American Economic History

ECONOMICS 696X, AMERICAN ECONOMIC HISTORY

Fall Semester 2001
University of Arizona
Professor Gary D. Libecap
202 McClelland Hall, 621-4821
glibecap@bpa.arizona.edu
Office hours: email at any time; phone for appointment

The course objective is to provide you with insights into the economic history and development
of the American economy, comparisons between American economic growth and that of other
economies, and an understanding of factors that seem to promote (or retard) economic
development. Assigned readings selected from the material below will be discussed in each
class. Each student will prepare a summary assessment of the readings and be prepared to lead
discussion in each class. Students will be selected randomly to lead discussion. Assessment
papers are due at the end of each class period. The final exam will be an essay exam, addressing
specific discussion areas covered during the semester.

Grading: Cumulative Assessment papers/presentations: 60% of course grade
Final exam: 40% of course grade

All missed classes must have approved excuses and all missing papers must be made up withina
week, unless other arrangements are made.

Course material:

Primary:
Jeremy Atack and Peter Passell, A New Economic View of American History, WW.
Norton, 2nd Edition.
A copy of the US Constitution.
Gary Libecap, Contracting for Property Rights, Cambridge University Press.
Jared M. Diamond, 1997, Guns, Germs, and Steel: The Fate of Human Societies, WW.
Norton, New York.
Supplemental:
David Landes, 1998, The Wealth and Poverty of Nations: Why Some are so Rich and
Some So Poor, WW Norton.
Kenneth Pomeranz, 2000, The Great Divergence: Europe, China, and the Making of the
Modern World Economy, Princeton University Press.
Joel Mokyr, The Lever of Riches: Technological Creativity and Economic Progress,
Oxford University Press, 1990.
Robert Barro, Determinants of Economic Growth: A Cross-Country Empirical Study,
MIT Press, 1997.
Douglass North, Institutions, Institutional Change, and Economic Performance, 1990,
Cambridge University Press.

Readings will be in hard copy and/or on electronic reserve.

I. An Overview of American Economic Performance.

1. GNP and Per Capita Income:

Primary:
Atack and Passell, Chapter 1.
Paul Romer, "Why Indeed, in America? Theory, History, and ...Economic Growth,"
American Economic Review, May 1996, 202-6 .
David Galenson, "The Settlement and Growth of the Colonies: Population, Labor, and
Economic Development," in Stanley Engerman and Robert Gallman, eds, The Cambridge
Economic History of the United States, vol. I, 135-207.
Robert E. Gallman, "Economic Growth and Structural Change in the Long Nineteenth
Century," in Stanley Engerman and Robert Gallman, eds, The Cambridge Economic
History of the United States, vol. II, 1-56.
Robert E. Gallman, "Gross National Product in the United States, 1834-1909," in Output,
Employment, and Productivity in the United States after 1800, Studies in Income and
Wealth, Vol. 30, 1966, 3-76.
Moses Abramovitz and Paul David, "American Macroeconomic Growth in the Era of
Knowledge-Based Progress: The Long Run Perspective," in Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, vol. 3,
2000, 1-92.
Supplemental:
Peter Mancall and Thomas Weiss, "Was Economic Growth Likely in Colonial British
North America?" Journal of Economic History, 59 (1), 17-40.
Richard Steckel, "Stature and Living Standards in the United States," in Robert Gallman
and John Wallis eds, American Economic Growth and Standards of Living before the
Civil War, 1992, 265-310.

2. Income and Wealth Distribution.

Required:
Simon Kuznets, March 1955, "Economic Growth and Economic Inequality," American
Economic Review, 1-28.
Klaus Deininger and Lyn Squire, "A New Data Set Measuring Income Inequality," The
World Bank Economic Review, 10 (3), 565-91.
Claudia Goldin and Robert Margo, 1992, "The Great Compression: The Wage Structure
in the US at MidCentury," Quarterly Journal of Economics, 107 (1): 1-34.
Clayne Pope, "Inequality in the Nineteenth Century," in Stanley Engerman and Robert
Gallman, eds, The Cambridge Economic History of the United States, vol. II, 109-42.
Robert Plotnick, Eugene Smolensky, Eirik Evenhouse, and Siobhan Reilly, "The
Twentieth-Century Record of Inequality and Poverty in the United States," in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, Vol. 3, 2000, 249-300.
Thomas Piketty and Emmanuel Saez, "Income Inequality in the United States, 1913-
1998," working paper, Harvard University, April 2001
Jeffrey Williamson and Peter Lindert, "Does Globalization Make the World More
Unequal?" April 2001 NBER working paper 8228
Supplemental:
Jeffrey Williamson and Peter Lindert, 1985, "Growth, Equality, and History,"
Explorations in Economic History 341-77.
Lee Soltow, "Inequalities in the Standard of Living in the United States, 1798-1875," in
Robert Gallman and John Wallis eds, American Economic Growth and Standards of
Living before the Civil War, 1992, 121-172.

