Welcome to The Long Run

On behalf of the Economic History Society (EHS), it is a pleasure to welcome you to The Long Run, the EHS blog.

This blog aims to encourage discussion of economic and social history, broadly defined. We live in a time of major social and economic change, and research in social science is showing more and more that a historical and long-term approach to current issues is the key to understanding our times.

We welcome any contribution or suggestion – please contact us at ehs.thelongrun@gmail.com

 

British perceptions of German post-war industrial relations

By Colin Chamberlain (University of Cambridge)

Some 10,000 steel workers participate in a demonstration to demand a 10 per...
A demonstration in Stuttgart, 11th January 1962.  Picture alliance/AP Images, available at <https://www.gewerkschaftsgeschichte.de/1953-schwerpunkt-tarifpolitik.html&gt;

‘Almost idyllic’ – this was the view of one British commentator on the state of post-war industrial relations in West Germany. No one could say the same about British industrial relations. Here, industrial conflict grew inexorably from year to year, forcing governments to expend ever more effort on preserving industrial peace.

Deeply frustrated, successive governments alternated between appeasing trade unionists and threatening them with new legal sanctions in an effort to improve their behaviour, thereby avoiding tackling the fundamental issue of their institutional structure. If the British had only studied the German ‘model’ of industrial relations more closely, they would have understood better the reforms that needed to be made.

Britain’s poor state of industrial relations was a major, if not the major, factor holding back Britain’s economic growth, which was regularly less than half the rate in Germany, not to speak of the chronic inflation and balance of payments problems that only made matters worse. So, how come the British did not take a deeper look at the successful model of German industrial relations and learn any lessons?

Ironically, the British were in control of Germany at the time the trade union movement was re-establishing itself after the war. The Trades Union Congress and the British labour movement offered much goodwill and help to the Germans in their task.

But German trade unionists had very different ideas to the British trade unions on how to go about organising their industrial relations, ideas that the British were to ignore consistently over the post-war period. These included:

    • In Britain, there were hundreds of trade unions, but in Germany, there were only 16 re-established after the war, each representing one or more industries, thereby avoiding the demarcation disputes so common in Britain.
    • Terms and conditions were negotiated on this industry-basis by strong well-funded trade unions, which welcomed the fact that their two or three year long collective agreements were legally enforceable in Germany’s system of industrial courts.
    • Trade unions were not involved in workplace grievances and disputes. These were left to employees and managers meeting together in Germany’s highly successful works councils to resolve such issues informally along with engaging in consultative exercises on working practices and company reorganisations. As a result, German companies did not seek to lay-off staff as British companies did on any fall in demand, but rathet to retrain and reallocate them.

British trade unions pleaded that their very untidy institutional structure with hundreds of competing trade unions was what their members actually wanted and should therefore be outside any government interference. The trade unions jealously guarded their privileges and especially rejected any idea of industry-based unions, legally enforceable collective agreements and works councils.

A heavyweight Royal Commission was appointed, but after three years’ deliberation, it came up with little more than the status quo. It was reluctant to study any ideas emanating from Germany.

While the success of industrial relations in Germany was widely recognised in Britain, there was little understanding about why this was so or indeed much interest in it. The British were deeply conservative about the ‘institutional shape’ of industrial relations and had a fear of putting forward any radical German ideas. Britain was therefore at a big disadvantage as far as creating modern trade unions operating in a modern state.

So, what economic price the failure to sort out the institutional structure of the British trade unions?

Transatlantic Slavery and Abolition: a Pan-European Affair

By Felix Brahm (German Historical Institute London) and Eve Rosenhaft (University of Liverpool)

Slavery Hinterland. Transatlantic Slavery and Continental Europe, 1680–1850 is published by Boydell Press for the Economic History Society’s series ‘People, Markets, Goods: Economies and Societies in History’. SAVE 25% when you order direct from the publisher -offer ends on the 28th June 2018. See below for details.

 

coverThe history of transatlantic slavery is one of the most active and fruitful fields of international historical research, and an important lesson of the latest work on maritime countries like Britain and France is that there the profits of slavery and indeed abolition ‘trickled down’ to very wide sections of the population and to places well away from the principal slave-trading ports. Recently historians have started to look beyond the familiar Atlantic axis and to apply the same paradigm to the European hinterlands of the triangular trade. That is, they have sought its traces and impacts in territories that were not directly involved (or were relatively minor participants) in the traffic in Africans: the German-speaking countries, Scandinavia, Italy and Central Europe. And they are finding that the slave trade, the plantation economies that it fed, the consequences of its abolition, and not least the questions of moral and political principle that it threw up, were very much a part of the texture of society right across Europe.

