Ronald Finlay,Rolf G. Henriksson,Hkan Lindgren & Mats Lundahl (eds), Eli Heckscher,International Trade and Economic History

Abstract

The great world economic and globalisation boom of the pre-First World War era was accompanied by great inequality in the distribution of income and wealth particularly during industrialisation, with the new world European settler economies being no exception. Canadian wealth inequality over the period 1870–1930 was also substantial and is examined using probated estates from the Eastern Judicial District of the province of Manitoba and Wentworth County, Ontario. However, wealth inequality is found to be less pronounced in frontier Manitoba relative to Ontario with higher and more dispersed rates of land ownership in the West as well as lower wealth levels and greater farm employment, as the key factors in this difference. This suggests that the farm economy of pre-First World War Canada was associated with greater equality of wealth. One of the inevitable effects of Canadian industrialisation and economic development was a rise in wealth inequality but the process of western settlement and associated free grants helped mitigate it. By extension, global economic inequality might also have been mitigated during this period by the presence of agricultural frontiers with subsidised land grants.     

The concept of the unemployable

Current government policy documents have been concerned with reforming welfare policy, with matching rights with responsibilities, and especially with reducing the numbers of incapacity benefit claimants. This article places these debates in historical perspective, and revises the existing historiography on poverty and unemployment, by exploring the concept of the 'unemployable' in the period 1880–1940. Up to 1914, unemployability embraced those unable and those unwilling to work, and in the 1920s, similar anxieties were reconstructed in the concept of the 'social problem group'. However, interwar social surveys were concerned more with the effects of long-term unemployment in creating unemployability. There are thus both changes and continuities between historical concerns with unemployability, and contemporary anxieties about incapacity benefit and worklessness.     

An empirical re-evaluation of wealth effect in Japanese household behavior

This study investigates empirically the role of wealth in the behavior of Japanese households from two standpoints. One is concerned with what types of wealth are relevant in consumption decision by households. The other is which component of consumption spending is affected by wealth. We find that the liquid financial wealth appears as a significant explanatory variable in expenditure function of many commodity groups as well as total consumption. It turns out that variations of liquid wealth are responsible for about one third of the change in aggregate consumption in the boom period starting from the middle of 1980s.     

The German inflation and foreign business cycles, 1920–1922

The real fluctuations of the German macroeconomy in the early 1920s differed markedly from those of the other major industrial economies. As the others began a steep depression in 1920, German prices stabilized and the economy grew, led by increased investment in response to the stabilization of the political climate. German income growth increased its trade deficits for about a year and cushioned the onset of the depression abroad. In summer 1921, however, as Germany began paying reparations, inflation restarted and investor confidence ebbed. The German boom strengthened then because exports increased and filled the gap left by lagging investment. As Germany struggled to pay reparations, her export boom worsened the depression of demand in the Allied economies, struggling then to recover from the depression.     

THE INAUGURAL NOEL BUTLIN LECTURE: WORLD FACTOR MIGRATIONS AND DEMOGRAPHIC TRANSITIONS

This lecture explores the connection between demographic transitions, mass migrations and international capital flows. It reviews how demographic transitions influence the size of age cohorts, and then how these changes in age distribution influence excess demands in receiving regions and excess supplies in sending regions. The lecture offers four examples – two from the first global century and two from the second global century – where shocks generated by demographic transitions have had an enormous impact on factor flows: European mass migrations to the New World before 1914; African mass migrations to the OECD over the past two decades; British capital export to the New World before 1914; and capital flows across East Asian borders after 1950 and before the melt down of the 1990s. The lecture concludes with an assessment of the demographic contribution to the East Asian miracle (and slowdown) over the past half century.     

Book Reviews

Gary Bryan Magee, Productivity and Performance in the Paper Industry: Labour, Capital and Technology in Britain and America, 1850–1914
Lance E. Davies, Robert E. Gallman and Karin Gleiter, In Pursuit of Leviathan: Technology, Institutions, Productivity, and Profits in American Whaling, 1816–1906
Manfred Neumann, The Rise and Fall of the Wealth of Nations: Long Waves in Economics and International Politics
Sanjaya Lall, Learning from the Asian Tigers: Studies in Technology and Industrial Policy     

Did closures do any good? Labour productivity,mine dynamics,and rationalization in interwar Ruhr coal mining

