Credit supply shocks and the Great Depression in Germany
Max Breitenlechner and others
Pages 1–37
https://doi.org/10.1093/erehj/heaa023
At the peak of the Great Depression in mid-1931, Germany experienced a severe banking crisis. We study to what extent credit constraints contributed to the downturn by fitting a structural vector autoregressive model with data from January 1925 to September 1935. Adverse credit supply shocks contributed strongly to the downturn especially at the time of the 1931 banking crisis. Before that, credit supply shocks had also contributed to the expansion phase preceding the depression. We also find that aggregate demand and U.S. business cycle shocks were the primary drivers of the German Great Depression.
Quantifying the mortality impact of the 1935 old-age assistance
Gregori Galofré-Vilà and others
Pages 62–77
https://doi.org/10.1093/ereh/heab001
In 1935, the United States introduced the old-age assistance (OAA) program, a means-tested program to help the elderly poor. The OAA improved retirement conditions and aimed to enable older persons to live independently. We use the transition from early elderly plans to OAA and the large differences in payments and eligibility across states to show that OAA reduced mortality by between 30 and 39 percent among those older than 65 years. This finding, based on an event study design, is robust to a range of specifications, a range of fixed effects, placebo tests, and a border-pair policy discontinuity design using county-level data. The largest mortality reductions came from drops in communicable and infectious diseases, such as influenza and nephritis, and mostly affected white citizens.
Structural change in the job matching process in the United States, 1923–1932
Woong Lee and Yeo Joon Yoon
Pages 107–123
https://doi.org/10.1093/ereh/heab004
This paper explores the structural change in the job matching process in the United States from 1923 to 1932. Bai–Perron test is employed with data from public employment offices. The result shows that there are two structural changes, July 1928 and August 1930. The first breakpoint corresponds to approximately a year before the stock market crash, implying that there was a sign of downturn in the labor market when the economy was still in a period of expansion. The second break point is related to the Great Contraction when the entire economy was going in a downward spiral.
Living costs and welfare ratios in Western Europe: new estimates using a linear programming model
Luis Felipe Zegarra
Pages 38–61
https://doi.org/10.1093/ereh/heab007
This study provides new estimates on welfare ratios for London, Amsterdam, Paris, Strasbourg, Munich, and Leipzig for 1600–1850. I use a linear programming model to compute the basket that minimizes the food cost subject to nutrient requirements. For a balanced nutrition, I take into consideration that people should ingest not only calories and proteins, but also fat, iron, and some basic vitamins. The results suggest that living standards in Western Europe were lower than previously thought. However, like previous studies, this article suggests that welfare ratios in London were higher than in other European cities.
Cartelization and firm performance in Upper Silesia 1880–1913
Christian Beyer
Pages 124–153
https://doi.org/10.1093/ereh/heab006
In this article the effects of cartelization on firms’ efficiency are investigated using the example of an early twentieth century coal-mining cartel in Upper Silesia: the Upper Silesian Coal Convention. Established in 1898, the cartel comprised various types of private, as well as state-owned, mining enterprises. Using a microeconomic dataset based on firm-level data of the Upper Silesian mines, I focus on the cartel’s effect on efficiency. The cartel did not significantly reduce technical efficiency among mines. This finding confirms previous research on cartels’ effects on efficiency.
Pandemics and regional economic growth: evidence from the Great Influenza in Italy
Mario F Carillo and Tullio Jappelli
Pages 78–106
https://doi.org/10.1093/erehj/heab009
We investigate the link between the 1918 Great Influenza and regional economic growth in Italy, a country in which the measures implemented by public authorities to contain the contagion were limited or ineffective. The pandemic caused 600,000 deaths in Italy: 1.2% of the population. Going from regions with the lowest mortality to those with the highest mortality is associated to a decline in per capita GDP growth of 6.5%, which dissipated within 3 years. Our estimates provide an upper bound of the adverse effect of pandemics on regional economic growth in the absence of non-pharmaceutical public-health interventions.