In material terms, it is clear that the manufacture of trade goods – the wares with which Europeans paid African traders for the enslaved men, women and children whom they then shipped to the Americas – was an important element of many regional economies. Firearms, iron bars and ironware travelled from Denmark and the Baltic to Western Europe’s slaving ports. Glass beads were exported from Bohemia (the Czech lands), and the higher quality Venetian products attracted Liverpool merchants to set up branch offices in Italy to secure their supply. The Swiss family firm Burckhardt/Bourcard began by supplying cotton cloth for the slave trade and importing slave-produced luxury goods and moved into equipping its own slaving ships. Textile plants in the Wupper Valley in Western Germany and the hand looms of Eastern Prussia provided linens of varying quality for use on the slave plantations, though because they were shipped through English and Dutch ports their German origins have often been obscured. And the trading networks established in the context of the slave economy supported German exporting projects even after the trade was abolished, as German firms continued to trade into territories – Brazil and the Caribbean – where slavery persisted until the late 19th century.

Germans in particular were keen observers of the Atlantic slave economy, and they had their own perspective on international debates about the trade and its abolition. At the beginnings of the trade, the rulers of Brandenburg Prussia had some hopes of buying into it, establishing a slave fort on the Gold Coast between 1682 and 1720. One of the key documents of this episode is the diary of a ship’s barber, Johann Peter Oettinger, who sailed on slaving expeditions. He chose to make no comment about the brutalities that he witnessed and recorded. Characteristically, though, when the diaries were published for German readers 200 years later, they were given a moralising spin; by the 1880s, Germany was at the forefront of the Scramble for Africa, justifying colonisation in the name of suppressing the internal slave trade. Before that, and once the German states were no longer involved in the slave trade, German-speaking scientists and administrators placed themselves in the service of those states that were: Ernst Schimmelmann, whose family had one foot in Hamburg and one in Copenhagen, was a plantation owner and manager of the Swedish state slaving company, but also responsible for the abolition of the Danish slave trade in 1792. And initiatives for the post-abolition exploitation of tropical territories relied on the work of German scientists in service to the Danish state like the botanist Julius von Rohr.

Scholarly attention to the German case is also bringing the Atlantic plantation economies into dialogue with the practices of unfree labour that existed in Central Europe at the same time. Analysis of the conditions of linen production on eastern Prussia’s aristocratic estates indicates that their low production costs helped to keep down the costs of production on slave plantations. And when Germans confronted the moral and legal challenges to slavery that were crystallising into a political movement in Britain and France by the 1790s, they could not escape the implications of abolitionist arguments for the future of their own ‘peculiar institutions’ of serfdom and personal service. This was true of Theresa Huber, the author and journalist who stands for two generations of Germans who engaged in transnational abolitionist networks, and who was equally sharp in her critique of serfdom. And it was true of Prussian administrators who, when challenged by enslaved Africans on German soil to enforce the notion that ‘there are no slaves in Prussia’, could not help asking themselves what that might mean for the process towards reform of feudal institutions.

These issues have only begun to receive greater attention – more studies are needed to gain a clearer understanding of the various links through which continental Europe was connected to the Transatlantic slave business and its abolition.

 

SAVE 25% when you order direct from the publisher using the offer code BB500 in the box at the checkout. Discount applies to print and eBook editions. Alternatively call Boydell’s distributor, Wiley, on 01243 843 291, and quote the same code. Offer ends on the 28th June 2018. Any queries please email marketing@boydell.co.uk

 

To contact the authors:
Felix Brahm (brahm@ghil.ac.uk);
Eve Rosenhaft (Dan85@liverpool.ac.uk)

From VoxEU – Wellbeing inequality in retrospect

Rising trends in GDP per capita are often interpreted as reflecting rising levels of general wellbeing. But GDP per capita is at best a crude proxy for wellbeing, neglecting important qualitative dimensions. 36 more words

via Wellbeing inequality in retrospect — VoxEU.org: Recent Articles

To elaborate further on the topic, Prof. Leandro de la Escosura has made available several databases on inequality, accessible here, as well as a book on long-term Spanish economic growth, available as open source here

 

THE FINANCIAL POWER OF THE POWERLESS: Evidence from Ottoman Istanbul on socio-economic status, legal protection and the cost of borrowing

In Ottoman Istanbul, privileged groups such as men, Muslims and other elites paid more for credit than the under-privileged – the exact opposite of what happens in a modern economy.