Throughout the late 1920s, German coal mining saw an exceptional surge in labour productivity, led by the performance of the Ruhr coal mines. It is commonly accepted in the relevant literature that the economy‐wide ‘rationalization boom’ explains that pattern. This study tests the related hypothesis that ‘negative rationalization’, in the form of a massive wave of mine closures over the period 1924–9, played a significant role in stimulating aggregate labour productivity in the Ruhr coal district. Using an original dataset for the totality of Ruhr coal mines, the causes of productivity change over the broader period 1913–38 are identified, using the decomposition method of Foster, Haltiwanger, and Krizan. Results suggest that labour productivity was driven largely by improvements at individual mines, attributable to the intensified mechanization of underground operations. In sharp contrast, turnover effects were marginal, overall, compared to the effects stemming from the producer dynamics among surviving mines. Thus, the practical productivity implications of mine closures during the rationalization boom are negligible and overrated in the literature. These findings indicate the necessity of testing the relative importance of ‘negative rationalization’ in the form of plant closures in other branches of the Weimar economy.     

The rise of coffee in the Brazilian south-east: tariffs and foreign market potential, 1827–40†

During the period spanning independence in 1822 to mid-century, Brazil's south-east shifted from specializing in the export of cane sugar to coffee. This article explores the mechanism underlying this shift by exploiting a wealth of new monthly data on the Brazilian and international coffee and cane sugar markets during the period 1827–40. It argues that the timing of the coffee boom was driven by a rapid increase in foreign market potential associated with the abolition of the tariff on coffee in the US. It estimates that American tariff reform served to increase coffee exports and African slave imports by around one-fifth. American firms, with indirect links to the slave trade, rapidly became major players in the export market in Rio de Janeiro, while non-American firms, traditionally specialized in continental European destinations, turned their sights on the American market.     

The impact of the rise and collapse of Japan's housing price bubble on households’ lifetime utility

This study estimates the impact of the dramatic changes in housing prices during Japan's bubble from the late 1980s to the 1990s on households’ asset accumulation and utility over their life cycle. We construct a life-cycle model explaining households’ consumption/saving and housing decisions under collateral and borrowing constraints. We estimate this model using data from the Family Income and Expenditure Survey (FIES), which includes data on households’ housing wealth estimated from objective information. Using the estimated model, we then conduct a counterfactual simulation in which we assume that housing prices remained constant during the bubble period. Doing so allows us to quantify the gains/losses of lifetime utility due to the housing price boom and bust. We find that 72.2% of the households experienced an average decrease in lifetime utility equivalent to 5.7% of lifetime income. On average, Japan's housing price boom and bust caused a loss in lifetime utility equivalent to 4.7% of lifetime income. Moreover, we compare the impact of the housing price bubble across cohorts and find that the impact was greatest for those who experienced the bubble at ages 35–45.     

Losing the future: Household wealth from urban housing demolition and children's human capital in China

Some literature observes the negative but not very significant effect of household wealth growth on children's educational outcomes. This surprising finding is not easily reconciled with the traditional explanation that relaxed economic constraints caused by wealth growth can promote human capital accumulation. This paper proposes an alternative explanation for the causal relationship between wealth growth and human capital, which could be negative: individuals tend to reduce human capital investment following the decline in their labor supply induced by wealth growth, given that investing in human capital is mainly for employment competitiveness. This explanation is supported by evidence from the case of urban housing demolition in China, in which affected households could obtain substantial wealth growth by considerable demolition compensation thanks to the real estate boom in China. Specifically, using two nationally representative datasets, we find that Chinese households that have experienced demolition relatively have more wealth, less labor supply, lower propensity to accumulate children's human capital, and consequently, have children with lower educational achievement. These results suggest that China's economy may be losing its momentum because of the decline in labor supply and human capital accumulation brought about by the ongoing large-scale urban housing demolition.     

Regional wage convergence in Spain 1850–1930

This paper presents a new regional database on real wages for Spain from 1850 to 1930. This evidence is used to analyze the evolution of wages across regions and occupations. Substantial wage convergence occurred from 1850 to 1914, despite low rates of internal migration. World War I and the subsequent globalization backlash were associated with a spectacular increase in wage differentials. However, real wage convergence across Spanish provinces resumed during the 1920s, this time accompanied by high rates of internal migration.     

