Sessions of the Second Latin American Economic History Congress

September 21, 2009

Wordle: CLADHE-II: List of sessions

Here is the list of preapproved sessions  of the Second Latin American Economic History Congress (CLADHE-II), to be held in Mexico City on February 3-5, 2010. To submit a paper to any of the sessions, you have to go here.

Wordle: CLADHE-II: Lista de simposios


On Lehman Brothers

September 15, 2009
Those were happy times...

Those were happy times...

After the US Treasury and the Federal Reserve denied to rescue Lehman Brothers, the once almighty investment bank failed a year ago, beginning what would turn to be the mother of all financial crises.

Here is an exclusive Reuters interview with Richard Fuld, the president of Lehman at the time of its bankruptcy.

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The New York Times has published three good pieces on the issue: ‘An Epidemic of Capital Destruction’, Tales From Lehman’s Crypt (showing the lives and fates of three former Lehman employees) and Lehman Had to Die So Global Finance Could Live. It also has a neat visualization showing the market capitalization of the biggest financial firms in Wall Street from October 9, 2007 to September 11, 2009.

The Economist’s Buttonwood has recently posted an interactive map showing global indebtedness, from 1999 to 2011. It’s worth visiting.


Stabel P. and Haemers J. (2006) Financial revolution: the supply side story (… almost)

September 12, 2009

Stabel, Peter and Jelle Haemers (2006) “From Bruges to Antwerp. International commercial firms and government’s credit in the late 15th and early 16th century”, in Banca, Crédito y Captial. La Monarquía Hispánica y los antiguos Países Bajos (1505-1700), eds. Carmen Sanz Ayán and Bernardo J. García García, Madrid: Fundación Carlos de Amberes, p.20-38.

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Introduction

The Financial Revolution – i. e. the gradual increase of government spending made possible by an increasing reliance on loans obtained from the capital markets – has essentially been studied from the side of the public demand. The ability of the markets to match this demand being regarded almost as a given. Meanwhile the impact the governments’ enormous financial needs may have had on private finance have hardly been addressed (p.22). Read the rest of this entry »


Frehen R., Goetzmann W. and Rouwenhorst G. (2009) Why invest in the bubbles?

August 31, 2009

Frehen, Rik, William Goetzmann and Geert Rouwenhorst (2009) “New Evidence on the First Financial Bubbles”, Yale international Center for Finance, Working Paper 04, 24p.

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This article is available online.

Why did investors decide to bet on the various companies that would form the three 1720 bubbles in France, England and the Netherlands? (p.1). How did these bubbles affect companies which unlike the Compagnie des Indes and the South Sea Company were neither involved in the Atlantic trade nor in public finance?

Read the rest of this entry »


Flandreau M. et al. (2009) The question was not how to develop finance

August 30, 2009

Flandreau, Marc, Christophe Galimard, Clemens Jobst and Pilar Nogués-Marco (2009) “The bell-jar: commercial interest rates betwee two revolutions” in The Origin and Development of Financial Markets and Institutions. From the Seventeenth Century to the Present, eds. Jeremy Atack and Larry Neal, Cambridge: Cambridge University Press, 161-208.

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An earlier version of this paper is available here.

For institutionalist economists as well as for contemporary commentators, the wealth of nations in 18th century Europe was rooted in their political system which influenced the level of interest rates and thus trade (p.165). The confidence investors had in the government’s credit was thus seen as critical (tellingly John Law’s primary aim was to bring interest rates down; p.166). Read the rest of this entry »


Glorious Revolution Week, the end: are institutional economics a gamy theory?

August 15, 2009

The Glorious Revolution is a cardinal event in the eyes of modern economic historiography. Not only did it provide the setting for the Industrial Revolution, but it also became a textbook example of the impact of institutional change upon the economy. The 1989 article by North and Weingast is said to be the most quoted in the discipline. Indeed it formalized the process of historical change, but also strongly hinted at what good institutions should be. Read the rest of this entry »


North D. and Weingast B. (1989) The economic impact of institutions

August 14, 2009

North, Douglass C. and Barry Weingast (1989) “Constitution and Commitment: The Evolution of Institutional Governing Public Choice in Seventeenth-Century England”, The Journal of Economic History, 49/4: 803-832.

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Disclaimer: this summary is written by the contributors of the blog and not by the author of the article. Any mistake is Manuel’s fault (and he shall be punished).

“Put simply, successful long-run economic performance requires appropriate incentives not only for economic actors but for political actors as well. Because the state has a comparative advantage in coercion, what prevents it from using violence to extract all the surplus?” Read the rest of this entry »