New research by Professors Timur Kuran (Duke University) and Jared Rubin (Chapman University), published in the March 2018 issue of the Economic Journal, explains why: a key influence on the cost of borrowing is the rule of law and in particular the extent to which courts will enforce a credit contract.

In pre-modern Turkey, it was the wealthy who could benefit from judicial bias to evade their creditors – and who, because of this default risk, faced higher interest rates on loans. Nowadays, it is under-privileged people who face higher borrowing costs because there are various institutions through which they can escape loan repayment, including bankruptcy options and organisations that will defend poor defaulters as victims of exploitation.

In the modern world, we take it for granted that the under-privileged incur higher borrowing costs than the upper socio-economic classes. Indeed, Americans in the bottom quartile of the US income distribution usually borrow through pawnshops and payday lenders at rates of around 450% per annum, while those in the top quartile take out short-term loans through credit cards at 13-16%. Unlike the under-privileged, the wealthy also have access to long-term credit through home equity loans at rates of around 4%.

The logic connecting socio-economic status to borrowing costs will seem obvious to anyone familiar with basic economics: the higher costs of the poor reflect higher default risk, for which the lender must be compensated.

The new study sets out to test whether the classic negative correlation between socio-economic status and borrowing cost holds in a pre-modern setting outside the industrialised West. To this end, the authors built a data set of private loans issued in Ottoman Istanbul during the period from 1602 to 1799.

These data reveal the exact opposite of what happens in a modern economy: the privileged paid more for credit than the under-privileged. In a society where the average real interest rate was around 19%, men paid an interest surcharge of around 3.4 percentage points; Muslims paid a surcharge of 1.9 percentage points; and elites paid a surcharge of about 2.3 percentage points (see Figure 1).

pic

What might explain this reversal of relative borrowing costs? Why did socially advantaged groups pay more for credit, not less?

The data led the authors to consider a second factor contributing to the price of credit, often taken for granted: the partiality of the law. Implicit in the logic that explains relative credit costs in modern lending markets is that financial contracts are enforceable impartially when the borrower is able to pay. Thus, the rich pay less for credit because they are relatively unlikely to default and because, if they do, lenders can force repayment through courts whose verdicts are more or less impartial.

But in settings where the courts are biased in favour of the wealthy, creditors will expect compensation for the risk of being unable to obtain restitution. The wealth and judicial partiality effects thus work against each other. The former lowers the credit cost for the rich; the latter raises it.

Islamic Ottoman courts served all Ottoman subjects through procedures that were manifestly biased in favour of clearly defined groups. These courts gave Muslims rights that they denied to Christians and Jews. They privileged men over women.

Moreover, because the courts lacked independence from the state, Ottoman subjects connected to the sultan enjoyed favourable treatment. Theory developed in the new study explains why their weak legal power may translate into strong financial power.

More generally, this research suggests that in a free financial market, any hindrance to the enforcement of a credit contract will raise the borrower’s credit cost. Just as judicial biases in favour of the wealthy raise their interest rates on loans, institutions that allow the poor to escape loan repayment – bankruptcy options, shielding of assets from creditors, organisations that defend poor defaulters as victims of exploitation – raise interest rates charged to the poor.

Today, wealth and credit cost are negatively correlated for multiple reasons. The rich benefit both from a higher capacity to post collateral and from better enforcement of their credit obligations relative to those of the poor.

 

To contact the authors:
Timur Kuran (t.kuran@duke.edu); Jared Rubin (jrubin@chapman.edu)

Perpetuating the family name: female inheritance, in-marriage and gender norms

by Duman Bahrami-Rad (Simon Fraser University)

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Tartanspartan: Muslim wedding, Lahore, Pakistan — Frank Horvat, 1952. Available on Pinterest <https://www.pinterest.co.uk/pin/491947959265621479/&gt;

Why is it so common for Muslims to marry their cousins (more than 30% of all marriages in the Middle East)? Why, despite explicit injunctions in the Quran to include women in inheritance, do women in the Middle East generally face unequal gender relations, and their labour force participation remain the lowest in the world (less than 20%)?

