EH.net Book Review

Birth of a Market: The U.S. Treasury Securities Market from the Great War to the Great Depression

Author: 
Garbade, Kenneth D.
Reviewer: 
Noll, Franklin

Published by EH.Net (May 2012)

Kenneth D. Garbade, Birth of a Market: The U.S. Treasury Securities Market from the Great War to the Great Depression.  Cambridge, MA: MIT Press, 2012.  xii + 393 pp. $50 (hardcover), ISBN: 978-0-262-01637-7.

Reviewed for EH.Net by Franklin Noll, Noll Historical Consulting.

Kenneth Garbade has been doing path-breaking work for years in what I like to call the mechanics of Treasury finance.  In various case studies and articles, Garbade, Senior Vice President at the Federal Reserve Bank of New York, has charted the origins of the sometimes revolutionary developments in Treasury financing that we now take for granted, including book-entry securities and Treasury auctions.  In Birth of a Market, he applies his special insight to the changes in Treasury financing methods during the interwar period. Attention to this topic is long overdue as sixty years have passed since the last detailed examination of Treasury debt management in the mid-twentieth century.

In his book, Garbade argues that between 1917 and 1939 the Treasury undertook four initiatives that made possible the familiar post-World War II primary securities market: the revival of auction sales, the linkage of Treasury cash and debt management, the loosening of Congressional constraints on Treasury management of the debt, and the start of offering securities on a regular, consistent schedule.  These developments, in turn, were caused by the Treasury’s reaction to the new reality of a large, permanent public debt created during the period.

Geographic Area: 
North America
Subject: 
Government, Law and Regulation, Public Finance
Time period: 
20th Century: Pre WWII

Parasites, Pathogens, and Progress: Diseases and Economic Development

Author: 
McGuire, Robert A.
Coelho, Philip R. P.
Reviewer: 
Murray, John E.

Published by EH.Net (May 2012)

Robert A. McGuire and Philip R. P. Coelho, Parasites, Pathogens, and Progress: Diseases and Economic Development.  Cambridge, MA: MIT Press, 2011. viii + 343 pp. $30 (hardcover), ISBN: 978-0-262-01566-0.

Reviewed for EH.Net by John E. Murray, Department of Economics, Rhodes College.

An old saw proposes that holding a hammer makes everything look like a nail.  When Robert McGuire and Philip Coelho suggest (p. 5) that Jared Diamond’s bestseller (1997) should have been titled Germs, Germs, and Germs, the reader may think that the authors carry not a hammer but a microscope.  Everywhere in this history, germs appear as the critical and virtually only influence on economic development.  By the end the reader better understands microbes in American history, but may still wonder if natural resource endowments, property rights and contract law, accumulating human capital, and flexible markets played a role as well.

Geographic Area: 
North America
Subject: 
Economic Development, Growth, and Aggregate Productivity
Servitude and Slavery
Living Standards, Anthropometric History, Economic Anthropology
Time period: 
17th Century
18th Century
19th Century

The Poverty of Clio: Resurrecting Economic History

Author: 
Boldizzoni, Francesco
Reviewer: 
Petracca, Enrico

Published by EH.Net (May 2012)

Francesco Boldizzoni, The Poverty of Clio: Resurrecting Economic History. Princeton, NJ: Princeton University Press, 2011. xi + 216 pp. $39.50 (cloth), ISBN: 978-0-691-14400-9.

Reviewed for EH.Net by Enrico Petracca, Departments of Philosophy and Economics, University of Bologna.

In a well-known passage quoted by Carlo M. Cipolla (1991), the ancient historian Arnaldo Momigliano wrote: “The historian works on the assumption that he is capable of reconstructing and understanding the events of the past. If an epistemologist manages to convince him that this is not so, the historian should change profession.” More difficult – but to a certain extent more interesting – would be the possibility that a historian be convinced to give up his own way of doing history by another historian.

Francesco Boldizzoni (University of Turin) belongs to a younger generation of Italian scholars and his training in both history and economics makes him “familiar with the tricks of the trade” (p. x). The Poverty of Clio is meant to give voice to an increasing sense of dissatisfaction within the economic history profession. The subject, the author says, is undergoing a “deep identity crisis” (p. 4) brought about by the spread of the U.S.-born “New Economic History” – or, as it is also labeled, “cliometrics” – worldwide, and across Europe in particular.

Geographic Area: 
General, International, or Comparative
Subject: 
Development of the Economic History Discipline: Historiography; Sources and Methods
Time period: 
General or Comparative

A History of Entrepreneurship

Author: 
Hébert, Robert F.
Link, Albert N.
Reviewer: 
Diamond, Arthur M.

Published by EH.Net (April 2012)

Robert F. Hébert and Albert N. Link, A History of Entrepreneurship.  London: Routledge, 2009.  xix + 121 pp. $115 (hardcover), ISBN: 978-0-415-77738-4.

Reviewed for EH.Net by Arthur M. Diamond, Jr., Department of Economics, University of Nebraska at Omaha.

A History of Entrepreneurship is a brief survey of what several well-known, and several less-well-known, economists have had to say about the role of the entrepreneur in the economy. Hébert and Link have collaborated on the history of entrepreneurship before.  Besides some papers, their 1988 monograph is substantially the same as the current monograph and their 2006 monograph appears identical except for new versions of the very brief Preface, Introduction and Conclusion.  (If you decide the monograph is useful to you, you may want to buy the 2006 version available for download through SSRN for a mere $19.) Since this is a very slight revision of their 1988 monograph, it is not surprising that almost all of the literature cited is from the mid-1980s or earlier.  Much recent literature is ignored (e.g., Mark Blaug’s insightful 1998 paper).