资产价格具有通货膨胀指示作用吗——基于LT-TVP-VAR模型的实证研究

资产价格变动通过财富效应等渠道影响总需求进而通货膨胀的变动,但其影响方向、强度及时变性尚有待进一步研究。本文通过建立包含潜在门限的时变参数向量自回归模型,实证研究房地产价格和股票价格对通货膨胀影响的时变特征。实证结果表明,房地产和股票价格均对通货膨胀产生显著的同向影响,并且影响强度表现出顺周期的时变规律。在资产市场发展的“繁荣期”,影响强度不断增强;而在“低迷期”,其影响趋弱甚至无效。当股票市场和房地产市场运行出现周期错配时,其通货膨胀效应更趋复杂和不确定。     

Book reviews

Books reviewed in this article:
Jim McAloon, No Idle Rich: The Wealthy in Canterbury and Otago 1840–1914
Stuart Jones (ed.), The Decline of the South African Economy
Debora Spar, Pirates, Prophets and Pioneers. Business and Politics Along The Technological Frontier
Anthony M. Endres and Grant A. Fleming, International organizations and the analysis of economic policy, 1919-1950
Randall E. Parker, Reflections on the Great Depression     

The pastoral boom,the rural land market,and long swings in New Zealand economic growth, 1873–19391

Higher farm and manufacturing productivity associated with refrigerated exports led to New Zealand's attainment of the world's highest Human Development Index in 1913. Local responses to export opportunities increased the social depth of land ownership and fostered intensive growth. Closer settlement meant that land‐related income gains spread widely, but land market volatility also created instability. New Zealand had the world's highest GDP per capita in 1938, but it experienced long swings in its growth rates. Dramatic swings in rural land market activity engendered by the pastoral boom contributed greatly to a long depression in the 1920s; subsequently a new monetary regime facilitated fast recovery.     

Book Reviews

Book reviewed in this article:
BAROCH, P. and LÉVY-LEBOYER, M. (eds). Disparities in Economic Development since the Industrial Revolution .
CHAUDHURI, P. The Indian Economy, Poverty and Development .
COTTRELL, P. L. Industrial Finance 1830–1914 .
CROTTY, R. Cattle, Economics and Development .
GREEN, T. The World of Diamonds .
MOGGRIDGE, D. E., Keynes .
ROUTH, G. The Origin of Economic Ideas .     

Big push or big grab? Railways,government activism,and export growth in Latin America, 1865–1913

Railways were one of the main engines of the Latin American trade boom before 1914. Railway construction often required financial support from local governments, which depended on their fiscal capacity. However, since the main government revenues were trade‐related, this generated a two‐way feedback between government revenues and railways, with a potential for multiple equilibria. The empirical tests in this article support the hypothesis of such a positive two‐way relationship. The main implication of our analysis is that the build‐up of state capacity was a necessary condition for railway expansion and also, to a large extent, for export expansion in Latin America during the first globalization.     

The impact of war on Russian and Soviet development 1850–1950

This article discusses the magnitude of wartime losses to Russian capital stock and population, the prospect of benefits from wartime developments and the burden imposed by the transfer of resources to the war effort. Total losses of manpower and capital, and the deprivation of civilian consumers, were greater in the Civil War (1918–1920) than in 1914–1917, but were exceeded by the impact of the Second World War (1941–1945). Potential benefits are not found to be significant. This article also examines the losses of population and capital during the ‘internal war’ of the 1930s.     

宁波帮博物馆

宁波籍人士外出经商,古已有之;结成商帮,则是在明朝末年。到清朝末年,"宁波帮"一词已频繁地出现在各种报刊和书籍中。据不完全统计,至今仍有73000多名宁波籍人士分布在世界64个国家和地区,加上他们的后裔,总人数超过30万。从国内来说,宁波籍人士更是遍布全国各地,早就有"无宁不成市"之说。他们中不乏工商巨头和科技专家,如包玉刚、董浩云、王宽诚、安子介、邵逸夫、陈廷骅、曹光彪、李达三、孙忠利等人。如今,浩瀚的太空中邀游着5颗以宁波人命名的小行星:邵逸夫星、王宽诚星、曹光彪星、李达三星、谈家桢星。在我国两     

REFRIGERATION AND DISTRIBUTION: NEW ZEALAND LAND PRICES AND REAL WAGES 1873–1939

The responses in New Zealand to the opportunities of refrigeration transformed farming in the Dominion during the half-century from 1890. Closer settlement and the extension of the cultivated area combined with more intensive farming methods to increase land productivity and real gross domestic product capita to the extent that living standards in New Zealand measured by the Human Development Index ranked first in the world by 1913. In contrast, real wages in the Dominion stagnated. The refrigeration-related trade boom had powerful income distribution effects that increased sharply the land rental–wage ratio during the years to 1920. Widely diffuse land ownership in New Zealand tempered the rise in income inequality, to set the Dominion apart from other land-abundant economies of the periphery.