This study presents a theory, supported by empirical evidence, concerning the historical origins of such marriage and gender norms. It argues that in patrilineal societies that nevertheless mandate female inheritance, cousin marriage becomes a way to preserve property in the male line and prevent fragmentation of land.

In these societies, female inheritance also leads to the seclusion and veiling of women as well as restrictions on their sexual freedom in order to encourage cousin marriages and avoid out-of-wedlock children as potential heirs. The incompatibility of such restrictions with female participation in agriculture has further influenced the historical gender division of labour.

Analyses of data on pre-industrial societies, Italian provinces, and women in Indonesia show that female inheritance, consistent with these hypotheses, is associated with lower female labour participation, greater stress on female virginity before marriage and higher rates of endogamy, consanguinity and arranged marriages.

The study also uses the recent reform of inheritance regulations in India – which greatly enhanced Indian women’s right to inherit property – to provide further evidence of the causal impact of female inheritance. The analysis shows that among women affected by the reform, the rate of cousin marriage is significantly higher, and that of premarital sex significantly lower.

The implications of these findings are important. It is believed that cousin marriage helps create and maintain kinship groups such as tribes and clans, which impair the development of an individualistic social psychology, undermine social trust, large-scale cooperation and democratic institutions, and encourage corruption and conflict.

This study contributes to this literature by highlighting a historical origin of clannish social organisation. It also sheds light on the origins of gender inequality as both a human rights issues and a development issue.

Winning the capital, winning the war: retail investors in the First World War

by Norma Cohen (Queen Mary University of London)

 

Put_it_into_National_War_Bonds
National War Savings CommitteeMcMaster University Libraries, Identifier: 00001792. Available at wikimedia commons

The First World War brought about an upheaval in British investment, forcing savers to repatriate billions of pounds held abroad and attracting new investors among those living far from London, this research finds. The study also points to declining inequality between Britain’s wealthiest classes and the middle class, and rising purchasing power among the lower middle classes.

The research is based on samples from ledgers of investors in successive War Loans. These are lodged in archives at the Bank of England and have been closed for a century. The research covers roughly 6,000 samples from three separate sets of ledgers of investors between 1914 and 1932.

While the First World War is recalled as a period of national sacrifice and suffering, the reality is that war boosted Britain’s output. Sampling from the ledgers points to the extent to which war unleashed the industrial and engineering innovations of British industry, creating and spreading wealth.

Britain needed capital to ensure it could outlast its enemies. As the world’s capital exporter by 1914, the nation imposed increasingly tight measures on investors to ensure capital was used exclusively for war.

While London was home to just over half the capital raised in the first War Loan in 1914, that had fallen to just under 10% of capital raised in the years after. In contrast, the North East, North West and Scotland – home to the mining, engineering and shipbuilding industries – provided 60% of the capital by 1932, up from a quarter of the total raised by the first War Loan.

The concentration of investor occupations also points to profound social changes fostered by war. Men describing themselves as ‘gentleman’ or ‘esquire’ – titles accorded those wealthy enough to live on investment returns – accounted for 55% of retail investors for the first issue of War Loan. By the post-war years, these were 37% of male investors.

In contrast, skilled labourers – blacksmiths, coal miners and railway signalmen among others– were 9.0% of male retail investors by the after-war years, up from 4.9% in the first sample.

Suppliers of war-related goods may not have been the main beneficiaries of newly-created wealth. The sample includes large investments by those supplying consumer goods sought by households made better off by higher wages, steady work and falling unemployment during the war.

During and after the war, these sectors were accused of ‘profiteering’, sparking national indignation. Nearly a quarter of investors in 5% War Loan listing their occupations as ‘manufacturer’ were producing boots and leather goods, a sector singled out during the war for excess profits. Manufacturers in the final sample produced mineral water, worsteds, jam and bread.

My findings show that War Loan was widely held by households likely to have had relatively modest wealth; while the largest concentration of capital remained in the hands of relatively few, larger numbers had a small stake in the fate of the War Loans.

