Blogwatch: January 2023

Regressive cigarette taxes, slavery, economic consequences of war, & other fields/topics

Postwar Monetary Policy

At the Alt-M blog, George Selgin’s seemingly never-ending series of posts on “The New Deal and Recovery” reaches an eye-watering part 22! Selgin discusses Postwar Monetary Policy.

Might the postwar economy have been kept humming with the help of generous doses of easy money? Could that have been all it really needed to prosper again?

The Williams thesis

Davis Kedrosky has a trilogy of articles on the ‘Williams Thesis’ planned at the Great Transformations blog. Roughly, Eric Williams argued that slavery catalysed British industrialization during the 18th century, and it was only once manufacturers no longer needed the West Indian plantations that slavery, now obsolete, was abolished. Part I covers the debate on the Williams Thesis up to the late 1980s. The second part considers the debates among economic historians since 1990, focusing especially on exchanges between Harley, Findlay and O’Rourke, McCloskey, and Zahedieh. The third part is yet to be posted.

Liberalism vs. the New Right

At the Marginal Revolution blog, economist Tyler Cowen discusses Classical liberalism vs. The New Right. Cowen considers where classical liberalism differs from what he calls the “New Right”. By the New Right Cowen means …

alternatives that don’t yet have a common name. Some are called “national conservatism,” and some (by no means all) strands are pro-Trump… My use of the term covers a broad range of sources, from Curtis Yarvin to J.D. Vance to Adrian Vermeule to Sohrab Ahmari to Rod Dreher to Tucker Carlson, and also a lot of anonymous internet discourse.

Coordination and organisation design

At the American Economic Association website, the question is asked, How does the need for coordination affect organization design?

Demand uncertainty is generally considered to be the central driver of this organizational choice. Locations with greater variability provide lower-level managers—those close to the facts on the ground—with greater empowerment to make decisions. But, in a paper in the American Economic Journal: Microeconomics, authors Wouter Dessein, Desmond (Ho-Fu) Lo, and Chieko Minami show that if coordination within a business is crucial to success, centralization will actually be higher when local volatility is high.

Regressive taxation

Another post on the AEA website asks How regressive are cigarette taxes? The research discussed emphasises the disproportionate burden cigarette taxation places on lower-income groups. It is shown that while the taxes on cigarettes have increased and smoking rates have decreased over time, these taxes have become more regressive.

Preference or information?

In a VoxEU.org column, Melanie Wasserman and Yana Gallen argue that information eliminates female students’ preference for female mentors. The column explains that female students disproportionately reach out to female mentors — not out of the desire for someone with the same characteristics as them, but rather from a lack of other information about the mentors’ abilities. The column finds that female students do not value a mentor’s gender per se, but use gender as a proxy when no direct information about quality is available.

Outstanding in your field … or topic?

On the history of economics dispatch blog, Beatrice Cherrier confesses I spend a lot of time chasing the history of economic “fields”. Maybe I shouldn't. Maybe she shouldn’t but in the course of doing so she asks an interesting question, “when is an economic field a ‘field’, and not just a ‘topic’?” She continues,

What distinguishes fields from topics, I think, is foremost a sense of permanence. Topics are tied to new phenomena to explain, new questions to answer and most importantly, new problems to solve. Growth, unemployment, inflation, competition, development are old topics. Race, covid, inequality, crime, climate change are newer ones. A topic gets institutionalized as a field when it becomes clear that the problem or phenomenon is of permanent interest.

So, I find myself asking, Is organisational economics a topic or a field? What of the history of thought to do with organisational economics, field or topic?

Yoram Barzel

The Department of Economics at the University of Washington and The Seattle Times give obituaries of Yoram Barzel here and here. Barzel is well known as an economic theorist in the fields of property rights and transaction costs. Brian Albrecht at Economic Forces asks, Are Transaction Costs just Costs? as a tribute to Barzel.

Barzel as one of the three giants of property rights economics, alongside Armen Alchian and Harold Demsetz.

Maybe Ronald Coase should make the list as well.

Russian pre-1885: growth or not?

Again at VoxEU.org Elena Korchmina and Stephen Broadberry consider Catching-up and falling behind: Russian economic growth, 1690s–1880s.

A lack of pre-1885 GDP data has kept Russia out of debates over the gap in GDP per capita between northwest Europe and other regions of the continent. This column introduces decadal estimates of GDP per capita for the Russian Empire for the 1690s to the 1880s, making it possible to compare one of the world’s largest economies with others. Significant economic growth before the 1760s allowed Russia to catch up with northwest Europe. However, negative growth in the 1760s to 1800s and stagnation in 1800s to 1880s left late-19th century Russia further behind the West than at the beginning of the 18th century.

Mergers: policy or political football?

At the Network Law Review, Dennis Carlton asks the question, How to make sensible merger policies? Carlton wants merger policy to be rescued from being used as a political football. It's not about politicians getting elected. To avoid this chicanery, Carlton argues that someone has to take charge, figure out what the evidence shows about the effects of merger policy on the economy, and having done this, alter merger policy if there is a need to do so. He sees the economists at places like the FTC and Department of Justice as being those who are best suited to do this. He goes on to argue

I disagree with those who claim that economics has put antitrust on the wrong track. Not only has economics improved antitrust policy, there is also a lot more that economists can do to improve antitrust decision-making and specifically merger policy.

War (What is it good for)

In a third column at VoxEU.org, Zsoka Koczan and Maxim Chupilkin look at the topical subject of the economic consequences of war. They use a data set that covers nearly 400 wars over the past two centuries. Their findings are

that wars fought on a nation’s own territory result in significant GDP per-capita loss; civil wars have more persistent effects than interstate wars; and certain kinds of conventional research may have significantly understated the long-term economic scars of war.

By Paul Walker