The Great Kanto Earthquake occurred on 1 September 1923 and inflicted serious damage on Yokohama City. About 90 percent of the factories in Yokohama City were burnt down or completely destroyed. However, these manufacturing industries appear to have swiftly recovered in the aftermath of the damage. This article investigates the role of creative destruction due to the Great Kanto Earthquake. Using firm-level data on capital (horsepower of motors) before and after the earthquake, we find substantial creative destruction, that is, upgrade of machine technology and/or survival of efficient firms. We find further collaborating evidence of this at the prefecture level.

This paper illuminates one particular aspect of the theme of this session, property rights in man. It will deal with various emancipation plans: those actually enacted in various slave societies; those discussed by legislators who debated slave and antislave proposals; and those which, being purely fictional, have become part of counterfactual history.

In his recently published volume on American economic history, Chester W. Wright says, in substance, that whereas he can give some account of the vicissitudes experienced by the several distributive factors of land, labor, and capital, he will have to deal in a very cursory fashion with the entrepreneur and with entrepreneurial gains since so little is known about them. I, for one, welcomed this statement of so eminent a student of American economic history since it gave such forthright support to ideas which I was at the time presenting to the recently organized Committee on Research in Economic History (ideas by no means wholly or even chiefly my own) relative to the desirability of research in the history of American entrepreneurship.

Wealth and asset holding in late-nineteenth-century Ontario are examined using a new data set of census-linked probated decedents. Hump-shaped wealth-age profiles are found, supporting the importance of demographic and life cycle forces in late-nineteenth-century financial asset accumulation. With financial asset holding more pronounced in Ontario than Quebec, the implication for Canadian economic development is that the differences in capital formation and industrialization across Ontario and Quebec are partly rooted in saving behavior. The results show that urbanization, occupational status, literacy, the number of children, and region of residence are important determinants of wealth and asset holding.

We estimate the monthly and hourly earnings ratio between agricultural and manufacturing laborers, adjusting for compensation received in-kind and differences in the cost of living. Our results indicate that prior to the Great Depression, agricultural compensation was similar to that in manufacturing within geographic regions, and a substantial earnings gap in favor of manufacturing emerged in the early thirties.

Research on nineteenth-century economic and social mobility has concentrated on occupational change among men who remained in the same community for ten or more years, although fewer than half of any community's residents persist that long. This article uses a data set created specifically to compare the experiences of men who migrated from Newburyport, Massachusetts in the mid-nineteenth century with those of men who persisted. It finds that blue-collar migrants were more successful than were their counterparts who did not move. The results suggest that previous studies may have considerably underestimated the extent of economic opportunity in nineteenth-century America.

Managerial firms and cartels were central components of the German economy during the late nineteenth and early twentieth century. Based on stochastic frontier regressions, we show for a sample of coal mining corporations and the period 1881–1913 that cartelization did not affect productive efficiency. Bonuses paid to board members, however, did increase the efficiency of coal mining firms. Thus, one pillar of the German economic model did not negatively affect economic efficiency, whereas another pillar had a positive impact. Furthermore, our results suggest that coal was mined with slightly decreasing returns to scale.

British shipbuilding enjoyed undisputed international supremacy between 1890 and 1914. Following a gradual loss of world market share during the interwar years, Britain sustained an absolute decline in output between 1948 and 1970. European shipbuilding expanded at an unprecedented rate after World War II. This article attributes Britain's dramatic competitive decline in part to management's uncertaintly about the need to reform work administration methods during the decade or so following world War II, and in part to lack of trust between labor and management, which resulted in a failure of cooperation over proposed institutional reform between 1958 and 1965.

Over the 1919–1929 period, fluctuations in the value of stock trading on the New York Stock Exchange exercised statistically significant and economically important impacts on the demand to hold cash balances. The marked post–1925 rise in the volume and value of stock trading led to a measurable increase in the transactions demand to hold cash balances, an increase in demand not recognized or seriously discussed by individuals inside or outside of the system. Had it been recognized, it is unlikely that the Fed would have persisted in its antispeculative policies in 1928–1929, policies associated with rises in interest rates and the beginnings of a downturn in real activity in the second quarter of 1929.

Mexico's initial industrialization was based on firms that were “grouped”: that is, linked to other firms through close affiliations with a common bank. Most explanations for the prevalence of groups are based on increasing returns or missing formal capital markets. We propose a simpler explanation that better fits the facts of Mexican history. In the absence of secure property rights, tangible collateral could not credibly be offered to creditors; but there remained the possibility of using reputation as a form of intangible collateral. In such circumstances, firms had incentives to group together for purposes of mutual monitoring and insurance.

Between 1933 and 1936 the Home Owners’ Loan Corporation purchased more than a million delinquent mortgages from private lenders and refinanced those loans for the borrowers. Its primary goal was to break the cycle of foreclosure, forced property sales and decreases in home values that was affecting local housing markets throughout the nation. We find that the volume of HOLC lending was related to measures of distress in local (county-level) housing markets and that these interventions increased 1940 median home values and homeownership rates, but not new home building.

“[A] tremendous surge of residential building in the [last] decade… was matched by an ever-increasing supply of homes sold on easy terms [and only]… a small decline in prices was necessary to wipe out this equity. Unfortunately, deflationary processes are never satisfied with small declines in values. They feed upon themselves and produce results out of all proportion to their causes… In the field of real estate finance, particularly, we have depended so much upon credit that our whole value structure can be thrown out of balance by relatively slight shocks. When such a delicate structure is once disorganized, it is a tremendous task to get it into a position where it can again function normally.”1

Henry Hoagland, 1935

The writing and allocation of French tax farm contracts changed dramatically after the Fronde (1648–1653): they were gradually transformed from small, competitively auctioned, units into a large cartel known as the Company of General Farms. Surprisingly, the crown's revenues increased. I present a transaction cost argument to explain the behavior of tax farm lease prices as tax farming changed during the seventeenth century. Cartelization of tax farms lowered costs faced by the crown. The tax farm system's evolution offers insights into how organizations evolve to protect their property rights in the absence of well functioning representative institutions.

