Joerg Baten University of Tuebingen

Joerg Baten will soon be named Professor of Economic History at the University of Tuebingen and participates in the CESifo research network. He studied economic history and computer science at Freiburg University, receiving his M.A. in 1991. He completed his doctorate in economics 1997 at the University of Munich. His thesis, completed under the direction of John Komlos, was on nutrition and economic development in Bavaria 1730-1880. Being appointed four years later as a full professor, he will be by far the youngest economic history professor in Germany. His main research fields are (a) the study of living standards, health, longevity, nutrition and anthropometric history, and (b) the economic history of firm creation, survival and productivity in Germany, but he has other research interests as well, such as economic determinants of aggression and nationalism.

Baten's current research focuses on living standards and the use anthropometric and demographic indicators to address important issues that could not be answered before the development of these indicators. Examples of this strategy are his studies of the secular trend in welfare in totalitarian economies of the 20th century, the assessment of inequality trends in societies with a significant share of self-employed in under-developed markets (which makes neoclassical assumptions sometimes problematic), the influence of climate on economic development in the 18th and 19th centuries, the impact of protein production and transport technology on health and economic development, and the gender-specific development of living standards.

In his most recent project in the anthropometric field, Baten and Wagner study [1] the health and mortality crisis in Nazi Germany before the outbreak of war. As it turns out, Germany experienced an all-but-unknown, yet substantial, increase in mortality rates in almost every age group in the mid-1930s. This is the case even in comparison to 1932, the worst year of the world economic crisis. Moreover, children's heights ­ an indicator for quality of nutrition and health - were generally stagnating between 1933 and 1938, while heights had increased significantly during the 1920s. The crisis of biological well being was too substantial and wide-spread to be explained by persecution alone; rather, its effect was broad based. This adverse development was caused by the fact that government expenditures on rearmament increased at the expense of public health measures. In addition, food imports were curtailed and prices of many agricultural products were controlled. There is ample evidence to indicate that the government's autarchy policy had an adverse effect on the health and nutritional status of the population. Baten and Wagner find that the most developed regions with a large service and urban sectors suffered most from the policy of restricting imports of protein-rich agricultural products.

The economic history of inequality is crucial for understanding today's trends in differential returns to various types of economic activity. In order to study long-run trends Baten [2] explored the use of anthropometric measures (e.g., coefficient of variation of height, height differentials) to assess inequality trends and cross-sectional patterns of biological well-being. The study demonstrates that under certain conditions heights are reliable indicators of inequality. Baten demonstrates that Kuznet's inverse U of inequality in biological well-being held in 19th century Bavaria, as income inequality was on the rise in the early-19th century, especially as land rents and the returns to specialized skills were increasing; whereas the purchasing power of unskilled labor was falling.

The influence of climatic factors is crucial for understanding the development of agriculture until the late 19th centuries. In [3] Baten argues that there was a causal chain leading from colder winters to lower grain and protein production, and these factors determined real wages as well as human physical stature, only slightly modified in central Europe by the introduction of the potato. This result holds for different regions in Germany, and for Austria-Hungary. The development of real wages and nutritional status in England and Scotland can be explained to a considerable degree if the climatic patterns in the Baltic are taken into consideration, as it was a main source of Britain's grain imports.

These arguments are tested and confirmed for the Swedish case in [4]. This work evolved out of an interdisciplinary cooperation with climatologists, biologists, and scholars from other fields associated with the new Hanse Science Centre near Bremen. This line of research addresses a large market in the natural sciences as well as the more traditional audience of economic historians.

Baten's dissertation received the prize of the Alumni Club in 1998. Topics discussed in his thesis include the nutritional benefits of self-sufficiency, and of the isolation from distant markets for poor agricultural laborers in 18th and 19th century Bavaria [5]. In "milk regions" that were regarded as economically under-developed by contemporaries, the population enjoyed higher nutritional quality and enjoyed longer lifes after infancy. He also documents and analyses the importance of nutritional status for economic development, especially in periods of globalization, with human-capital intensive growth. Apart from New World populations, the Scandinavians and the Irish suffered least from protein malnutrition, whereas the Mediterranean and Eastern European countries tended to have low protein consumption. As protein malnutrition limits human capital formation and hence productivity growth, the intense controversy over the pattern of convergence or divergence of growth rates across economies can be illuminated by using nutritional status as an additional variable.

The development of gender-specific living standards is a particularly fascinating topic, partly because modern studies find that discrimination vis-a-vis females has a retarding effect on GDP growth. While it is difficult to measure relative well-being of female non-wage earners with conventional methods, anthropometric measures open important new avenues of research. Baten and Murray find on the basis of a 19th century Bavarian prison records [6] that women's heights were significantly reduced by the 1840's potato crisis, by the incidence of tuberculosis, and by illegitimate birth, none of which affected men's heights significantly.

This question of gender discrimination within the household was particularly decisive for those born out of wedlock. Baten and Murray [7] contributed to resolving a debate between W.R. Lee and Edward Shorter. Baten and Murray argue that discrimination against those who were born out of wedlock was extreme during the initial stages of economic development, but became less severe during the second half of the 19th century. Another paper pertaining to females include witch hunting in the 17th century [13] in which Baten and Woitek show that there was a correlation between persecution and grain prices.

Baten also addresses some questions of anthropometric methodology. He finds, for example, that the influence of food intake and relative prices that prevailed during the first year of life has by far the strongest influence on final adult stature[6]. In contrast, the height of children and youth prior to reaching final height (in malnourished populations up to the age of 23) is most significantly influenced by the nutritional circumstances prevailing during years immediately prior to measurement. He also discusses the complex relationship between heights and real wages in several European countries [8].