Economic writings on entrepreneurship are organized, mainly by time and geography, into ten brief chapters – Schumpeter is given his own chapter.  Chapters are devoted to French economists, English economists, the neo-classicals, and American economists.  Among twentieth-century economists, besides Schumpeter, significant attention is devoted to Frank Knight, Israel Kirzner, and Ronald Coase.

The monograph does not aim to make a contribution to economic history, and none is made.  Economic historian Arthur Cole's Harvard workshop on entrepreneurship receives a couple of pages (pp. 78-79) of discussion, but almost entirely in terms of the theoretical stance of the workshop participants.

Geographic Area: 
General, International, or Comparative
Subject: 
Business History
History of Economic Thought; Methodology
Time period: 
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Financing Failure: A Century of Bailouts

Author: 
McKinley, Vern
Reviewer: 
Smith, Roy C.

Published by EH.Net (April 2012)

Vern McKinley, Financing Failure: A Century of Bailouts. Oakland, CA: Independent Institute, 2011. xvi + 381 pp. $17 (paperback), ISBN: 978-1-59813-053-9.

Reviewed for EH.Net by Roy C. Smith, Stern School of Business, New York University.

This book looks deeply into the extensive history of financial bailouts in the United States, mainly focusing on the 1930s, the 1980s and the 2000s, and concludes that although there is little evidence to justify them, they continue to be repeated when financial crises appear.  The author, a Research Fellow at the Independent Institute and a consultant to central banks and financial institutions, has brought to light many details from the 2007-2008 crisis from previously undisclosed documents obtained from the Freedom of Information Act (including some suits initiated by himself), and from scouring the abundant crisis literature that has since appeared.

A “bailout” is defined as any sort of intervention by a government entity, which is done preemptively to prevent a failure of a financial institution, and consequently benefits depositors, creditors or investors. Government officials have always justified bailouts, however distasteful, as being necessary to prevent “disorderly failures” that could collapse the larger financial system and impose far greater cost to the economy than the cost of the assistance. Bailouts not only create moral hazard, they also interfere with free market allocation of financial resources to achieve optimal results.

Geographic Area: 
North America
Subject: 
Financial Markets, Financial Institutions, and Monetary History
Government, Law and Regulation, Public Finance
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

The Age of Equality: The Twentieth Century in Economic Perspective

Author: 
Pomfret, Richard
Reviewer: 
Huberman, Michael

Published by EH.Net (April 2012)

Richard Pomfret, The Age of Equality: The Twentieth Century in Economic Perspective. Cambridge, MA: Harvard University Press, 2011. xi + 283 pp. $29 (hardcover), ISBN: 978-0-674-06217-7.

Reviewed for EH.Net by Michael Huberman, Department of History, Université de Montréal.

Remember the 1970s? As an undergraduate I recall taking a course in Comparative Economic Systems which dealt with different manners of organizing production and economies more broadly. We studied the interdependence of politics and economics, using as examples workers’ self-management in Yugoslavia, countervailing forces in the U.S., import-substitution policies in India, and the social market economy of the German Federal Republic. Richard Pomfret must have taken a similar course – and done extremely well at it.

In this brief but immensely rich, provocative, and rewarding book, Pomfret organizes world economic history in the last century around the battle of competing systems. There are obvious pitfalls with this conceptual framework, but Pomfret, who is a consummate author, is extremely agile in avoiding them. The story begins with the Age of Liberalism attached to the industrial revolution. While the application of new technologies generated a lot of wealth during the long-nineteenth century, not all the gains trickled down and were distributed fairly. Liberal reform in theory was predicated on the idea of equality in opportunities and not outcomes.

Geographic Area: 
General, International, or Comparative
Subject: 
Economic Planning and Policy
Economywide Country Studies and Comparative History
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

Mining and the State in Brazilian Development

Author: 
Triner, Gail D.
Reviewer: 
Hartzmark, Amanda

Published by EH.Net (March 2012)

Gail D. Triner, Mining and the State in Brazilian Development. London: Pickering and Chatto, 2011. xvii +253 pp. $99 (hardcover), ISBN: 978-1-84893-068-1.

Reviewed for EH.Net by Amanda Hartzmark, Department of History, University of Chicago.

The scholarship on Brazilian iron and steel production is extensive.  Historians have examined numerous aspects of these industries ranging from their general impact, to performance, to labor relations and to the characteristics of state-owned enterprise.   Conversely, only a few works address the mining of the minerals that undergirded the iron and steel industries, such as iron ore.       

Gail D. Triner, an Associate Professor of History at Rutgers, presents a political economy of mineral resources in Brazil.  Although her methodology is largely borrowed from “new institutional economic history,” Triner seeks to counter weaknesses in this approach by including “non-human actors,” such as the state and mineral resources (p. 4).  More importantly she shows how producing wealth from mineral resources required the “coordination and accommodation” of existing institutions (p.1).  Triner traces three institutions related to minerals over time: the rules and practices governing property, business enterprise and capital markets.  Triner argues that the structure of institutions was not as important as the interactions among them and further, the interaction between these institutions and mineral resources. 

Geographic Area: 
Latin America, incl. Mexico and the Caribbean
Subject: 
Agriculture, Natural Resources, and Extractive Industries
Government, Law and Regulation, Public Finance
Time period: 
19th Century
20th Century: Pre WWII

Casualties of Credit: The English Financial Revolution, 1620-1720

Author: 
Wennerlind, Carl
Reviewer: 
Carruthers, Bruce G.

