The Diversity of Industrial Experience: Cabinet and Furniture Manufacture in Late Nineteenth-Century Ontario

The diversity of paths to industrialization is illustrated bythe example of the cabinet- and furniture-manufacturing industryin Ontario, Canada. Complex and unpredictable demand combinedwith smaller markets and lower incomes than those in the UnitedStates and the relative abundance of wood to limit mechanizationand the size of enterprise in the Canadian industry. Small andunpowered workshops remained competitive throughout the nineteenthand into the twentieth century, creating a distinctive industrialexperience that reflects the unique interaction of local demandand supply.     

Market incompleteness and the equity premium puzzle: Evidence from state-level data

This paper investigates the importance of market incompleteness by comparing the rates of risk aversion estimated from complete and incomplete markets environments. For the incomplete-markets case, we use consumption data for the 50 US states. We find that the rate of risk aversion under the incomplete-markets setup is much lower. Furthermore, including the second and third moments of the cross-sectional distribution of consumption growth in the pricing kernel lowers the estimate of risk aversion. These findings suggest that market incompleteness ought to be seen as an important component of solutions to the equity premium puzzle.     

The index of dissimilarity as a measure of inequality

Quality & Quantity -     

ECONOMETRICS MEETS SENTIMENT: AN OVERVIEW OF METHODOLOGY AND APPLICATIONS

The advent of massive amounts of textual, audio, and visual data has spurred the development of econometric methodology to transform qualitative sentiment data into quantitative sentiment variables, and to use those variables in an econometric analysis of the relationships between sentiment and other variables. We survey this emerging research field and refer to it as sentometrics, which is a portmanteau of sentiment and econometrics. We provide a synthesis of the relevant methodological approaches, illustrate with empirical results, and discuss useful software.     

Henry George on Property Rights: Reply to John Pullen

John Pullen argues that Henry George's proposal to make land common property is inconsistent with his proposal to tax rent. This reply argues that George's two formulations are consistent, and that Pullen has confused common property with state property. On the other hand, Pullen's conception of property as composed of a basket of rights focuses attention on the question of whether, as trustee of the common property, a Georgist regime should be understood to have certain rights (and obligations) to constrain private land use decisions.     

Supersanctions and sovereign debt repayment

What might happen if a third-party entity had the power to implement fiscal reforms and/or punish sovereign debt defaulters? In contrast to recent history, extreme sanctions such as gunboat diplomacy and “fiscal house arrest” were used to punish debt defaulters during the period 1870–1913. We find that, after a “supersanction” was imposed, a country improved its fiscal discipline. As a result, ex ante default probabilities on new issues fell dramatically and the country spent no additional time in default. Our results suggest some type of external fiscal or monetary control may be effective in imposing discipline on serial debt defaulters.     

Market skewness risk and the cross section of stock returns

The cross section of stock returns has substantial exposure to risk captured by higher moments of market returns. We estimate these moments from daily Standard & Poor's 500 index option data. The resulting time series of factors are genuinely conditional and forward-looking. Stocks with high exposure to innovations in implied market skewness exhibit low returns on average. The results are robust to various permutations of the empirical setup. The market skewness risk premium is statistically and economically significant and cannot be explained by other common risk factors such as the market excess return or the size, book-to-market, momentum, and market volatility factors, or by firm characteristics.     

PHYSICAL STATURE IN NINETEENTH‐CENTURY NEW ZEALAND: A PRELIMINARY INTERPRETATION

During the late nineteenth century, the physical stature of New Zealand‐born men stagnated, despite an apparently beneficial public health environment and growth in per‐capita incomes. We examine trends and differentials in male stature through World War I enlistment and casualty records. Stature varied by social class, with professionals and men in rural occupations substantially taller than their peers. There is not enough evidence to show that the indigenous Maori population differed in height from men of European descent. Stagnation in stature in late nineteenth‐century New Zealand is consistent with patterns observed in Australia, North America, and Western Europe.     

HECKSHER-OHLIN IN CANADA: NEW ESTIMATES OF REGIONAL WAGES AND LAND PRICES

Many immigrant-receiving and land-abundant countries experienced a diminishing ratio of wages to land prices during the globalisation era from 1870 to 1910. Factor price evidence suggests that Canada does not fit the pattern. We present the first Canadian estimates of region-specific wages and land prices that span the period from 1871 to 1925. Our evidence indicates that while Canada as a nation looks like an anomaly in the era of convergence, this is largely an artefact of aggregating the experience of the labour-abundant eastern provinces with the late-settling and land-abundant western provinces.