Saito, O. and T. Settsu: one banker v. seven samurais

December 20, 2010

Saito, Osamu and Tokihiko Settsu (2006) Money, credit and Smithian growth in Tokugawa Japan. Hitotsubashi University. Institute of Economic Research. Discussion Paper #139.

In Osaka, Japan’s commercial capital, under the Tokugawa, rich merchants began to add to their functions that of lender to the mighty overlords (daymo) who needed to transform the production of their domain in bullion in order to cover their expenses in Edo and the taxes due to the Shogun (p.2). At the time, the country was segmented in small local capital market and no security was traded over the whole country. Despite those limitations, the rural industries did grow over the period, yet for that they had to have access to some fundings. Where did this capital come from? (p.3)

This wholesaler system arose in replacement of an inexistent banking sector (p.4). However this organization favored greatly the Osaka merchant who managed to impose de facto their service as a necessary precondition to any industrial or agricultural endeavor (p.5). But at that time, local merchants took on Osaka’s oligopoly.

To develop the production and trade of a wealth of proto-industrial products, they started delivering themselves those products to Edo, thus by-passing the Osaka intermediaries. Local lords backed these initiatives, for instance by issuing bank notes (hansatsu) to remedy to the dramatic shortages of money (p.9). However often successful, these initiatives led to a quick segmentation of the Japanese capital market and each of these small areas suffered from high interest rates (more than 18%), while at the same time interest rates in Osaka kept following (p.10).

A system, close to the earlier one arose after the Meiji Revolution, but this time with several commercial cities as the center of the operations instead of Osaka alone (p.13).

On hyperinflations

August 24, 2009

Hyperinflations through history

Here’s a chart by Steve H. Hanke and Alex K. F. Kwok comparing the Zimbabwean hyperinflation with other periods  of [hyper]accelerated growth of price levels in the 20th century.

The current Zimbabwean hyperinflation is second only to the Hungarian episode after WWII. Then, prices doubled each 15 hours.

Found via Alejandro Villagomez‘s blog.

Prehistoric agriculture and climate change

August 18, 2009
Methane levels and the rise of (extensive) farming in Europe and Asia

Methane levels and the rise of (extensive) farming in Europe and Asia (The Economist)

Here’s a new article in The Economist showing evidence of climate change in the ice polars caps at the same time agrarian societies emerged.

The ice-core record shows that the level of carbon dioxide in the atmosphere made an anomalous upturn about 7,000 years ago, and that methane levels, which were also falling, began to increase about 5,000 years ago. These numbers correspond well with the rise of farming in Europe and Asia.

It appears that the extensive farming method used by early farmers was responsible of a more than proportional increase in methane, a greenhouse gas. Yet another point for Georgescu-Roegen and thermoeconomics.

Clingingsmith D. and Williamson J. (2008) The world conjuration against the Indian industry

August 2, 2009

Clingingsmith, David and Williamson, Jeffrey G. (2008) “Deindstrialization in 18th and 19th century India: Mughal decline, climate shocks and British industrial ascent”, Exploration in Economic History, 45/3, 209-234.

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Between 1700 and 1900, India went from being an industrial powerhouse to forgotten backwater. Why didn’t India manage to retain its edge and how did Britain overtake the giant? Read the rest of this entry »

Matthee R. (1994) For piety and pleasure, coffee and coffeehouses in Safavid Iran

August 1, 2009

Matthee, Rudi (1994) “Coffee in Safavid Iran: Commerce and Consumption”, Journal of the Economic and Social History of the Orient, 37/1, 1-32.

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Despite the fact that it took place roughly at the same period, the spread of coffee consumption over the world appear to have occurred independently from the European commercial expansion (p.1). It spread during the early 16th century from Arabia through the Ottoman Empire and to Iran (p.2). The habit may have penetrated the Safavid realm via the heavily Arab-influenced southern shores. The constant wars and exchange of territories between the two empires can only have helped to spread this Turkish custom (p.5). Read the rest of this entry »

Richards J. (1990) One century late: the 17th century crisis in India

July 28, 2009

Richards, John F. (1990) “The Seventeenth-Century Crisis in South Asia”, Modern Asian Studies, 24/4, 625-638.

