Risk, Government and Globalization: International Survey Evidence

This paper uses international survey data to document two stylized facts. First, risk aversion is associated with anti-trade attitudes. Second, this effect is smaller in countries with greater levels of government expenditure. The paper thus provides evidence for the microeconomic underpinnings of the argument associated with Ruggie (1982), Rodrik (1998) and others that government spending can bolster support for globalization by reducing the risk associated with it in the minds of voters.Trade attitudes, risk

The Determinants of Individual Attitudes Towards Immigration

We are grateful to Kevin Denny and Chris Minns for helpful suggestions. O’Rourke is a

Globalization, Growth and Distribution in Spain 1500-1913

The endogenous growth literature has explored the transition from a Malthusian world where real wages, living standards and labor productivity are all linked to factor endowments, to one where (endogenous) productivity change embedded in modern industrial growth breaks that link. Recently, economic historians have presented evidence from England showing that the dramatic reversal in distributional trends – from a steep secular fall in wage-land rent ratios before 1800 to a steep secular rise thereafter – must be explained both by industrial revolutionary growth forces and by global forces that opened up the English economy to international trade. This paper explores whether and how the relationship was different for Spain, a country which had relatively poor productivity growth in agriculture and low living standards prior to 1800, was a late-comer to industrialization afterwards, and adopted very restrictive policies towards imports for much of the 19th century. The failure of Spanish wage-rental ratios to undergo a sustained rise after 1840 can be attributed to the delayed fall in relative agricultural prices (due to those protective policies) and to the decline in Spanish manufacturing productivity after 1898.Growth, distribution, globalization, Spain

Trade, Technology and the Great Divergence

This paper develops a model that captures the key features of the Industrial Revolution and the Great Divergence between the industrializing \North" and the lagging \South." In particular, a convincing story is needed for why North-South divergence occurred so dramatically during the late 19th Century, a good hundred years after the beginnings of the Industrial Revolution. To this end we construct a trade/growth model that includes both endogenous biased technologies and intercontinental trade. The Industrial Revolution began as a sequence of unskilled-labor intensive innovations which initially incited fertil- ity increases and limited human capital formation in both the North and the South. The subsequent co-evolution of trade and technological growth however fostered an inevitable di- vergence in living standards - the South increasingly specialized in production that worsened their terms of trade and spurred even greater fertility increases and educational declines. Biased technological changes in both regions only reinforced this pattern. The model high- lights how pronounced divergence ultimately arose from interactions between specialization from trade and technological forces.

Trade and Empire, 1700-1870

This paper surveys the rise and fall of the European mercantilist system, and the transition to the modern, well-integrated international economy of the 19th century. It also surveys the literature on the links between trade and economic growth during the period, and on the economic effects of empire.trade, empire, history

When did globalization begin?

Some world historians attach globalization “big bang” significance to 1492 (Christopher Colombus stumbles on the Americas in search of spices) and 1498 (Vasco da Gama makes an end run around Africa and snatches monopoly rents away from the Arab and Venetian spice traders). Such scholars are on the side of Adam Smith who believed that these were the two most important events in recorded history. Other world historians insist that globalization stretches back even earlier. There is a third view which argues that the world economy was fragmented and completely deglobalized before the 19th century. None of these three competing views has explicitly shown the difference between trade expansion driven by booming demand and supply within the trading economies (e.g., the underlying fundamental, population growth), and trade expansion driven by the integration of markets between trading economies (e.g., the central manifestation of globalization, commodity price convergence). This paper makes that distinction, and then offers two novel empirical tests which allow us to discriminate between these three competing views. Both tests show: there is no evidence supporting the view that the world economy was globally integrated prior to 1492 and/or 1498; there is also no evidence supporting the view that these two dates had the economic impact on the global economy that world historians assign to them; but there is abundant evidence supporting the view that the 19th century contained a very big globalization bang. These tests involve a close look at the connections between factor prices, commodity prices and endowments world wide