II. Comparisons with Other Economies, with Emphasis on Explaining the Sources of
Divergent Growth Patterns.

1. General Comparisons.

Required:
Angus Maddison, 1983, "A Comparison of Levels of GDP Per Capita in Developed and
Developing Countries, 1700-1980, Journal of Economic History, March, 27-41.
William Baumol, "Productivity Growth, Convergence, and Welfare: What the Long-Run
Data Show," American Economic Review, December 1986, 1072-85.
Robert Barro, 1991. "Economic Growth in a Cross Section of Countries." Quarterly
Journal of Economics 106, 2 (May): 407-433.
Robert Barro, "Inequality and Growth in a Panel of Countries," Harvard Economics
Department Working paper, 1999.
Robert Barrow, "Inequality, Growth, and Investment, NBER Working Paper 7038.
Jared M. Diamond, 1997, Guns, Germs, and Steel: The Fate of Human Societies, WW.
Norton, New York.
Supplemental:
David Landes, 1998, The Wealth and Poverty of Nations: Why Some are so Rich and
Some So Poor, WW Norton.
Kenneth Pomeranz, 2000, The Great Divergence: Europe, China, and the Making of the
Modern World Economy, Princeton University Press.
Joel Mokyr, The Lever of Riches: Technological Creativity and Economic Progress,
Oxford University Press, 1990.
Robert Barro, Determinants of Economic Growth: A Cross-Country Empirical Study,
MIT Press, 1997.

2. Differences in Colonial Long-Term Development.

Kenneth Sokoloff and Stanley L. Engerman, "History Lessons: Institutions, Factor
Endowments, and Paths of Development in the New World," Journal of Economic
Perspectives, 14 (3), Summer 2000, 217-232.
Stanley Engerman and Kenneth Sokoloff, "Factor Endowments, Institutions, and
Differential Paths of Growth Among New World Economies: A View from Economic
Historians of the United States," in Stephen Haber, ed., How Latin America Fell Behind,
1997, Stanford University Press, 260-304.
Daron Acemoglu and James Robinson, "The Colonial Origins of Comparative
Development: An Empirical Investigation," American Economic Review, forthcoming.
Lee Alston, Gary Libecap, and Robert Schneider, "The Determinants and Impact of
Property Rights: Land Titles on the Brazilian Frontier," Journal of Law, Economics and
Organization, 1996.
Supplemental:
Stanley Engerman, Stephen Haber, and Kenneth Sokoloff, "Inequality, Institutions, and
Differential Paths of Growth Among New World Economies," working paper, UCLA.
Richard Sylla, "Emerging Markets in History: The United States, Japan, and Argentina,"
in R. Sato et. al, eds, Global Competition and Integration Boston, Kluwer Academic,
1999.

III. Sources of Economic Growth: U.S. and Elsewhere.

1. Natural Resource Endowments.

Required:
Daron Acemoglu, Simon Johnson, and James A. Robinson, "Reversal of Fortune:
Geography and Institutions in the Making of the Modern World Income Distribution,"
working paper, MIT, July 5, 2001.
Sachs, Jeffrey D., 2001, "Tropical Underdevelopment," NBER Working Paper, 8119.
Gavin Wright, "Resource-Based Growth Then and Now," working paper, Stanford
University, June 2001.
Atack and Passell, Chapters 9, 15
Gavin Wright, "The Origins of American Industrial Success, 1879-1940," American
Economic Review, September 1990, p. 651-68.
Supplemental:
David Galenson and Clayne Pope, 1989, "Economic and Geographic Mobility on the
Farming Frontier: Evidence from Appanoose County, Iowa, 1850-1870," Journal of
Economic History, September, 635-55.
Joseph Ferrie, "The Wealth Accumulation of Antebellum Immigrants to the US, 1840-
60," Journal of Economic History, March 1994, 1-33

