Larry Summers coined the phrase “The Davos Lie” back in 2007; my latest column in Critical Quarterly covers some of what I’ve written on the subject over the years. Here is another recent piece on the subject.
Jordà, Schularick and Taylor have produced a must-read paper, summarising the results of a decade-long research effort to create a long-run macro-financial data set for 17 countries. The paper is here (.pdf) and they provide some new stylized facts they document should “prove fertile ground for the development of a newer generation of macroeconomic models with a prominent role for financial factors”.
In particular, they document a ‘hockey-stick’ effect of private sector creditto GDP for a range of economies, and one of the hockey sticks can be seen in the figure below. After about 1950, for most of the elements the authors study, finance and leverage takes a more and more central role in the development of modern economies.
In 1909 Tom Kettle was appointed the first Professor of the National Economics of Ireland at University College, Dublin.
He was in Belgium running arms for the National Volunteers when the war broke out in 1914. What he perceived as the barbaric Prussian assault on European civilization prompted him to apply for a commission with the Royal Dublin Fusiliers, which he was awarded in 1916.
He was killed in action at Ginchy (Picardy) during the Battle of the Somme on 9th September 1916.
In the spring of 2006 the late Gerry Barry, the RTÉ broadcaster, organized a public meeting (in the former House of Lords chamber at College Green) to mark the 90th anniversary of Kettle’s death. He asked me to contribute a piece on Kettle’s work as an economist.
Ten years on, and a century after Kettle’s death, I thought readers might be interested in the brief essay I wrote for the occasion.
More details of his life are available in the excellent Wikipedia article on him:https://en.wikipedia.org/wiki/Tom_Kettle.
I’m writing an economics column in Critical Quarterly, a humanities journal, which is a bit of fun. They are supposedly free to view for 12 months after publication. I already posted a link to the first, on the European democratic deficit, but neglected to link to the second, on migration. The third, on secular stagnation, is available here.
It was way back in April 2009 that Barry Eichengreen and I first compared the world industrial output collapses of 1929 and 2008. The situation looked pretty alarming at that stage, but it turned out that we were a good leading indicator of recovery: the world economy started turning around almost immediately afterwards, thanks to a coordinated reflationary macroeconomic policy response. Then 2010 happened, reflation turned to austerity in Europe, and the global recovery slowed, to the point where at times it seemed to be petering out almost altogether.
And in August of this year, the inevitable happened: measured in terms of industrial output, our current recovery was overtaken by that of the interwar period. Pretty dismal stuff. Let’s hope that we can at least avoid the famous 1937-38 double dip, visible at the end of the interwar series.
The 2015 annual conference of the Economic and Social History Society of Ireland will take place on Friday 27 and Saturday 28 November 2015 at Mary Immaculate College, University of Limerick.
Submissions can be on any areas of business, economic, financial and social history, but submissions addressing the conference theme ‘Exploring Everyday Lives’ are particularly encouraged.
Submission deadline is 15 October 2015.
Download the call for papers here.
The society’s web site is www.eshsi.org
Philippe Legrain points out that, far from creating the sort of European-level democratic space that would allow citizens to choose between political and economic alternatives, closer European political union is likely to place more even restraints on the power of politicians to respond to voters’ demands for alternative policies. This is because ever more rules proscribing what others can do, and made up by Germany, is what Germany wants (not that she has historically felt bound by rules when fundamental national interests are at stake, as inter alia the collapse of the EMS and the scrapping of the excessive deficit procedure inform us; and quite right too in my view).
But why does Germany want this?
Harold James has one view here.
And here is J.A. Hobson:
Moreover, while the manufacturer and trader are well content to trade with foreign nations, the tendency for investors to work towards the political annexation of countries which contain their more speculative investments is very powerful.
Paul Mason has a blog post and interview here, worth reading and watching. I am going to stick my neck out and assert that Manolis Glezos does in fact speak with a certain moral authority. But it is the German deputy finance minister’s constant insistence on obeying the law that prompts this post, along with its title. For German government use of the principle in the economic domain, see here (p. 188).
The latest in an important series of papers by Jordà, Schularick and Taylor is described here.
Although they don’t spin it this way (which is not surprising, since they don’t provide evidence about the impact of fiscal policy on housing booms and busts), the work suggests to this reader potential arguments (on top of the more standard ones) regarding the benefits of automatic stabilisers and countercyclical fiscal policy.
The latest column in the VoxEU series on the economics of World War I is by Steve Broadberry, and is available here.