Published by EH.Net (March 2012)

Carl Wennerlind, Casualties of Credit: The English Financial Revolution, 1620-1720. Cambridge MA: Harvard University Press, 2011. x + 348 pp. $40 (hardcover), ISBN: 978-0-674-04738-9.

Reviewed for EH.Net by Bruce G. Carruthers, Department of Sociology, Northwestern University.

Geographic Area: 
Europe
Subject: 
Financial Markets, Financial Institutions, and Monetary History
Social and Cultural History, including Race, Ethnicity and Gender
Time period: 
17th Century
18th Century

The Socialist Car: Automobility in the Eastern Bloc

Author: 
Siegelbaum, Lewis H.
Reviewer: 
Patterson, Perry L.

Published by EH.Net (March 2012)

Lewis H. Siegelbaum, editor, The Socialist Car: Automobility in the Eastern Bloc.  Ithaca, NY: Cornell University Press, 2011.  vii + 242 pp. $25 (paperback), ISBN: 978-0-8014-7738-6.

Reviewed for EH.Net by Perry L. Patterson, Department of Economics, Wake Forest University.

The Socialist Car continues along a journey begun in Siegelbaum’s earlier work, Cars for Comrades: The Life of the Soviet Automobile (2008, reviewed at http://eh.net/book_reviews/cars-comrades-life-soviet-automobile, August 2008).  The result of a workshop at the Berlin School for Comparative European History in 2008, the present volume extends Siegelbaum’s research both geographically and in terms of the broader social, urban planning and personal meanings of “automobility” or car culture.

Geographic Area: 
Europe
Subject: 
Economic Planning and Policy
Social and Cultural History, including Race, Ethnicity and Gender
Transport and Distribution, Energy, and Other Services
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

Creating Wine: The Emergence of a World Industry, 1840-1914

Author: 
Simpson, James
Reviewer: 
Johnson, Noel

Published by EH.Net (March 2012)

James Simpson, Creating Wine: The Emergence of a World Industry, 1840-1914.   Princeton: Princeton University Press, 2011.  xxxvii + 318 pp. $39.50 (hardcover), ISBN: 978-0-691-13603-5.

Reviewed for EH.Net by Noel Johnson, Department of Economics, George Mason University. 

After his inauguration as President of France in May of 2007, Nicolas Sarkozy received not one, but two, threatening videos from balaclava wearing terrorists.  The first came from the Abu Hafs al-Masri Brigade, an Islamic group upset with the new President’s association with “Zionists.”  The second video came from discontented wine growers from the South of France, the Comité d’Action Régionale Viticole (CRAV), and demanded that Sarkozy immediately raise the price of wine.  Both groups threatened bloody retaliation.  Perhaps surprisingly, however, it was only the wine growers who made good on their promise through a series of violent riots over the summer.  This story raises several important questions about modern France, the wine industry, and the regulatory state.  Why are French wine producers, or at least those from the south (the Midi), unable to compete in the modern marketplace?  Why do they feel it is the place of the state to shield them from competition?
 

Geographic Area: 
General, International, or Comparative
Europe
Subject: 
Agriculture, Natural Resources, and Extractive Industries
Government, Law and Regulation, Public Finance
International and Domestic Trade and Relations
Markets and Institutions
Time period: 
19th Century
20th Century: Pre WWII

Global Perspectives on Industrial Transformation in the American South

Author: 
Delfino, Susanna
Gillespie, Michele
Reviewer: 
Carlson, Leonard A.

Published by EH.Net (March 2012)

Susanna Delfino and Michele Gillespie, editors, Global Perspectives on Industrial Transformation in the American South. Columbia, MO: University of Missouri Press, 2005.  x + 240 pp.  $30 (paperback), ISBN: 978-0-8262-1583-3.

Reviewed for EH.Net by Leonard A. Carlson, Department of Economics, Emory University.

This volume is a part of the Southern Industrialization Project (SIP), an effort among historians to promote research on the relatively neglected topic of industrial development in the southeastern U.S.  The goal is to counter the view that the South was exclusively agrarian and backwards relative to contemporary nations.  The global perspective in the title reflects in part the research interests of one of editors, Susanna Delfino, who is an historian of Italy and an Italian national.  She compares the U.S. and Italy in “The Idea of Southern Economic Backwardness: A Comparative View of the United States and Italy.”  Looking at Italy as similar to the U.S. allows one to separate the issues of underdevelopment from race to a degree that is hard in the U.S. case alone.  She emphasizes role of the northern political elites in overstating the relative backwardness in both “Souths,” as part of an attempt to affirm the importance of a liberal state in economic development.

Geographic Area: 
General, International, or Comparative
North America
Subject: 
Economywide Country Studies and Comparative History
Servitude and Slavery
Industry: Manufacturing and Construction
Markets and Institutions
Time period: 
18th Century
19th Century
20th Century: Pre WWII

Investing in Life: Insurance in Antebellum America

Author: 
Murphy, Sharon Ann
Reviewer: 
Hilt, Eric

Published by EH.Net (March 2012)

Sharon Ann Murphy, Investing in Life: Insurance in Antebellum America.  Baltimore: Johns Hopkins University Press, 2010.  xii + 395 pp. $65 (hardcover), ISBN: 978-0-8018-9624-8.

Reviewed for EH.Net by Eric Hilt, Department of Economics, Wellesley College.