How much of the increased consumption of machine-made cotton yarn and cloth in nineteenth- and twentieth-century China represented a net increase in the total consumption of cotton goods? What part of the increment merely denoted a shift of the source of supply from rural handicraft to factory production—in Shanghai and Tientsin and, in the form of imports, in overseas mills? These questions, of course, are only part of the more inclusive problem of the effects of expanding foreign trade and the beginnings of domestic industrialization upon the agricultural sector in modern China. The most important household handicraft in rural China was, however, the spinning and weaving of cotton. An examination of its fate, while it will not dispose entirely of the larger problem, is a critical step toward that end.

We present a new estimate of Anglo-German manufacturing productivity levels for 1935/36. It is based on archival data on German manufacturing and published British census data. We calculate comparative levels of value added, correcting for differences in prices for outputs and inputs. This so-called double deflation procedure provides new insights into productivity comparisons because output- and input price structures differed greatly between the two countries. Although the new calculations confirm existing results at an aggregate level, they reveal important differences at the industry level and show how Germany was striving for autarky as it prepared its economy for war.

This article presents the first agricultural production function for the eighteenth century, thereby quantifying the effect of many new technologies coming on stream in English agriculture. It shows that some traditional technologies were effective in raising wheat yields, such as drainage and marling; but some innovations of the eighteenth century were much more effective, particularly turnips and seed drills. Environmental factors are incorporated into the model. Climate is shown to be a crucial factor in determining yields but soil quality was much less important. This undermines the accepted argument that England's success was due to a superior natural endowment.

In 1940, when our Association was founded, this paper might have borne the same title as Caroline Ware's book: The Cultural Approach to History. In the meantime, however, world events have brought economists and historians together around the problem of economic growth. So, while pursuing the same interests illustrated in my contribution to Caroline Ware's book, I have chosen the more fashionable title of “Cultural Factors in Economic Growth.”

How—and how well—do food markets function in famine conditions? The controversy surrounding this question may benefit from historical perspective. Here we study two massive famines that struck France between 1693 and 1710, killing over two million people. In both cases the impact of harvest failure was exacerbated by wartime demands on the food supply; we ask whether the crises were exacerbated yet further by a failure of markets to function as they did in normal times. The evidence, we conclude, is most consistent with the view that markets in fact helped alleviate these crises, albeit modestly.

Aujourd'hui ces matières paraissent d'une telle aridité qu'elles provoquent le vide, même au sein du parlement, si par hasard on les y discute…On ne voit plus des écarts de prix comparables à ceux des grandes années de famine de la fin du règne de Louis XIV: 1693 et 1709.Germain Martin (French historian) in 1908[Today these issues seem so stupifyingly dull that they produce an empty house, even in parliament, if by chance they are discussed there…. One no longer sees gaps in prices comparable to those of the years of famine at the end of the reign of Louis XIV, in 1693 and 1709.] Martin, “Famines,” p. 150.

World War II temporarily halted the rise in high school and college graduation rates. This article shows that manpower mobilization for World War II decreased educational attainment among high school-age females during the early 1940s, reduced employment and earnings, and altered decisions regarding family formation. I then provide evidence that women in this cohort returned to school in later life and relate these findings to the “quiet revolution” taking place as women learned about the benefits of school and work over the second half of the twentieth century.

“Education has been ever in the nation's service. But in these days of total war that service has a new significance. ‘You're in the Army now’ is no cliché–it is an expression of national necessity.”1

We revisit Max Weber’s hypothesis on the role of Protestantism for economic development. We show that nationalism is crucial to both, the interpretation of Weber’s Protestant Ethic and empirical tests thereof. For late nineteenth-century century Prussia we reject Weber’s suggestion that Protestantism mattered due to an “ascetic compulsion to save.” Moreover, we find that income levels, savings, and literacy rates differed between Germans and Poles, not between Protestants and Catholics, using pooled OLS and IV regressions. We suggest that this result is due to anti-Polish discrimination.

This article combines a game-theoretic framework and a comparative analysis to study the impact of the Great Depression on private welfare capitalism. Recharacterizing welfare capitalism as an implicit-contract equilibrium, the article documents parallel institutional developments in the United States and Japan in the 1920s and the process of bifurcation thereafter. In the United States, the breach of contract by major employers induced by the depression led to the rise of explicit contracts and legal enforcement institutions. By contrast, the less severe depression in Japan allowed the maintenance of implicit contracts and the formation of complementary labor laws.This article is partly based on my doctoral dissertation. I am deeply indebted to my thesis advisors, Avner Greif, Gavin Wright, Masahiko Aoki, and John Pencavel. I am grateful to Lee Alston, Carliss Baldwin, Samuel Bowles, Adam Brandenburger, Loren Brandt, Amit Bubna, Louis Cain, David Fairris, Joe Ferrie, Price Fishback, Robert Gibbons, Claudia Goldin, Rakesh Kurana, Robert Margo, Jim Minifie, Joel Mokyr, Laura Owen, Ben Polak, Daniel Raff, Paul Rhode, William Tsutsui, Warren Whatley, and two anonymous referees for their valuable comments.