This evidence shows that collaboration networks in Latin America are highly fragmented and disconnected. Moreover, networks are notoriously foreign-oriented, i.e. the linkages with external nodes are critical compared to the low presence of local connections. Major differences among the countries of the region can be observed, which allow us to identify different behaviors according to how much they use the patent system and the relative development of the national networks. In a region which has been historically characterized by high heterogeneity, this research allows recognizing specific patterns of innovation at the national level. In sum, the contributions of the paper are three fold. First, it presents novel empirical findings with unique information on interaction patterns at the Latin American level. Second, it allows analyzing the whole region and the main trends in the light of the large research background on invention and development from this region. Finally, it discusses some stylized facts in national cases, with the aim of encouraging new research questions for further research agenda. |
| Keywords: | patents, invention, social network analysis, collaboration networks, Latin America |
| JEL: | O31 O54 P48 |
| Date: | 2020–04 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-04-20&r=all |
| By: | Olivier Mesly; David W. Shanafelt; Nicolas Huck |
| Abstract: | Predator-prey dynamics are widely used in ecology but seldom utilized in economics and marketing, despite their ability to express financial market agents’ behaviors when considered in combination with economic cycles and financial crises. This multidisciplinary paper presents a stylized framework of a market cycle that combines the notions of supply and demand and predator-prey interactions between buyers and sellers of housing mortgages. We illustrate our framework using data from the Global Financial Crisis and a Lotka-Volterra predator-prey model. We find that with our framework we are able to capture the dynamics of the market, particularly the peak and decline in the number of sellers and sold subprime mortgages. Our framework sheds a new light on consumer behaviors, pinpointing how they can put themselves into vulnerable prey positions. This paper is one of the first of its kind to propose market phases and predator-prey dynamics nested in economic cycles and consumer buying trends. |
| Keywords: | Toxic products; predator-prey behavior; financial crisis; regulations; consumer abuse. |
| JEL: | M31 N22 N42 O16 P46 R31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2020-35&r=all |