In the post-war years, over half of male retail investors held £500 or less. This may help to explain why efforts to pay for war by taxing wealth as well as income – a debate that echoes today – proved so politically challenging. The rentier class on whom additional taxation would have been levied may have been more of a political construct by 1932 than an actual presence.

 

Medieval origins of Spain’s economic geography

The frontier of medieval warfare between Christian and Muslim armies in southern Spain provides a surprisingly powerful explanation of current low-density settlement patterns in those regions. This is the central finding of research by Daniel Oto-Peralías (University of Saint-Andrews), recently presented at the Royal Economic Society’s annual conference in March 2018.

 His study notes that Southern Spain is one of the most deserted areas in Europe in terms of population density, only surpassed by parts of Iceland and the northern part of Scandinavia. It turns out that this outcome has roots going back to medieval times when Spain’s southern plateau was a battlefield between Christian and Muslim armies.

The study documents that Spain stands out in Europe with an anomalous settlement pattern characterised by a very low density in its southern half. Among the ten European regions with the lowest settlement density, six are from southern Spain (while the other four are from Iceland, Norway, Sweden and Finland).

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On average only 29.8% of 10km2 grid cells are inhabited in southern Spain, which is a much lower percentage than in the rest of Europe (with an average of 74.4%). Extreme geographical and climatic conditions do not seem to be the reason for this low settlement density, which the author refers to as ‘Spanish anomaly’.

After ruling out geography as the main explanatory factor for the ‘Spanish anomaly’, the research investigates its historical roots by focusing on the Middle Ages, when the territory was retaken by the Christian kingdoms from Muslim rule.

The hypothesis is that the region’s character as a militarily insecure frontier conditioned the colonisation of the territory, which is tested by taking advantage of the geographical discontinuity in military insecurity created by the Tagus River in central Spain. Historical ‘accidents’ made the colonisation of the area south of the Tagus River very different from colonisation north of it.

The invasions of North Africa’s Almoravid and Almohad empires converted the territory south of the Tagus into a battlefield for a century and a half, this river being a natural defensive border. Continuous warfare and insecurity heavily conditioned the nature of the colonisation process in this frontier region, which was characterised by the leading role of the military orders as agents of colonisation, scarcity of population and a livestock-oriented economy. It resulted in the prominence of castles and the absence of villages, and consequently, a spatial distribution of the population characterised by a very low density of settlements.

The empirical analysis reveals a large difference in settlement density across the River Tagus, whereas there are no differences in geographical and climatic variables across it. In addition, it is shown that the discontinuity in settlement density already existed in the 16th and 18th centuries, and is not therefore the result of migration movements and urban developments taking place recently. Preliminary evidence also indicates that the territory exposed to the medieval ranching frontier is relatively poorer today.

Thus, the study shows that historical frontiers can decisively shape the economic geography of countries. Using Medieval Spain as a case study, it illustrates how the exposure to warfare and insecurity – typical in medieval frontiers– creates incentives for a militarised colonisation based on a few fortified settlements and a livestock-oriented economy, conditioning the occupation of a territory to such an extent to convert it into one of the most deserted areas in Europe. Given the ubiquity of frontiers in history, the mechanisms underlined in the analysis are of general interest and may operate in other contexts.

THE IMPACT OF MALARIA ON EARLY AFRICAN DEVELOPMENT: Evidence from the sickle cell trait

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poster “Keep out malaria mosquitoes repair your torn screens”. U.S. Public Health Service, 1941–45

While malaria historically claimed millions of African lives, it did not hold back the continent’s economic development. That is one of the findings of new research by Emilio Depetris-Chauvin (Pontificia Universidad Católica de Chile) and David Weil (Brown University), published in the Economic Journal.

Their study uses data on the prevalence of the gene that causes sickle cell disease to estimate death rates from malaria for the period before the Second World War. They find that in parts of Africa with high malaria transmission, one in ten children died from malaria or sickle cell disease before reaching adulthood – a death rate more than twice the current burden of malaria in these regions.

 

According to the World Health Organization, the malaria mortality rate declined by 29% between 2010 and 2015. This was a major public health accomplishment, although with 429,000 annual deaths, the disease remains a terrible scourge.

