Sunday, January 22, 2012

jeremy adelman on hirschman

Hirschman's "Rival Views" is a fascinating look at the
origins of moral and political critiques of capitalism
The following excerpt is from a "flavor essay", so to speak, of a forthcoming biography (by Jeremy Adelman) of one of the most interesting and important thinkers in institutional economics and political economy of the last century: Albert O. Hirschman. Hirschman is perhaps most popular for Exit, Voice, and Loyalty, which is a highly original discussion of how individuals behave in political and economic relationships. The following excerpts is from his early years at the Institute for Advanced Study at Princeton, in the 1970s. A very interesting story indeed:

Several weeks later, [Hirschman] walked before the podium in Dodds Auditorium at Princeton University to deliver the Janeway Lectures to large crowds of students and faculty on the theme of “Private and Public Happiness: Pursuits and Disappointments.” For Hirschman there was no basic choice between the two types of happiness; it was not “or” that conjoined public to private. If there was a choice, the point of the lectures was to argue that people were always choosing depending on their moods and inclinations, and it was this activity that Hirschman wanted to draw out. Hirschman’s Janeway Lectures addressed experiences and emotional responses to them—anger at educational institutions, self-incrimination for buying a large house and regretting it (“buyer’s remorse”), and the ever disappointing “driving experience,” which, far from yielding to the lyrical joy ride, more often plunged the BMW-driving pleasure-seeker into traffic jams and car payments. Pursuits of happiness wherever it was being dispensed left trails of disappointment.
In contrast to Olson’s “logic,” Hirschman presented a “dialectic” that unfolds within the self, a self comprised of a complex amalgam of drives. Hirschman’s pendular dialectic was the theme of Shifting Involvements: Private Interest and Public Action (Princeton University Press, 1982), in which he stuck his neck out to formulate an alternative to the gathering political and intellectual orthodoxy. “I have rarely felt so uncertain about a product of mine,” he told his daughter Katia. “Perhaps this is because, as I say in the preface, what I have written is less a work of social science, than the conceptual outline of one or several novels.” Indeed, the preface suggests that there is much more of Hirschman’s personal philosophy and life story stirred into the prose. It threatened to become a bildungsroman “with, as always in novels, a number of autobiographical touches mixed in here and there.”
If there were autobiographical touches, they were not so easy to see. Certainly, no reviewer picked them out, though many did pick on the book as a disappointing one. Compared to earlier books this one was a flop. Nowadays, it is often overshadowed. But one might read Shifting Involvements as a resistance against ideas of triumphalism of any one side and defeatism of any other. To both he insisted there was always more choice, there were always more possibilities, always hope.
More at the Institute for Advanced Study website here.

Wednesday, January 11, 2012

land of promise: an economic history of the united states, by michael lind

That's his newest book, due out in April, 2012. Lind asserts that contemporary debates over American economic policy have their roots in early 19th century debates over how internal improvements and manufactures should be promoted by the government. In one camp you had the more conservative view (advanced by people like Hamilton) that states should be heavily involved in the promotion of industry, and on the other, you had the "radical democratic" idea that the state should simply focus on providing a stable framework in which entrepreneurs could seek out private gain.

It might surprise some to find out that the radical libertarian philosophy did not experience a clear win in this debate. Consistently since its founding, the American state has been heavily involved in the promotion -- and even subsidization -- of American growth. Lind's work may be a way to revive these ideas again at a time in which the Keynesian notion of "Aggregate Demand Management" seems to define the limits of state interventionism -- in order to show how strikingly conservative this version of the "Keynesian" view actually is.

Here is the book's description from Amazon:
A sweeping and original work of economic history by Michael Lind, one of America’s leading intellectuals, Land of Promise recounts the epic story of America’s rise to become the world’s dominant economy. As ideological free marketers continue to square off against Keynesians in Congress and the press, economic policy remains at the center of political debate. Land of Promise offers a much-needed historical framework that sheds new light on our past—wisdom that offers lessons essential to our future. Building upon the strength and lucidity of his New York Times Notable Books The Next American Nation and Hamilton’s Republic, Lind delivers a necessary and revelatory examination of the roots of American prosperity—insight that will prove invaluable to anyone interested in exploring how we can move forward.