The first half of the nineteenth century witnessed a transformation of the American economy that some historians have termed the “market revolution.”  Financial markets and institutions played a central role in this process, as banks proliferated and securities markets deepened.  In addition, beginning in the 1820s, insurance companies began to offer American households life insurance policies.  Over the course of the nineteenth century, the business expanded rapidly, and by 1870 more than $2 billion in life insurance was in force in the United States.  The companies that underwrote these policies became important intermediaries within the financial system.

Sharon Ann Murphy’s Investing in Life tells the story of the development of the American life insurance industry through the 1870s.  Best characterized as a business history of antebellum life insurance, Murphy utilizes a rich variety of archival records from early companies, as well as newspapers and printed sources, in presenting her narrative.  The book focuses on the strategies employed by the industry’s entrepreneurs to surmount the challenges they faced in establishing and expanding the business.   

Geographic Area: 
North America
Subject: 
Business History
Time period: 
19th Century

Electronic Value Exchange: Origins of the VISA Electronic Payment System

Author: 
Stearns, David L.
Reviewer: 
Mason, David L.

Published by EH.Net (February 2012)

David L. Stearns, Electronic Value Exchange: Origins of the VISA Electronic Payment System. London: Springer-Verlag, 2011. xxvii + 240 pp. $99 (hardcover), ISBN: 978-1-84996-138-7.

Reviewed for EH.Net by David L. Mason, Department of History, Georgia Gwinnett College.

For a growing number of people, the use of credit and debit cards has replaced cash as the primary way of purchasing goods, and swiping a card with the Visa logo is something that happens nearly two thousand times a second.  What makes this all possible, however, is an efficient and reliable electronic payments system, the creation of which David Stearns tells in Electronic Value Exchange.  In this well-written, concise volume Stearns, an instructor at Seattle Pacific University, details both the technological and organizational challenges that Visa had to overcome in order to link merchants and financial institutions into a seamless worldwide electronic network.  In doing so, he has made a valuable contribution to not only the history of technology, but the broader fields of financial, consumer, and business history

Geographic Area: 
North America
Subject: 
Business History
Time period: 
20th Century: WWII and post-WWII

The Age of Central Banks

Author: 
Giannini, Curzio
Reviewer: 
Wood, John H.

Published by EH.Net (February 2012)

Curzio Giannini, The Age of Central Banks. Cheltenham, UK: Edward Elgar, 2011. xxxi + 298 pp.  $135 (hardcover), ISBN: 978-0-85793-213-6.

Reviewed for EH.Net by John H. Wood, Department of Economics, Wake Forest University.

Modern central banks are known for more than the determination of the money stock.  They are also bank regulators and handlers of financial crises.  This has always been so, Curzio Giannini, former Deputy Director of the International Relations Department of the Bank of Italy, tells us.  He urges economists to think of money not simply as a policy variable in the neoclassical model but as “an institution that is held up by trust: trust in its future purchasing power and trust in the continued convention that payment is complete when money changes hands” (p. xxv).  At the center of the institution of money is the institution of the central bank.

The principal controversies surrounding monetary institutions – such as the British Bank Act of 1844, the Bank of England as lender of last resort, the Federal Reserve as a solution to the inelasticity of the currency, and Bretton Woods and international trade – have addressed the viability of the payments system rather than simply the price level.  Price stability was taken care of by the monetary standard during most of history.  The growth of a complex payments system, and the need for trust, or confidence, in that system gave rise to central banks.

Geographic Area: 
General, International, or Comparative
Subject: 
Financial Markets, Financial Institutions, and Monetary History
Time period: 
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Erasing the Invisible Hand: Essays on an Elusive and Misused Concept in Economics

Author: 
Samuels, Warren J.
Reviewer: 
Kennedy, Gavin

Published by EH.Net (February 2012)

Warren J. Samuels (assisted by Marianne F. Johnston and William H. Perry), Erasing the Invisible Hand: Essays on an Elusive and Misused Concept in Economics. New York: Cambridge University Press, 2011. xxviii + 329 pp. $95 (hardcover), ISBN: 978-0-521-51725-6.

Reviewed for EH.Net by Gavin Kennedy, Edinburgh Business School, Heriot-Watt University, Edinburgh (Professor Emeritus).

Warren Samuels was an American historian of economic thought located at the top of its first division.  He started work for this book in 1983 and took 28 years to complete.   This was no rushed job and it shows in his meticulous and, therefore, authoritative scholarly account of the now widely quoted “invisible hand” (pp. 20-26). Smith did not “coin” the phrase. It was prevalent in classical times from Aeschylus through to St Augustine, and later, in numerous seventeenth- and eighteenth-century theological texts, sermons, plays (Shakespeare), poems, and novels (Defoe, Walpole), and in political rhetoric (George Washington).  
 
Adam Smith used it only twice as a metaphor in his Theory of Moral Sentiments (1759) and Wealth of Nations (1776), and once in his History of Astronomy (1795, posthumous). After Smith, there was an absence of mentions of the invisible hand metaphor among economists to 1875 and near silence thereafter until it was rediscovered and re-invented into the “founding concept” of modern economics from the 1940s.

Geographic Area: 
General, International, or Comparative
Subject: 
History of Economic Thought; Methodology
Time period: 
18th Century
20th Century: WWII and post-WWII

Triumph of the City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier, and Happier

Author: 
Glaeser, Edward L.
Reviewer: 
Smith, Fred H.

Published by EH.Net (February 2012)

Edward L. Glaeser, Triumph of the City: How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier, and Happier.  New York: Penguin Press, 2011.  ix + 338 pp. $30 (cloth), ISBN: 978-1-59420-277-3.

