Class structure and inequality during the industrial revolution: lessons from England's social tables, 1688–1867

This article measures the size and incomes of six major social classes across the industrial revolution using social tables for England and Wales in 1688, 1759, 1798, 1846, and 1867. Lindert and Williamson famously revised these tables, and this article extends their work in three directions. First, servants are removed from middle‐ and upper‐class households in the tables of King, Massie, and Colquhoun and tallied separately. Second, estimates are made for the same tables of the number and incomes of women and children employed in the various occupations, and, third, incomes are broken down into rents, profits, and employment income. These extensions to the tables allow variables to be computed that can be checked against independent estimates as a validation exercise. The tables are retabulated in a standardized set of six social groups to highlight the changing structure of society across the industrial revolution. Gini coefficients are computed from the social tables to measure inequality. These measures confirm that Britain traversed a ‘Kuznets curve’ in this period. Changes in overall inequality are related to the changing fortunes of the major social classes.     

Measurement distortion and missing contingencies in optimal contracts

Summary Theory suggests that optimal contracts should include many contingencies to achieve optimal risk sharing. However, in practice, few contracts are as complex as theory suggests. This paper develops a model which is consistent with this observation. The lack of risk sharing results from the interplay of two factors. First, contingencies must be based on information produced by measurement systems, which may be manipulable. Second, when two parties to a contract meet, they often have incomplete information. The type of contract offered may reveal information about the party who proposes it. Different types of agents have different preferences over contingent contracts, because they have different abilities to manipulate the measurement system. These differences in preferences allow the parties to signal their types through the contracts they offer. Noncontingent contracts may be chosen in equilibrium because they are the only contracts which do not give any type an incentive to distort the measurement system and, hence, do not reveal information about the party proposing the contract.We have benefited from conversations with Oliver Hart, Rick Lambert, Michael Riordan and Jean Tirole and the comments of Michel Habib, Nick Yannelis and two anonymous referees. Financial support from the National Science Foundation under grants SES-8920048 and SES-8720589 is gratefully acknowledged.     

Tailored Regulation: Will Voluntary Site-Specific Environmental Performance Standards Improve Welfare?

Increasingly popular tailored regulation (TR) initiatives like the Environmental Protection Agency's Project XL allow industrial facilities to voluntarily substitute site-specific environmental performance standards for inefficient command-and-control regulations. TR can significantly reduce participants' costs of complying with environmental regulations, but in doing so it can also give these participants a competitive advantage. Here we develop an analytical model to show that TR can have adverse welfare effects when if enables relatively inefficient firms in oligopolistic markets to “steal” market share from more efficient firms, and we characterize the regulatory policies that give rise to such outcomes. We also show that regulators' efforts to diffuse the benefits of site-specific agreements among nonparticipating firms dampen incentives to participate in TR.     

The Cultural Economy of Cities

An increasingly important fraction of contemporary economic activity is devoted to the production of cultural outputs, i.e. goods and services with high levels of aesthetic or semiotic content. This kind of economic activity is especially, and increasingly, associated with a number of large cities scattered over the globe. A conceptual account of this phenomenon is provided on the basis of an exploration of the character of place-specific forms of culture generation and the agglomerative tendencies of many kinds of cultural products industries. The empirical cases of Los Angeles and Paris are briefly discussed. The dynamics of production, distribution and location of major cultural products industries are also examined. The paper ends with a brief allusion to the modalities of spatial differentiation of culture in contemporary capitalism and to a prospective cultural politics.     

Who are the world's most successful companies?

It seems that everybody wants to know which companies are the most successful. To help throw light on the issue, and to do so more reliably than the plethora of league tables and charts produced by most business magazines, the London Business School have teamed up with The Economist to compile an assessment of the top performers of the 1980's.     

The relationship between governance structure and risk management approaches in Japanese venture capital firms

This paper attempts to understand what drives Japanese venture capital (JVC) fund managers to select either active managerial monitoring or portfolio diversification to manage their firms' investment risks [J. Bus. Venturing 4 (1989) 231]. Unlike U.S. venture capitalists that use active managerial monitoring to gain private information in order to maximize returns [J. Finance 50 (1995) 301], JVCs have traditionally used portfolio diversification to attenuate investment risks [Hamada, Y., 2001. Nihon no Bencha Kyapitaru no Genkyo (Current State of Japanese Venture Capital), Nihon Bencha Gakkai VC Seminar, May 7]. We found that performance pay is positively related to active monitoring and that management ownership is positively related to active monitoring and negatively related to portfolio diversification. The managerial implication of our study is that venture capitalists should be as concerned about the structure of their incentive systems for their fund managers as they are for their investee-firm entrepreneurs. Agency theory says that contingent compensation is a self-governing mechanism for individual effort that is difficult to measure and verify. When properly applied, equity ownership and performance-based pay can have powerful influencing effects on the strategic choices of managers.     

Predicting the geo-temporal variations of crime and disorder

Traditional police boundaries—precincts, patrol districts, etc.—often fail to reflect the true distribution of criminal activity and thus do little to assist in the optimal allocation of police resources. This paper introduces methods for crime incident forecasting by focusing upon geographical areas of concern that transcend traditional policing boundaries. The computerised procedure utilises a geographical crime incidence-scanning algorithm to identify clusters with relatively high levels of crime (hot spots). These clusters provide sufficient data for training artificial neural networks (ANNs) capable of modelling trends within them. The approach to ANN specification and estimation is enhanced by application of a novel and noteworthy approach, the Gamma test (GT).