2. Labor Force, Education, and Health.

Required:
Atack and Passell, Chapters 8, 19.
Joshua Rosenbloom, 1990, "One Market or Many? Labor Market Integration in the Late
Nineteenth Century United States," Journal of Economic History, March 85-107.
Robert Margo, "The Labor Force in the Nineteenth Century," Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, vol. II, 207-
244.
Claudia Goldin, "Labor Markets in the Twentieth Century," in Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, Vol. 3,
2000, 549-624.
Kevin Murphy, Andrei Shleifer, and Robert Vishny, "The Allocation of Talent:
Implications for Growth," Quarterly Journal of Economics, May 1991.
Claudia Goldin, "America's Graduation from High School: The Evolution and Spread of
Secondary Schooling in the Twentieth Century," Journal of Economic History, June
1998, 345-374.
Robert Fogel, "Nutrition and the Decline in Mortality since 1700: Some Preliminary
Findings," in Stanley Engerman and Robert Gallman, eds, 1986, Long Term Factors in
American Economic Growth, Vol 51, 439-555.
Michael R. Haines, "The Population of the United States, 1790-1920," in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, vol. II, 143-206.
Richard Easterlin, "Twentieth-Century American Population Growth, in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, Vol. 3, 2000, 505-549.
Supplemental:
Frank Lewis, 1979, "Explaining the Shift of Labor from Agriculture to Industry in the
United States: 1869-1899," Journal of Economic History, September 681-98.
Claudia Goldin and Lawrence F. Katz, "Education and Income in the Early Twentieth
Century: Evidence from the Prairies," Journal of Economic History, September 2000.
Peter H. Lindert, "Democracy, Decentralization, and Mass Schooling Before 1914,
Appendices," working paper, Agricultural History Center, UC Davis.
George Borjas, "National Origin and the Skills of Immigrants in the Postwar Period," in
Immigration and the Workforce, George Borjas and Richard Freeman, eds, 1992, 17-48.
Claudia Goldin, "The Political Economy of Immigration Restriction in the United States,
1890-1921, in Claudia Goldin and Gary Libecap, eds, The Regulated Economy: A
Historical Approach to Political Economy, 223-57.

3. Market Size and Economies of Scale.

Required:
Atack and Passell, Chapter 6, 7, 16, 17.
Jeremy Atack, 1986, "Firm Size and Industrial Structure in the United States in the
Nineteenth Century," Journal of Economic History June 463-75.
Gary Libecap, 1992, "The Rise of the Chicago Packers and the Origins of Meat
Inspection and Antitrust,' Economic Inquiry, 242-62.
Sukko Kim, 1995, "Expansion of Markets and the Geographic Distribution of Economic
Activities: The Trends in US Regional Manufacturing Structure, 1860-1987," Quarterly
Journal Economics.
Supplemental:
Jeremy Atack, 1985 "Industrial Structure and the Emergence of the Modern
Corporation," Explorations in Economic History, January, 29-52.
Alfred Chandler, 1992, "Organizational Capabilities and the Economic History of the
Industrial Enterprise," Journal of Economic Perspectives, Summer, 79-100.

4. Technology.

Required:
Atack and Passell, Chapters 8, 10.
Kenneth Sokoloff, "Inventive Activity in Early Industrial American," Journal of
Economic History, 48, December 1988, 813-50.
Stanley Engerman and Kenneth Sokoloff, "Technology and Industrialization, 1790-
1914," in Stanley Engerman and Robert Gallman, eds, The Cambridge Economic History
of the United States, vol. II, 367-402.
David Mowery and Nathan Rosenberg, "Twentieth Century Technological Change," in
Stanley Engerman and Robert Gallman, eds, The Cambridge Economic History of the
United States, Vol. 3, 2000, 803-926.
Romer, Paul, 1990, "Endogenous Technical Change," Journal of Political Economy, 98,
S71-S102.
Josh Lerner, "150 Years of Patent Protection."" (Harvard Business School Working
Paper #00-039 and National Bureau of Economic Research Working Paper No. 7477),
2000.
Robert Barro, "Technological Diffusion, Convergence, and Growth," NBER working
paper, 5151, 1995.
Supplemental:
Zorina Khan and Ken Sokoloff, 1993,"Schemes of Practical Utility Entrepreneurship and
Innovation Among 'Great Inventors' in the United States, 1790-1865," Journal of
Economic History, June, 289-307.
Stephen Broadberry, 1998, "How Did the United States and Germany Overtake Britain?
A Sectoral Analysis of Comparative Productivity Levels, 1870-1990," Journal of
Economic History, June 375-407.
Claudia Goldin and Lawrence Katz, 1998, "The Origins of Technology-Skill
Complementarity," Quarterly Journal of Economics, August.
David Mowery, 1983, "Industrial Research and Firm Size, Survival and Growth in
American Manufacturing, 1921-1946: An Assessment," Journal of Economic History,
December, 953-80.
Josh Lerner, "150 Years of Patent Office Practice."" (Harvard Business School Working
Paper #00-040 and National Bureau of Economic Research Working Paper No. 7478),
2000.