Monday, January 9, 2012

economic history link roundup, 1/9/12

A cartoon, yes, but still -- too simplistic?
Remembering Katrina Honeymoon, late historian of women and children's labor in Industrial England. "'It remains an inconvenient truth,' she observed in 2010, 'that most working-class children (and therefore most children) in 18th- and 19th-century Britain did not enjoy the freedom to develop physically and mentally through play and education.'"

Healthcare? Technology? Infrastructure? The Japanese economy has far from stagnated over the last 20 years. "The Myth of Japan's Failure", an NYT opinion piece, fills us in on the details.

The "Lawyers, Guns, and Money" blog continue their excellent "this day in labor history" series with a look at the passing of NAFTA. They also recently won a blogging award for this series.

great essay on Southern politics during the Cold War (from the "Lenin's Tomb" blog): "racial populism could become a recurring form of Southern politics thanks in part to the defeat and co-optation of turn-of-the-[20th ]century Southern multiracial populism."

Historicizing American Conservatism. "Alan Brinkley raises the question of how to think about the attraction of conservatism to people who are, as he puts it, perched precariously in the middle class. The recent rise of economic inequality, he suggests, may actually have led to the embrace of an antigovernment, antitax politics by middle-class and working-class people, who, facing stagnation of their incomes and living standards, have grown frustrated with a state that seems increasingly incapable of aiding them. The erosion of government...has not led to a call for more government, but rather to a sense of the impotence of the state and a deep pessimism about the possibilities of government activism, and a feeling of resentment about rising tax burdens that yield few tangible benefits (pp. 772-773)".

Saturday, January 7, 2012

law, labor, and capitalism syllabus

American shoemakers in the late-18th century.
Image source:
Here is a link to the "Law, Labor, and Capitalism in U.S. History" course which I plan to teach this semester.

I steered the course at various points more towards social and political history than what might be seen as standard for a legal studies course. I did this for two reasons.

  • The course is directed at juniors and I had trouble finding "digestible" material on labor law history for students who do not have a strong background in legal concepts. 
  • A study of social protests and political consciousness of labor can give a valuable perspective into the particular issues workers had with the law as well as how they sought to amend their position. Sometimes, legal history gets wrapped up in the evolution of rules and norms that have little to no impact on how social conflict is instigated or resolved through the law. My course represents an attempt to bring law and labor closer to each other.

Here is a good resource for constructing a legal history syllabus.

Thursday, January 5, 2012

economic history link roundup, 1/5/12, and a small request

Pacific Northwest Labor and Civil Rights Projects,
Art of Richard Correll retrieved from
Check out this excellent labor history resource, "STRIKES! Labor History Encyclopedia for the Pacific Northwest" -- yearbooks, communist party histories, and a great media selection.

Emma Rothschild: 5 books recommended on economic history.

Not something you get to learn about everyday: has a review (by Thomas Cox) up of James R. Fichter's So Great a Proffit: How the East Indies Trade Transformed Anglo-American Capitalism. Cambridge: Harvard University Press, 2010. Fichter traces trade throughout the colonial and early Republic period of American history -- its influence on elites, specifically merchants. The magnitude of the impact of this trade on the American experience is questioned by Cox, but overall it definitely seems worth checking out.

Matias Vernengo's Economic History syllabus. You can find (introductory, advanced U.S., advanced European) economic history syllabi at UMass here. (You can find my syllabus for an upper-level undergraduate class in U.S. economic history at the "Teaching" link on the upper-right side of this blog.) If you're a heterodox economist with some syllabi in economic history courses, please let me know of them and I will update the list accordingly.

Tuesday, January 3, 2012

economic history job market candidates, 2011-2012

Part of a continuing series

Nicolas Ziebarth is getting his PhD from Northwestern and lists economic history as a primary field, which is interesting in and of itself -- usually economic historians try to sell themselves in a more actively-demanded area of specialization (labor economics or development, for example) and list economic history as a secondary field just to keep job prospects as open as possible.