Reviewed for EH.Net by Fred H. Smith, Department of Economics, Davidson College.

In 1998 Edward Glaeser published an article in the Journal of Economic Perspectives entitled “Are Cities Dying?”  The article makes a strong case for why technology had not, and would not, make cities obsolete.  In the subsequent fourteen years, Glaeser has written dozens of articles on urban economics.  Many of the articles have touched on topics that are of great interest to urban economic historians: From “Are Ghettos Good or Bad” to “Why the Poor Live in Cities” Glaeser addresses topics that have informed our understanding of how, and why, cities have evolved over time. 

In his new book, Triumph of the City: How Our Greatest Invention Makes us Richer, Smarter, Greener, Healthier, and Happier, Glaeser assembles a layperson’s tour of his life’s work in urban economics.  Triumph of the City is an effective coda to his article from 1998, for it demonstrates that not only is the city not dying, it is essential to our continued well-being as a species. 

Geographic Area: 
General, International, or Comparative
Subject: 
Urban and Regional History
Time period: 
General or Comparative
20th Century: WWII and post-WWII

Before and Beyond Divergence: The Politics of Economic Change in China and Europe

Author: 
Rosenthal, Jean-Laurent
Wong, R. Bin
Reviewer: 
Ma, Debin

Published by EH.Net (February 2012)

Jean-Laurent Rosenthal and R. Bin Wong, Before and Beyond Divergence: The Politics of Economic Change in China and Europe. Cambridge, MA: Harvard University Press, 2011. xi + 276 pp. $45 (hardback), ISBN: 978-0-674-05791-3.

Reviewed for EH.Net by Debin Ma, Department of Economic History, London School of Economics.

This book is the latest installment in the Great Divergence debate, which could also be simplified as the question of why the Industrial Revolution (IR) happened in England or Europe, but not in China or Asia. Written by two leading scholars on French and Chinese economic history, respectively, this book makes a new contribution to this debate with a focused, theme-by-theme comparison of similarities and differences between China and Europe. Too often, as the two authors correctly point out, our views of long-run economic growth and the IR have been informed by the English experience, from which a unilinear model of growth is drawn. Their book, by carefully pairing and meshing the narratives of Europe and China with relatively equal weight, is a welcome departure in this genre. It is also a stylistic success, with economic theory seamlessly woven into the narrative and with schematic economic models usually spelled out in separate boxes within the chapters.

Geographic Area: 
Asia
Europe
Subject: 
Economic Development, Growth, and Aggregate Productivity
Economywide Country Studies and Comparative History
Time period: 
Medieval
16th Century
17th Century
18th Century
19th Century

The Institutional Revolution: Measurement and the Economic Emergence of the Modern World

Author: 
Allen, Douglas W.
Reviewer: 
Koyama, Mark

Published by EH.Net (February 2012)

Douglas W. Allen, The Institutional Revolution: Measurement and the Economic Emergence of the Modern World. Chicago: University of Chicago Press, 2011.  xiv + 267 pp. $30 (cloth), ISBN: 978-0-226-01474-6.

Reviewed for EH.Net by Mark Koyama, Department of Economics, George Mason University.

In this astute and elegantly written book, Douglas Allen argues that the industrial revolution was accompanied by an institutional revolution. This institutional revolution replaced many seemingly archaic institutions such as the practice of restricting some offices in government to aristocrats while selling others (including army commissions and the right to collect taxes). The revolution substituted public for private provision in areas such as the building of roads and lighthouses and led to the rise of a professional bureaucracy and police force.  Allen's point is not that these early pre-modern institutions were inefficient or wasteful. On the contrary, in his account, they were adapted for their environment: the high variance, high measurement cost, early modern world.

Geographic Area: 
Europe
Subject: 
Government, Law and Regulation, Public Finance
Military and War
Markets and Institutions
Time period: 
18th Century
19th Century

Philanthropy in America: A History

Author: 
Zunz, Olivier
Reviewer: 
Frey, Donald E.

Published by EH.Net (January 2012)

Olivier Zunz, Philanthropy in America: A History. Princeton, NJ: Princeton University Press, 2011.  x + 381 pp. $30 (hardcover), ISBN: 978-0 691-12836-8.
    
Reviewed for EH.Net by Donald E. Frey, Department of Economics, Wake Forest University (retired).

Olivier Zunz starts his history in the late 1800s, focusing on big foundations along with the “mass philanthropy” of the middle class. A recurring theme is the enduring difficulty in defining the boundaries between government and philanthropy. 

The story that Zunz chooses to tell, though not comprehensive, is fascinating; and he tells it well. Chapter 1 recounts emerging dissatisfaction with traditional “charity” in the late 1800s. But the real story is the forming of the first great foundations, which grandly and vaguely aimed for “the improvement of mankind” (p. 8). This challenged legal doctrine that had defined charitable purposes very narrowly. Early foundations chose two major emphases: advancing science, which implied reshaping higher education; and improving the status of African-Americans in the U.S. South.
  
The second chapter moves to popular “mass philanthropy,” which was born in fighting diseases, such as TB (as early as 1908). World War I stimulated mass giving as patriotism provided a new motive. About this time, forerunners of the United Way emerged to consolidate charitable appeals and apply business-like, calculating methods to fundraising.
    
Chapter 3 introduces the earliest difficulties of differentiating the roles of government and the roles of philanthropy. The issue was related to defining tax incentives for charitable giving. The chapter is too rich in detail to recount here.