5. Institutions: Laws, Contracts, Property Rights.

Required:
Atack and Passell, Chapter 23.
The US Constitution.
Douglass North, "Institutions," Journal of Economic Perspectives, 1991, 5, 97-112.
Douglass North and Barry Weingast, 1989, "Constitutions and Commitment: Evolution f
Institutions Governing Public Choice, Journal of Economic History, December 803-32.
Avner Greif, Paul Migrom, and Barry Weingast, 1994, "Coordination, Commitment and
Enforcement: The Case of the Merchant Guild," Journal of Political Economy, 102, 4.
August.
Gary Libecap, Contracting for Property Rights, 1989, Cambridge University Press.
Paul David, "Clio and the Economics of QWERTY," American Economic Review, 75
May 1985, 332-37.
S. J. Liebowitz and Stephen Margolis, "The Fable of the Keys," Journal of Law and
Economics, April 1990.
S.J. Liebowitz and Stephen Margolis, "Path Dependence, Lock-in, and History," Journal
of Law, Economics and Organization, 11 April 1995, 205-26.
Supplemental:
Douglass North, Institutions, Institutional Change, and Economic Performance, 1990,
Cambridge University Press.
Robert Barro, Determinants of Economic Growth: A Cross-Country Empirical Study,
MIT Press, 1997.
Peter Rousseau and Richard Sylla, "Financial Systems, Economic Growth, and
Globalization," NBER working paper 8323, 2001.
Gary Libecap, 1978, "Economic Variables and the Development of the Law: The Case of
Western Mineral Rights," Journal of Economic History June, 338-62.
Gary Libecap and Steven Wiggins, "The Influence of Private Contractual Failure on
Regulation: The Case of Oil Field Unitization," Journal of Political Economy, August,
1985.

Class Schedule:

Week 1:Atack and Passell, Chapter 1.
Paul Romer, "Why Indeed, in America? Theory, History, and ...Economic Growth,"
American Economic Review, May 1996, 202-6 .

Week 2:David Galenson, "The Settlement and Growth of the Colonies: Population, Labor, and Economic Development," in Stanley Engerman and Robert Gallman, eds, The Cambridge Economic History of the United States, vol. I, 135-207.
Robert E. Gallman, "Economic Growth and Structural Change in the Long Nineteenth
Century," in Stanley Engerman and Robert Gallman, eds, The Cambridge Economic
History of the United States, vol. II, 1-56.
Robert E. Gallman, "Gross National Product in the United States, 1834-1909," in Output,
Employment, and Productivity in the United States after 1800, Studies in Income and
Wealth, Vol. 30, 1966, 3-76.
Moses Abramovitz and Paul David, "American Macroeconomic Growth in the Era of
Knowledge-Based Progress: The Long Run Perspective," in Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, vol. 3,
2000, 1-92.

Week 3:Simon Kuznets, March 1955, "Economic Growth and Economic Inequality," American Economic Review, 1-28.
Klaus Deininger and Lyn Squire, "A New Data Set Measuring Income Inequality," The
World Bank Economic Review, 10 (3), 565-91.
Claudia Goldin and Robert Margo, 1992, "The Great Compression: The Wage Structure
in the US at MidCentury," Quarterly Journal of Economics, 107 (1): 1-34.
Clayne Pope, "Inequality in the Nineteenth Century," in Stanley Engerman and Robert
Gallman, eds, The Cambridge Economic History of the United States, vol. II, 109-42.
Robert Plotnick, Eugene Smolensky, Eirik Evenhouse, and Siobhan Reilly, "The
Twentieth-Century Record of Inequality and Poverty in the United States," in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, Vol. 3, 2000, 249-300.

Week 4:Thomas Piketty and Emmanuel Saez, "Income Inequality in the United States, 1913- 1998," working paper, Harvard University, April 2001
Jeffrey Williamson and Peter Lindert, "Does Globalization Make the World More
Unequal?" April 2001 NBER working paper 8228
Angus Maddison, 1983, "A Comparison of Levels of GDP Per Capita in Developed and
Developing Countries, 1700-1980, Journal of Economic History, March, 27-41.
William Baumol, "Productivity Growth, Convergence, and Welfare: What the Long-Run
Data Show," American Economic Review, December 1986, 1072-85.

Week5:Robert Barro, 1991. "Economic Growth in a Cross Section of Countries." Quarterly Journal of Economics 106, 2 (May): 407-433.
Robert Barro, "Inequality and Growth in a Panel of Countries," Harvard Economics
Department Working paper, 1999.
Robert Barrow, "Inequality, Growth, and Investment, NBER Working Paper 7038.