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Evidence of the 17th-century ‘General Crisis’ have been found all over Eurasia. However in India those years represent the golden age of the Mughal dynasty (p.625). The subcontinent enjoyed a long period of relative peace after the violence of the conquest (p.626). Read the rest of this entry »

Web shopping: Newspaper article on Xinjiang’s economic history

July 15, 2009
"Police officers marching in Urumqi". Photo by Gilles Sabrie for The New York Times

"Police officers marching in Urumqi". Photo by Gilles Sabrie for The New York Times

If you want to know more about the historical and economic origins of Uighur’s unrest in China last weeks, here is a good article on Xinjiang’s history by Edward Wong, a New York Times journalist.

History’s among us

May 21, 2009

Google unveils an odd cast-based discrimination dating back from the Tokugawas: scandal in Japan (from Yahoo! tech).

Old Japanese maps on Google Earth unveil secrets

By JAY ALABASTER, Associated Press Writer – Sat May 2, 2009 11:39AM EDT

TOKYO – When Google Earth added historical maps of Japan to its online collection last year, the search giant didn’t expect a backlash. The finely detailed woodblock prints have been around for centuries, they were already posted on another Web site, and a historical map of Tokyo put up in 2006 hadn’t caused any problems. Read the rest of this entry »

Goldstone J. (2003) Agricultural Revolution in China

March 22, 2009

Goldstone, Jack A. (2003) “Feeding the people, starving the state: China’s Agricultural Revolution of the 17th/18th Centuries”, paper for the EHES Istanbul conference, 43p.


This article is available online


The Chinese population jumped from 120 to 350 million between 1620 and 1800. Many historians have assumed that the necessary growth of the agricultural output had been reached through a process of “involution” (i.e. not through gains in labour productivity, but thanks to increased effort; p.1). This stagnation of the output per person has been seen as the reverse of what happened in England at the same time: the agricultural revolution (p.2). Read the rest of this entry »

Rainmakers in South East Asia

March 15, 2009

This week in The Economist


Historical determinism

Mar 12th 2009 | DALAT

THE idea that climate change will lead to war is often raised by environmental pessimists, and a meeting on the climatic past of South-East Asia, held last month in Dalat, Vietnam, suggests it is not such an unlikely thought. The meeting was organised by the Lamont-Doherty Earth Observatory, part of Columbia University, some of whose researchers have been trying to reconstruct the pattern of South-East Asia’s monsoons over the past few centuries. One matter they raised was the possibility that two periods of conflict in the area, in the 15th and 18th centuries, were provoked by droughts. Read the rest of this entry »

Mitchener K. and Ohnuki M. (2009) Capital integration in Japan

March 15, 2009

Mitchener, Kris James and Ohnuki, Mari (2009) “Institutions, competition and capital market integration in Japan”, The Journal of Economic History, 69/1, 138-171.



The causal relationship between finance and economic growth makes “understanding the factors that encourage capital market development […] a key question” (p.138). Meiji-era policy-maker recognized that “the geographical mobility of capital [was] critical to allocative efficiency” and that to modernize the economy they had to forge an integrated capital market (p.139). Read the rest of this entry »

Sylla R. (2002) Financial sytems and economic growth

March 11, 2009

Sylla, Richard (2002) “Financial Systems and Economic Modernization”, The Journal of Economic History, 62/2, 277-292.



The author answers the age-old question, “why isn’t the whole world developed?” by arguing that development differences can be explained by the “spread of modern financial systems, which serve to facilitate the acquisition and application of both nonhuman and human capital”. And the “key institutional components” necessary to describe what is a modern financial system are: “sound public finances and public debt managements; stable monetary and payment arrangements; sound banking system (more generally, institutional lenders); an effective central bank; and sound insurance companies (more generally, institutional investors)” (p.280). Read the rest of this entry »