Geographic Area: 
North America
Subject: 
Education and Human Resource Development
Social and Cultural History, including Race, Ethnicity and Gender
Time period: 
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Creative Reconstructions: Multilateralism and European Varieties of Capitalism after 1950

Author: 
Fioretos, Orfeo
Reviewer: 
Coates, David

Published by EH.Net (January 2012)

Orfeo Fioretos, Creative Reconstructions: Multilateralism and European Varieties of Capitalism after 1950. Ithaca, NY: Cornell University Press, 2011. xix + 245 pp. $50 (hardcover), ISBN: 978-0-8014-4969-7.

Reviewed for EH.Net by David Coates, Department of Political Science, Wake Forest University.

There is now a long established interest in the character and economic fortunes of different models of capitalism. Important debates continue about their internal dynamics of change. Do modern economies flourish to the degree to which we find “institutional complementaries” within them, as in the original “varieties of capitalism” (VOC) formulation by Hall and Soskice; or do we need to bring something “back in” to supplement or replace the incipient “institutional determinism” of that approach? Do we need to make the “constructivist” turn favored by Vivien Schmidt and others, or do we need to make the “class” turn favored by analysts influenced by an on-going stream of Marxist scholarship? If the argument of this impressively researched and coherently argued work by Orfeo Fioretos holds, the intellectual turn we need to take is towards behavioral economics and the concerns of international political economy, by recognizing the role multilateral strategies play (and have played in the immediate past) in shaping the trajectory of particular European capitalisms and the incentive structures operating on their key firms. We need to bring “the state” back in to our analyses, but to do so in a new and important way.

Geographic Area: 
Europe
Subject: 
Economic Planning and Policy
Economywide Country Studies and Comparative History
Markets and Institutions
Time period: 
20th Century: WWII and post-WWII

Economic Evolution and Revolution in Historical Time

Author: 
Rhode, Paul W.
Rosenbloom, Joshua L.
Weiman, David F.
Reviewer: 
Moehling, Carolyn M.

Published by EH.Net (January 2012)

Paul W. Rhode, Joshua L. Rosenbloom, and David F. Weiman, editors, Economic Evolution and Revolution in Historical Time. Stanford, CA: Stanford University Press, 2011. xx + 461 pp. $60 (hardcover), ISBN: 978-0-8047-7185-6.

Carolyn M. Moehling, Department of Economics, Rutgers University.

Geographic Area: 
Africa
Australia/New Zealand, incl. Pacific Islands
North America
Subject: 
Agriculture, Natural Resources, and Extractive Industries
Education and Human Resource Development
Financial Markets, Financial Institutions, and Monetary History
Government, Law and Regulation, Public Finance
Servitude and Slavery
Industry: Manufacturing and Construction
Labor and Employment History
Markets and Institutions
Time period: 
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

At the Edge of Camelot: Debating Economics in Turbulent Times

Author: 
Katzner, Donald W.
Reviewer: 
Ruccio, David F.

Published by EH.Net (January 2012)

Donald W. Katzner, At the Edge of Camelot: Debating Economics in Turbulent Times. Oxford: Oxford University Press, 2011. xiv + 199 pp. $50 (hardcover), ISBN: 978-0-19-976535-5.

Reviewed by David F. Ruccio, Professor of Economics, University of Notre Dame

Donald W. Katzner, in invoking the Arthurian legend, may have run the risk of overselling the Department of Economics at the University of Massachusetts Amherst. However, both the department he and his colleagues built and his book documenting the history of that department are, in fact, quite honorable.*

The department was remarkable because, with very few exceptions (then or now) among the 125 or so Ph.D.-granting economics programs in the United States, it challenged the prevailing orthodoxy by hiring a significant number of “radical” economists and by training a much larger number of graduate students. It literally defined and then extended the frontiers of radical political economy. And it did so with a neoclassical economist (Katzner himself) as the chair during its early, formative years.

The book itself is noteworthy because it is the only history of an economics department of which I am aware (Frederic Lee’s [2011] effort, which can be usefully read as a companion volume, is a much wider history of heterodox economics in the twentieth century), and it was written by a key participant. The most valuable sections of the book consist of Katzner’s recollections from the 1976-1981 period when he served as chair (with the appropriate caveats about fallible memory), supplemented by interviews he conducted with other participants (both faculty and graduate students) and documents he collected (from before and during his time as chair).

Geographic Area: 
North America
Subject: 
History of Economic Thought; Methodology
Time period: 
20th Century: WWII and post-WWII

Economists in the Americas

Author: 
Montecinos, Verónica
Markoff, John
Reviewer: 
Boianovsky, Mauro

Published by EH.Net (January 2012)

Verónica Montecinos and John Markoff, editors, Economists in the Americas. Cheltenham, UK: Edward Elgar, 2009. xx + 341 pp. $155 (hardcover), ISBN: 978-1-84542-043-7.

Reviewed for EH.Net by Mauro Boianovsky, Department of Economics, Universidade de Brasília.

Largely thanks to Bob Coats’s (1924-2007) pioneering studies about the sociology and professionalization of economics, research about the emergence of economics as a discipline and the development of the contexts and institutions in which economists act have become an important area in the history of economic thought. One should expect that the subject would attract also the attention of social scientists such as sociologists and political scientists. Economists in the Americas, edited by sociologists Verónica Montecinos and John Markoff (from Pennsylvania State University and University of Pittsburgh, respectively), offers a detailed investigation of the history of the economics profession in the Americas in the form of case studies of a representative set of Latin American countries (Argentina, Brazil, Chile, Colombia, Mexico and Uruguay) plus one chapter about the United States.  Coats focused on North American and British economic thought; a couple of Latin American case studies (particularly about Brazil, by Paulo R. Haddad and Maria R. Loureiro, whose essay is partly reproduced in the volume under review) can be found in the 1981 and 1997 collections edited by him for the History of Political Economy (HOPE) about economists in the government and the internationalization of economics after 1945. Economists in the Americas, as acknowledged by the editors, adds to Coats’s path-breaking research and follows his lead and inspiration.