He is interested in the role that resource misallocation plays in economic development. (Anyone out there in development familiar with this idea and can give a quick summary? Leave a comment!) His job market paper looks at its effects during the Great Depression. "Misallocation and Productivity During the Great Depression":
Abstract: Aggregate productivity fell by 18% between 1929 and 1933. Existing explanations for this decline have focused on unobserved shifts in factor inputs such as labor hoarding. I develop a new hypothesis that focuses on the role of resource misallocation between heterogeneous plants. Using a novel plant-level dataset, I study two industries: manufactured ice and cement. I decompose the overall change in industry-level productivity into effcient productivity shifts and misallocation as in Hsieh and Klenow (2009). Increases in misallocation between 1929 and 1931 can explain at a minimum 50% of the decline in productivity for cement, around 20% between 1931 and 1933, and 10 to 15% for 1933 to 1935. I estimate that increases in misallocation can explain 50% of the total decline in industry productivity for manufactured ice between 1929 and 1935. In order to explain these findings, I develop a model of financial frictions that relates misallocation to dispersion in working capital interest rates. If banks are unwilling to take on additional leverage to fund the most productive plants, credit becomes misallocated resulting in factor misallocation and lower aggregate productivity. My model therefore explains the empirically observed increase in misallocation through an increase in the marginal cost of leverage. I argue that these empirical and theoretical results provide another role for the non- monetary effects of the banking crisis during the Depression (Bernanke, 1983a): the collapse of aggregate productivity.
At the website I linked to he also has a paper which seems like more of a "big picture" project; the kind of economic history I find more interesting. He examines traditional models of "backwardness" of developing countries in "Are China and India Backward? Evidence from the 19th Century U.S. Census of Manufactures". The abstract:
Hsieh and Klenow (2009) argue that a large fraction of aggregate TFP differences between the U.S. and the developing countries of China and India can be explained by factor misallocation. Their interpretation is that this misallocation is due to institutions and policies in these developing countries that redirect resources from productive to unproductive firms. Using the U.S. Census of Manufactures from the late 19th century, I find that the level of dispersion in these modern, less developed countries is very similar to that in the 19th century U.S. What these countries share are not similar institutions but rather similar levels of economic development. The institutions of the U.S. at this time were much better than India or China in terms of protecting property rights and allocating resources to the most productive firms. This suggests that the Hsieh-Klenow measure of imperfections is not solely related to institutions but also the level of development. I apply their accounting procedure to the U.S. and find that between 4% and 7% of manufacturing TFP growth in the 20th century can be attributed to a more efficient intra-industry allocation of resources.
The fact that neither in terms of economic development nor institutions are the U.S. and China/India similar, and the fact that the international context is quite different, makes me question the comparison, but it's still an interesting question. And he tries to frame his work in the context of the latest theoretical work by Acemoglu (which goes to the source of how precisely institutions do impact growth, instead of just saying that they matter), though he is really building off of earlier work by Hsieah and Klenow and going in a somewhat different direction -- with implications for the institutional and economic perspective. 

Sunday, January 1, 2012

economic history link roundup

A new SSRN paper (by Roger Middleton) on the history of the British Historical Statistics Project, to commemorate its new online edition.

Lawyers, Guns and Money blog runs the latest installment in their "This Day in Labor History" series with a look at an early 20th century example of labor radicalism (they did a short history of the Knights of Labor a few days ago which was really good, too).

Remembering David Montgomery, renowned labor activist and U.S. labor historian.

A new book out of Florida University Press by Mary E. Frederickson entitled Looking South: Race, Gender, and the Transformation of Labor from Reconstruction to Globalization has some essays on the case of the U.S. after the Civil War that are definitely worth a look. Abstracts for all chapters included at the link.

Book forum sums up the latest discussions of American declinism; you can find my thoughts on this latest trend, with a comparison to how British decline was analyzed, here.

Happy New Year!