Countries where malaria is endemic are also, on average, very poor. This correlation has led economists to speculate about whether malaria is a driver of poverty. But addressing that issue is difficult because of a lack of data. Poverty in the tropics has long historical roots, and while there are good data on malaria prevalence in the period since the Second World War, there is no World Malaria Report for 1900, 1800 or 1700.

Biologists only came to understand the nature of malaria in the late nineteenth century. Even today, trained medical personnel have trouble distinguishing between malaria and other diseases without the use of microscopy or diagnostic tests. Accounts from travellers and other historical records provide some evidence of the impact of malaria going back millennia, but these are hardly sufficient to draw firm conclusions. Akyeampong (2006), Mabogunje and Richards (1985)

This study addresses the lack of information on malaria’s impact historically by using genetic data. In the worst afflicted areas, malaria left an imprint on the human genome that can be read today.

Specifically, the researchers look at the prevalence of the gene that causes sickle cell disease. Carrying one copy of this gene provided individuals with a significant level of protection against malaria, but people who carried two copies of the gene died before reaching reproductive age.

Thus, the degree of selective pressure exerted by malaria determined the equilibrium prevalence of the gene in the population. By measuring the prevalence of the gene in modern populations, it is possible to back out estimates of the severity of malaria historically.

In areas of high malaria transmission, 20% of the population carries the sickle cell trait. The researchers’ estimate is that this implies that historically 10-11% of children died from malaria or sickle cell disease before reaching adulthood. Such a death rate is more than twice the current burden of malaria in these regions.

Comparing the most affected areas with those least affected, malaria may have been responsible for a ten percentage point difference in the probability of surviving to adulthood. In areas of high malaria transmission, the researchers’ estimate that life expectancy at birth was reduced by approximately five years.

Having established the magnitude of malaria’s mortality burden, the researchers then turn to its economic effects. Surprisingly, they find little reason to believe that malaria held back development. A simple life cycle model suggests that the disease was not very important, primarily because the vast majority of deaths that it caused were among the very young, in whom society had invested few resources.

This model-based finding is corroborated by the findings of a statistical examination. Within Africa, areas with higher malaria burden, as evidenced by the prevalence of the sickle cell trait, do not show lower levels of economic development or population density in the colonial era data examined in this study.

 

To contact the authors:  David Weil, david_weil@brown.edu

EFFECTS OF COAL-BASED AIR POLLUTION ON MORTALITY RATES: New evidence from nineteenth century Britain

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Samuel Griffiths (1873) The Black Country in the 1870s. In Griffiths’ Guide to the iron trade of Great Britain.

Industrialised cities in mid-nineteenth century Britain probably suffered from similar levels of air pollution as urban centres in China and India do today. What’s more, the damage to health caused by the burning of coal was very high, reducing life expectancy by more than 5% in the most polluted cities like Manchester, Sheffield and Birmingham. It was also responsible for a significant proportion of the higher mortality rates in British cities compared with rural parts of the country.

 These are among the findings of new research by Brian Beach (College of William & Mary) and Walker Hanlon (NYU Stern School of Business), which is published in the Economic Journal. Their study shows the potential value of history for providing insights into the long-run consequences of air pollution.

From Beijing to Delhi and Mexico City to Jakarta, cities across the world struggle with high levels of air pollution. To what extent does severe air pollution affect health and broader economic development for these cities? While future academics will almost surely debate this question, assessing the long-run consequences of air pollution for modern cities will not be possible for decades.

But severe air pollution is not a new phenomenon; Britain’s industrial cities of the nineteenth century, for example, also faced very high levels of air pollution. Because of this, researchers argue that history has the potential to provide valuable insights into the long-run consequences of air pollution.

One challenge in studying historical air pollution is that direct pollution measures are largely unavailable before the mid-twentieth century. This study shows how historical pollution levels in England and Wales can be inferred by combining data on the industrial composition of employment in local areas in 1851 with information on the amount of coal used per worker in each industry.

This makes it possible to estimate the amount of coal used in over 581 districts covering all of England and Wales. Because coal was by far the most important pollutant in Britain in the nineteenth century (as well as much of the twentieth century), this provides a way of approximating local industrial pollution emission levels.

The results are consistent with what historical sources suggest: the researchers find high levels of coal use in a broad swath of towns stretching from Lancashire and the West Riding down into Staffordshire, as well as in the areas around Newcastle, Cardiff and Birmingham.