Geographic Area: 
Latin America, incl. Mexico and the Caribbean
Subject: 
History of Economic Thought; Methodology
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

The Decline of Jute: Managing Industrial Decline

Author: 
Tomlinson, Jim
Morelli, Carlo
Wright, Valerie
Reviewer: 
Stewart, Gordon

Published by EH.Net (January 2012)

Jim Tomlinson, Carlo Morelli and Valerie Wright, The Decline of Jute: Managing Industrial Decline.  London: Pickering and Chatto, 2011.  xiii + 219 pp. $99 (hardcover), ISBN: 978-1-84893-124-4.

Reviewed for EH.Net by Gordon Stewart, Department of History, Michigan State University.

This superb book deserves to be considered for a prize. It is a close-grained account of the jute industry in Dundee from the 1940s to the 1980s but it is much more than that. In the course of their study of the decline of one industry the authors lay bare some of the fundamental economic, social, and political forces that shaped post-war Britain, and illuminate the complex impact of globalization on the manufacturing sector of the British economy. Many books on such topics end up by focusing on one aspect of the story – whether it be the role of capital, government policies, strategies of employers, or the responses and actions of workers. The three authors deftly bring together every dimension. The narrative and analysis move easily from women workers, who dominated the jute labor force until the late 1950s, to the policy deliberations of civil service mandarins at the Board of Trade, while fully acknowledging the ultimately inescapable pressures exerted by the international macroeconomic environment. Valerie Wright’s sure exposition of the complex gender issues at play among the workers sits informatively alongside the economic and policy analyses of Jim Tomlinson and Carlo Morelli. It is a remarkable achievement for three authors to produce such a coherent narrative, and a ringing tribute to the benefits of collaborative scholarship.

Geographic Area: 
Europe
Subject: 
Economic Planning and Policy
Industry: Manufacturing and Construction
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

Why Europe Grew Rich and Asia Did Not: Global Economic Divergence, 1600-1850

Author: 
Parthasarathi, Prasannan
Reviewer: 
Mokyr, Joel

Published by EH.Net (January 2012)

Prasannan Parthasarathi, Why Europe Grew Rich and Asia Did Not: Global Economic Divergence, 1600-1850. Cambridge: Cambridge University Press, 2011. 365 pp. $30 (paperback), ISBN: 978-0-521-16824-3.

Reviewed for EH.Net by Joel Mokyr, Departments of Economics and History, Northwestern University.

The year 2011 was  a banner year for ambitious books that explain what is becoming known as the “Great Divergence” of the West and the Rest. In addition to the book under review here, two other books by major scholars have appeared: Jean-Laurent Rosenthal and Bin Wong’s Before and Beyond Divergence and Ian Morris’s Why the West Rules for Now. One would have hoped that the proliferation of this literature would perhaps start to converge toward a consensus, but alas, so far discord and confusion reign in this debate. One could call it perhaps “the small divergence.”

Geographic Area: 
Asia
Europe
Subject: 
Economic Development, Growth, and Aggregate Productivity
Economic Planning and Policy
Economywide Country Studies and Comparative History
Industry: Manufacturing and Construction
Markets and Institutions
Time period: 
17th Century
18th Century
19th Century

So Great a Proffit: How the East Indies Trade Transformed Anglo-American Capitalism

Author: 
Fichter, James R.
Reviewer: 
Cox, Thomas H.

Published by EH.Net (January 2012)

James R. Fichter, So Great a Proffit: How the East Indies Trade Transformed Anglo-American Capitalism. Cambridge: Harvard University Press, 2010. xi + 384 pp. $35 (hardcover), ISBN: 978-0-674-05057-0.

Reviewed for EH.Net by Thomas H. Cox, Department of History, Sam Houston State University.

James R. Fichter’s So Great a Proffit: How the East Indies Trade Transformed Anglo-American Capitalism sheds new light on America’s early trade with Asia during the late 1700s and early 1800s. Seeking to move beyond traditional portrayals of national economic development, Fichter contends that “American trade to the East Indies as a whole had repercussions for society, economics, and politics on both sides of the Atlantic” (p. 4). In particular, competition from private American merchants undermined British mercantilism and “helped begin Britain’s nineteenth century free trade empire.” For the young American republic trade with Asia meant “the accumulation of wealth and financial capital into the hands of the wealthiest Americans, creating financiers who would profoundly alter the shape of American business” (p. 4). Located at the intersection of economic, cultural, American, and British history, Fichter’s work is necessarily broad based, painting in broad strokes themes for future historians to further flesh out.

Geographic Area: 
Asia
Australia/New Zealand, incl. Pacific Islands
Europe
North America
Subject: 
International and Domestic Trade and Relations
Time period: 
18th Century
19th Century

Famous Figures and Diagrams in Economics

Author: 
Blaug, Mark
Lloyd, Peter
Reviewer: 
Whaples, Robert

Published by EH.Net (December 2011)

Mark Blaug and Peter Lloyd, editors, Famous Figures and Diagrams in Economics.  Cheltenham, UK: Edward Elgar, 2010. xvii + 468 pp. £112.50 (hardcover), ISBN: 978-1-84844-160-6.

