British Relative Economic Decline Revisited

This paper examines the role of competition in productivity performance in Britain over the period from the late-nineteenth to the early twenty-first century. A detailed review of the evidence suggests that the weakness of competition from the 1930s to the 1970s undermined productivity growth but since the 1970s stronger competition has been a key ingredient in ending relative economic decline. The productivity implications of the retreat from competition resulted in large part from interactions with idiosyncratic British institutional structures in terms of corporate governance and industrial relations. This account extends familiar insights from cliometrics both analytically and chronologically.competition; productivity; relative economic decline

East Asian Growth Before and After the Crisis

The paper surveys the literature on the growth performance of the East Asian economies, evaluates the sustainability of that performance, and provides a preliminary assessment of their long-term growth prospects in the aftermath of the current crisis. It highlights special features of East Asian growth, including unusually high factor accumulation and a favorable demographic transition, but argues that total factor productivity growth has generally been somewhat disappointing. It argues that there are downside risks to the East Asian "developmental state" model, and that it may become less attractive as these economies mature. Copyright 1999, International Monetary Fund

The Marshall Plan: A Reality Check

This paper surveys the literature on the Marshall Plan which was designed to help the reconstruction of Europe after World War II. A basic description of how the Marshall Plan was implemented is provided but the focal point is a consideration of the impact of American aid on European growth. It is concluded that the direct effects were positive but modest. The indirect effects working through induced policy changes may have been larger. If so, the Marshall Plan may be thought of as a successful structural adjustment program of the kind advocated by believers in the Washington Consensus.Aid; Economic Growth; Marshall Plan; Structural Adjustment Program

Economic History Matters

This paper considers the future of economic history in the context of its relationship with economics. It is argued that there are strong synergies between the two disciplines and that awareness of the economic past is an important resource for today’s economists. Examples are given that illustrate these points. It is clear that the past has useful economics but the potential value of economic history to economics will only be realized if economic historians are fluent in economics and organize the presentation of their research findings with a view to addressing questions that matter from a policy perspective.analytic narratives; economic growth; institutions; technological change

The Celtic Tiger In Historical And International Perspective

When Economic Development was published in 1958, Ireland was a growth failure but thirty years later it became the Celtic Tiger. This paper places this remarkable development in the context of long-run economic growth in Western Europe and establishes the distinctive features of Irish experience and policy. This enables an assessment of the diagnosis and policy proposals that Whitaker provided fifty years ago. The central roles in the Celtic Tiger of foreign direct investment, ICT production, and an elastic labour supply are highlighted while the importance of globalization and the abandonment of misguided autarchic policies is made clear.

Explaining the First Industrial Revolution: Two Views

This review essay looks at the recent books on the British Industrial Revolution by Robert Allen and Joel Mokyr. Both writers seek to explain Britain’s primacy. This paper offers a critical but sympathetic account of the main arguments of the two authors considering both the economic logic and the empirical validity of their rival claims. In each case, the ideas are promising but the evidence base seems in need of further support. It may be that eventually these explanations for British economic leadership at the turn of the nineteenth century are recognized as complementary rather than competing.

Productivity growth in the Industrial Revolution: a new growth accounting perspective

The issue of why productivity growth during the British industrial revolution was slow despite the arrival of famous inventions is revisited using a growth accounting methodology based on an endogenous innovation model and the perspective of recent literature on general purpose technologies. The results show that steam had a relatively small and long-delayed impact on productivity growth when benchmarked against later technologies such as electricity or ICT. Even so, technological change including embodiment effects accounted entirely for the acceleration in labor productivity growth that allowed the economy to withstand rapid population growth without a decline in living standards.

The Contribution of New Technology to Economic Growth: Lessons from Economic History

This paper reviews the analysis of technological change by cliometricians. It focuses on lessons about total factor productivity (TFP) from growth accounting and on aspects of social capability that are conducive to the effective assimilation of new technology. Key messages are that when TFP growth is very rapid this typically involves reductions in inefficiency not just technological advance and that even really important new technologies have small initial effects on aggregate productivity. Incentive structures matter greatly for the adoption of new technology but social capability is not independent of the technological epoch as the ICT era has emphasized to Europeans.economic growth; growth accounting; social capability; technological change

Geography and Intra-National Home Bias: U.S. Domestic Trade in 1949 and 2007

This article examines home bias in U.S. domestic trade in 1949 and 2007. We use a unique data set of 1949 carload waybill statistics produced by the Interstate Commerce Commission, and 2007 Commodity Flow Survey data. The results show that home bias was considerably smaller in 1949 than in 2007 and that home bias in 1949 was even negative for several commodities. We argue that the difference between the geographical distribution of the manufacturing activities in 1949 and that of 2007 is an important factor explaining the differences in the magnitudes of home-bias estimates in those years