By comparing measures of local coal-based pollution to mortality data, the study shows that air pollution was a major contributor to mortality in Britain in the mid-nineteenth century. In the most polluted locations – places like Manchester, Sheffield and Birmingham – the results show that air pollution resulting from industrial coal use reduced life expectancy by more than 5%.

One potential concern is that locations with more industrial coal use could have had higher mortality rates for other reasons. For example, people living in these industrial areas could have been poorer, infectious disease may have been more common or jobs may have been more dangerous.

The researchers deal with this concern by looking at how coal use in some parts of the country affected mortality in other areas that were, given the predominant wind direction, typically downwind. They show that locations which were just downwind of major coal-using areas had higher mortality rates than otherwise similar locations which were just upwind of these areas.

These results help to explain why cities in the nineteenth century were much less healthy than more rural areas – the so-called urban mortality penalty. Most existing work argues that the high mortality rates observed in British cities in the nineteenth century were due to the impact of infectious diseases, bad water and unclean food.

The new results show that in fact about one third of the higher mortality rate in cities in the nineteenth century was due to exposure to high levels of air pollution due to the burning of coal by industry.

In addition to assessing the effects of coal use on mortality, the researchers use these effects to back out very rough estimates of historical particulate pollution levels. Their estimates indicate that by the mid-nineteenth century, industrialised cities in Britain were probably as polluted as industrial cities in places like China and India are today.

These findings shed new light on the impact of air pollution in nineteenth century Britain and lay the groundwork for further research analysing the long-run effects of air pollution in cities.

 

To contact the authors:  Brian Beach (bbbeach@wm.edu); Walker Hanlon (whanlon@stern.nyu.edu)

IMPERIAL ROOTS OF TODAY’S GLOBAL TRADE: Evidence from 140 empires

by Wessel Vermeulen (Newcastle University), Gunes Gokmen (New Economic School, Moscow), and Pierre-Louis Vézina (King’s College London)

 

trade__commerce_in_greek_city-states__the_mediterranean_region_thumbnail0_140051.jpg

The rise and fall of empires over the last 5,000 years – from the Afsharid Dynasty to the British Empire – still influences world trade patterns today.

Their new data on the rise and fall of 140 empires across the world over the last 5,000 years reveals that present-day trade flows between countries that were once in a common empire are on average 70% larger than that between unrelated countries.

Empires facilitated trade within their controlled territories by building and securing trade and migration routes, and by imposing common languages, religions and legal systems. This led to the accumulation of ‘trading capital’, which outlives empires and shapes today’s trade patterns.

Throughout history, many empires were essentially created to facilitate trade; the Athenian Empire was established to secure food trade between Athens and Crimea.

Imperial formal and informal institutions as well as physical infrastructure might have played a role in the growth of trading capital and thus in shaping today’s trade patterns. For example:

  • Local institutions that emerged to support inter-ethnic medieval trade have resulted in a sustained legacy of ethnic tolerance in South Asian port towns.
  • Historical Habsburg-Empire regions have higher current trust and lower corruption than neighbouring regions, probably due to the empire’s well-respected administration, and countries of the empire trade significantly more with one another than with other neighbours.
  • Long-established commercial diasporas such as the Gujaratis in the British Empire still play an important role in world trade.

A novel dataset on countries’ imperial history going back 5,000 years makes it possible to measure this accumulated trading capital for all countries around the world and over the entire history of civilisations. In turn, it makes it possible to estimate its effect on trade today.

Imports from countries that were once in a common empire are on average 70% larger. The estimation in this study accounts for other important factors such as distance, shared borders, common legal systems, and genetic and linguistic distances. The effect of trading capital is related to but not entirely explained by these factors.

Some empires matter more than others. Trading capital builds up in times of common empire and depreciates slowly at other times. Hence, longer-lasting and recent empires matter most.

Trade is a major driver of economic growth without which isolated countries find it much harder to prosper. These results suggest that trading capital plays a role in reducing the trade costs that inhibit international trade.

While infrastructure such as roads or railways do promote trade, we know that transport costs do not account for most of the trade costs associated with borders and distance. Instead, cultural and informational frictions are the main culprits. Trading capital accumulated during empires could thus play an important role in making trade happen today.