Reviewed for EH.Net by Robert Whaples, Department of Economics, Wake Forest University.

As Avinash Dixit puts it, “The only correct answer to the question whether economics is a science or an art is ‘Both’” (p. 327). And perhaps our best “art” is didactic – the useful, but creative graphs and diagrams that we use in our articles, textbooks and classrooms. Mark Blaug (Professor Emeritus at the University of London and the University of Buckingham) and Peter Lloyd (Professor Emeritus at the University of Melbourne) have enlisted a stellar international cast of contributors to provide an account of the role and history of about sixty figures and diagrams used in economic analysis.  “We have selected figures that have been prominent in the history of economic analysis and that are, with a few exceptions, still found in contemporary textbooks and research” (p. 1). If you use these diagrams in your research or teaching, you may learn a lot from this pithy collection.

The editors’ introduction makes a compelling case that economists have shown great ingenuity in devising figures and diagrams.  While the use of these geometric diagrams “as a device for discovery and proof has declined in recent decades” (p. 7), their effectiveness as an expository device – especially in the classroom – has endured.  Many of us reflexively think in terms of these diagrams, so it’s worthwhile to consider their origins and delve deeper into their assumptions and nuances. 

Geographic Area: 
General, International, or Comparative
Subject: 
History of Economic Thought; Methodology
Time period: 
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Capitalist Revolutionary: John Maynard Keynes

Author: 
Backhouse, Roger E.
Bateman, Bradley W.
Reviewer: 
Kates, Steven

Published by EH.NET (December 2011)

Roger E. Backhouse and Bradley W. Bateman, Capitalist Revolutionary: John Maynard Keynes. Cambridge, MA: Harvard University Press, 2011. 208 pp. $26 (hardcover), ISBN: 978-0-674-05775-3.

Reviewed for EH.Net by Steven Kates, School of Economics, Finance, and Marketing, RMIT University, Melbourne.

Two prominent economists, one English and one American, have written a book about how Keynes and Keynesian economics have shown their mettle over these troubled years since the Global Financial Crisis (GFC). Roger Backhouse and Brad Bateman have titled their work Capitalist Revolutionary: John Maynard Keynes. It is a work of counter-revisionist history even before we revisionists have had a chance to tell our own story first.

The book is about the non-war in economics that ought to be happening but isn’t. It is a defense of Keynes and Keynesian economics against post-stimulus attacks that, other than in a few instances, have not occurred at all. It sets Keynes up as a counter to an extreme libertarian laissez-faire strawman view of how economies ought to be left alone in all instances, first in their regulation and then in allowing recessions to burn themselves off when they come. They therefore conclude that given this is the choice, Keynes is the answer. Well, if that were the choice, Keynes would be the answer, but since it’s not the actual choice we have, they do not really satisfy the criticisms of anyone who holds neither Keynesian nor such extreme libertarian views.

Geographic Area: 
General, International, or Comparative
Subject: 
History of Economic Thought; Methodology
Macroeconomics and Fluctuations
Time period: 
20th Century: Pre WWII
20th Century: WWII and post-WWII

The Changing Body: Health, Nutrition, and Human Development in the Western World since 1700

Author: 
Floud, Roderick
Fogel, Robert W.
Harris, Bernard
Hong, Sok Chul
Reviewer: 
Cvrcek, Tomas

Published by EH.NET (December 2011)

Roderick Floud, Robert W. Fogel, Bernard Harris and Sok Chul Hong, The Changing Body: Health, Nutrition, and Human Development in the Western World since 1700. Cambridge: Cambridge University Press, 2011. xxvi + 431 pp. $33 (paperback), ISBN: 978-0-521-70561-5.

Reviewed for EH.Net by Tomas Cvrcek, Department of Economics, Clemson University.

If you care about the quality of life of yourself in old age and of your descendants over the next few generations, I am pleased to report that the authors of The Changing Body have mostly good news for you. (More on that later.)

This book is a result of several decades of research into the interaction between economic development and human biology. The reader will revisit all the important debates closely or loosely connected with the historical record of living standards: these include the “antebellum puzzle,” the “industrious revolution” and the amount and intensity of work supplied, the McKeown (1976) debate about the relative importance of nutrition in the decline of mortality, and – inevitably – the mother of all these feuds, the pessimists versus optimists vis-à-vis living standards during the British Industrial Revolution.

Geographic Area: 
Europe
North America
Subject: 
Living Standards, Anthropometric History, Economic Anthropology
Time period: 
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Locating the Industrial Revolution: Inducement and Response

Author: 
Jones, Eric L.
Reviewer: 
Bogart, Dan

Published by EH.NET (December 2011)

Eric L. Jones, Locating the Industrial Revolution: Inducement and Response. Singapore: World Scientific, 2010. vii + 272 pp. $68 (hardcover), ISBN: 978-981-4295-25-3.

Reviewed for EH.Net by Dan Bogart, Department of Economics, University of California -- Irvine.

The Industrial Revolution is often modeled as a national or continental phenomenon.  The most common questions are why did Britain industrialize first and not France, or why Europe and not Asia? However, there is a case to be made that the Industrial Revolution was a regional phenomenon. Here the classic question is why did northern England industrialize and southern England not. Southern England was more densely populated and had significant manufacturing ca.1700. Its de-industrialization poses a puzzle.  

Geographic Area: 
Europe
Subject: 
Economic Development, Growth, and Aggregate Productivity
Industry: Manufacturing and Construction
Urban and Regional History
Time period: 
18th Century
19th Century
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