Another methodological issue is the relationship among the components of what is now conceptualized as biological standard of living: health, longevity, and nutrition. Baten and Komlos estimated in a review essay [9] the relationship between height and life expectancy for a sample of countries in 1860, 1900, and 1950. They find that a one centimeter diminution in adult height meant a 1.8 years loss in life expectancy in 1860 and 1900, and a 1.2 years loss in 1950. Japan seems to have been an exception in the early period. Komlos and Baten also edited an anthology [10] with papers on China, Argentina, Australia and many others.

The second major project in Baten's research program pertains to the economic history of firms. He collected and analyzed tax records on almost 20,000 German firms in the "Era of Globalisation" (1880-1913), supported by the Fritz Thyssen foundation. In a study on regional determinants of firm creation in Southwest Germany [11], Baten finds that a positive externality is created by the specific human capital that potential firm creators acquire in small and medium sized firms in which they typically work before setting up their own business. This factor turns out to be very influential, even when controlling for autoregressive effects. Another hypothesis considered is derived from KrugmanÕs assertion that in periods of rapidly declining transport costs agglomeration effects reinforce industrial activity by positive externalities. Agglomeration effects in firm creation were much more important around 1900 than they are today, and they can be divided into human capital externalities and other agglomeration externalities.

In contrast to contemporary evidence, Baten argues that historical data sets on entrepreneurial behavior have advantages for answering many important questions, as tax and business secrets do not hinder data acquisition and do not create selectivity problems. In addition, lower levels of government intervention (for example, in regional economic policy) allow a better econometric identification of economic behavior.

In his second forthcoming monograph [12], Baten extends the firm creation research to all of Germany and focuses in subsequent chapters on the survival, growth, and productivity of small and large firms. One important result is that for most pre-1913 industries Baten rejects the hypothesis of economies of scale beyond a firm size of 10-30 workers. Both total factor productivity and labor productivity were higher in this size segment compared with both larger and smaller firms. This result holds for South Germany as well as the heavy industrial West. Very few industries were exceptions to this rule, and human-capital-intensive machine building was clearly not one them. Small and medium sized firms in this competitive industry (cartels were few and short-lived) contributed heavily to GermanyÕs industrial and export success during this era of globalization. New evidence suggest that it was competition, not cartel and protectionism, that led to economic success and catch-up with New World productivity leadership before 1914 (in a country of relatively favorable nutritional status). This is a historical fact that seems to have been all but forgotten in the subsequent epochs.

Baten's future projects include continued research on the productivity of firms, especially under wartime conditions and governmental price controls during WWI, and on the productivity of firms in the service sector. Furthermore, economic determinants of aggression and nationalism will be studied in a project on the WWI and post-war period in Poland, Czechoslovakia, Hungary and Eastern Germany.

Baten was also one of the co-organizers of the First German Cliometric Conference in Toronto in 1999 [http://www.chass.utoronto.ca/~germclio/ ]. The next conference he is co-organizing is the First International Conference on Economics and Human Biology. ]http://www.vwl.uni-muenchen.de/ls_komlos/tuebingen/index.html]. In sum, Baten is one of the most ardent supporters of cliometric research in Germany. With him the cliometric research program has found firm footing among the younger generation of German scholars.

References

The full list of publications is available under www.uni-tuebingen.de/uni/wwl/F1.htm, many of them can be accessed and downloaded.

[1] Health under National Socialism: the Mortality and Nutritional Crisis in Germany 1933-38, with Andrea Wagner, Working Paper Tuebingen/Munich 2001.

[2] "Economic Development and the Distribution of Nutritional Resources in Bavaria, 1797-1839," in Journal of Income Distribution 9 (2000), pp. 89-106.

[3] "Climate, Grain Production and Nutritional Status in 18th Century Southern Germany" in Journal of European Economic History 2001, pp. 9-47 (forthcoming).

[4] "Human Stature and Climate: The Impact of Past Climate on Living Standards" in Behre, Karl Ernst et al., Past Climate and its Significance for Human History, the Last 10,000 Years. New York et al: Springer, 2001 (forthcoming).

[5] Ernährung und wirtschaftliche Entwicklung in Bayern, 1730-1880. Stuttgart: Steiner (1999). [Nutrition and Economic Development in Bavaria, 1730-1880, English translation in progress.]

[6] "Heights of Men and Women in Nineteenth Century Bavaria: Economic, Nutritional, and Disease Influences," with John Murray, in Explorations in Economic History 37 (2000), pp. 351-369.

[7] "Bastardy in Southern Germany Revisited: An Anthropometric Synthesis", mit John Murray, Journal of Interdisciplinary History 28-1 (1997), S. 47-56.

[8] "Height and Real Wages: An International Comparison," in Jahrbuch fuer Wirtschaftsgeschichte 2000-1, pp. 17-32.

[9] "Height and the Standard of Living", with John Komlos, Journal of Economic History 57, Nr. 3 (1998), S. 866-870.

[10] The Biological Standard of Living in Comparative Perspective, with John Komlos (eds.). Stuttgart 1998.

[11] "New Firms for a New Century: Firm Creation and Regional Economic Structure around 1900," Working Paper Tuebingen 2001.

[12] The Creation, Productivity, and Success of Firms in Germany, 1880-1914 (book-length manuscript, publication in preparation)

[13] Grain Price Fluctuations and Witch Hunting in Bavaria, with Ulrich Woitek, Working Paper Munich/Glasgow 2000.