Òscar Jordà, Moritz Schularick, and Alan Taylor provide a little historical perspective on banks’ mortgage lending here.
The latest on the VoxEu series on the economics of World War 1 is available here.
Nick Crafts provides the latest instalment in the VoxEU series on the economics of World War 1, here.
This paper of mine just came out in a special issue of Oxford Review of Economic Policy on the question of Scottish independence. I had been asked to reflect on Irish economic performance since independence, on the exercise of fiscal and monetary sovereignty, and on migration policy, without saying anything about Scotland.
From an earlier draft I attach a comparison of population growth in Ireland and Scotland and their respective peripheries.
A tangled though remarkable story behind the proof in the mid-1950s of the existence of a competitive general equilibrium (Arrow-Debreu, as it is known) is summarised in a recent posting on economicprincipals and revised (rather drastically, it must be said) here (scroll down to ‘A correction’).
There are strong echoes of the controversy over the proper academic credit for the discovery of the double helix structure of DNA. In the Economics case, the problem was compounded by a very slow refereeing process while rivals worked on a related research paper.
Economic Principals is itself an interesting website reporting on topical issues as well as presenting non-technical interpretative overviews of controversies in economics, often disentangling the intellectual, institutional and personal issues. One example, amongst many, relating to the 2011 Sargent-Sims Nobel Prize, is here. The full archive is online.
Irish Educational Studies recently published a special issue to commemorate the landmark report Investment in Education (which was commissioned in 1962 and released in 1965). The report’s finding that half of all children were leaving school by the age of 13 generated newspaper headlines and created the environment for Donogh O’Malley’s ‘free education’ initiative of 1966. An appendix to the report provided information on the educational attainment of the population in 14 European countries (including seven in Eastern Europe) as well as in the US, Japan and Israel. No equivalent statistics could be produced for Ireland. Questions relating to educational attainment were included in the Irish Population Census from the following year. This issue of Irish Educational Studies includes two witness accounts by key players, Áine Hyland, an RA to the report team, and Seán O’Connor, first head of the Development Branch of the Department of Education. The issue, entitled Investment in Education and the Intractability of Inequality, also contains four academic papers. Mine is available here. The abstract reads as follows:
Most studies of the relationship between education and economic development focus on the line of causation running from the former to the latter. The present paper studies how the pattern of Irish development has influenced the structure of the Irish education system. The first section sets out the economic context of late industrialisation within which Investment in Education was commissioned and which determined the reception that the report received. The report’s release would be followed shortly thereafter by a series of policy measures that would expand secondary-school enrolment and graduation rates and massively increase the demand for third-level places. Later sections analyse the subsequent evolution of Ireland’s binary system of tertiary education and the recent attention devoted to science, technology and innovation policy and the ‘fourth level’ (postgraduate) sector. Concluding comments focus on the continuing relevance of the perspective embodied in Investment in Education for the surprisingly high numbers who continue to leave the Irish education system without a Leaving Certificate qualification.
The fifth in the VoxEU series of articles on the economics of World War I is available here.
Harold James provides the latest addition to the VoxEU series on WW1, here.
The latest contribution to the VoxEU series on the economics of World War I is available here.
A friend just told me the very sad news that Barbara Solow passed away in February.
She wrote a classic book on Ireland, The Land Question and the Irish Economy, which has a good claim to being the first major cliometric work on Ireland — if by cliometric you mean economic history that is strongly informed by economic theory, and systematically uses data to back up the arguments being made. In more recent years she did terrific work on plantation slavery, which was very influential and certainly made a big impression on me. The last time I saw her was at a conference which she organised in Oxford a couple of years ago to commemorate Eric Williams, and she was as impressive as ever.
I can’t claim to have known her very well, but she was always very nice to me when I was a young Irish economic historian in Boston. She had a wonderful dry sense of humour, and produced one of the great acknowledgment footnotes of all time. Her death is a major loss for the profession, and my heart goes out to her family.
The Economist has been hosting a roundtable discussion on deflation in the Eurozone, and asked me to say something about this from a historical perspective. My contribution is here. (I should also say that the copyeditor removed my reference to Barry Eichengreen, the go-to person on these matters.)
The Annual Conference of the Economic and Social History Society of Ireland is being held in NUI Galway on Friday 22nd and Saturday 23rd of November, convened by Niall Ó Ciosáin and Caitríona Clear.
Registration/booking information and the conference programe are available at:
The Society’s main web page is here.
Òscar Jordà, Moritz Schularick, Alan Taylor have a new piece on the issue, available here.