Week5,6:Jared M. Diamond, 1997, Guns, Germs, and Steel: The Fate of Human Societies, WW.

Week 7:Kenneth Sokoloff and Stanley L. Engerman, "History Lessons: Institutions, Factor Endowments, and Paths of Development in the New World," Journal of Economic Perspectives, 14 (3), Summer 2000, 217-232.
Stanley Engerman and Kenneth Sokoloff, "Factor Endowments, Institutions, and
Differential Paths of Growth Among New World Economies: A View from Economic
Historians of the United States," in Stephen Haber, ed., How Latin America Fell Behind,
1997, Stanford University Press, 260-304.
Daron Acemoglu and James Robinson, "The Colonial Origins of Comparative
Development: An Empirical Investigation," American Economic Review, forthcoming.
Lee Alston, Gary Libecap, and Robert Schneider, "The Determinants and Impact of
Property Rights: Land Titles on the Brazilian Frontier," Journal of Law, Economics and
Organization, 1996.

Week8:Daron Acemoglu, Simon Johnson, and James A. Robinson, "Reversal of Fortune: Geography and Institutions in the Making of the Modern World Income Distribution," working paper, MIT, July 5, 2001.
Sachs, Jeffrey D., 2001, "Tropical Underdevelopment," NBER Working Paper, 8119.
Gavin Wright, "Resource-Based Growth Then and Now," working paper, Stanford
University, June 2001.
Atack and Passell, Chapters 9, 15
Gavin Wright, "The Origins of American Industrial Success, 1879-1940," American
Economic Review, September 1990, p. 651-68.

Week 9:Atack and Passell, Chapters 8, 19.
Joshua Rosenbloom, 1990, "One Market or Many? Labor Market Integration in the Late
Nineteenth Century United States," Journal of Economic History, March 85-107.
Robert Margo, "The Labor Force in the Nineteenth Century," Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, vol. II, 207-
244.
Claudia Goldin, "Labor Markets in the Twentieth Century," in Stanley Engerman and
Robert Gallman, eds, The Cambridge Economic History of the United States, Vol. 3,
2000, 549-624.
Kevin Murphy, Andrei Shleifer, and Robert Vishny, "The Allocation of Talent:
Implications for Growth," Quarterly Journal of Economics, May 1991.

Week 10:Claudia Goldin, "America's Graduation from High School: The Evolution and Spread of Secondary Schooling in the Twentieth Century," Journal of Economic History, June 1998, 345-374.
Robert Fogel, "Nutrition and the Decline in Mortality since 1700: Some Preliminary
Findings," in Stanley Engerman and Robert Gallman, eds, 1986, Long Term Factors in
American Economic Growth, Vol 51, 439-555.
Michael R. Haines, "The Population of the United States, 1790-1920," in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, vol. II, 143-206.
Richard Easterlin, "Twentieth-Century American Population Growth, in Stanley
Engerman and Robert Gallman, eds, The Cambridge Economic History of the United
States, Vol. 3, 2000, 505-549.

Week 11:Atack and Passell, Chapter 6, 7, 16, 17.
Jeremy Atack, 1986, "Firm Size and Industrial Structure in the United States in the
Nineteenth Century," Journal of Economic History June 463-75.
Gary Libecap, 1992, "The Rise of the Chicago Packers and the Origins of Meat
Inspection and Antitrust,' Economic Inquiry, 242-62.
Sukko Kim, 1995, "Expansion of Markets and the Geographic Distribution of Economic
Activities: The Trends in US Regional Manufacturing Structure, 1860-1987," Quarterly
Journal Economics.

Week 12:Atack and Passell, Chapters 8, 10.
Kenneth Sokoloff, "Inventive Activity in Early Industrial American," Journal of
Economic History, 48, December 1988, 813-50.
Stanley Engerman and Kenneth Sokoloff, "Technology and Industrialization, 1790-
1914," in Stanley Engerman and Robert Gallman, eds, The Cambridge Economic History
of the United States, vol. II, 367-402.
David Mowery and Nathan Rosenberg, "Twentieth Century Technological Change," in
Stanley Engerman and Robert Gallman, eds, The Cambridge Economic History of the
United States, Vol. 3, 2000, 803-926.
Romer, Paul, 1990, "Endogenous Technical Change," Journal of Political Economy, 98,
S71-S102.
Josh Lerner, "150 Years of Patent Protection."" (Harvard Business School Working
Paper #00-039 and National Bureau of Economic Research Working Paper No. 7477),
2000.

Week 13:Robert Barro, "Technological Diffusion, Convergence, and Growth," NBER working paper, 5151, 1995.
Week 14: Atack and Passell, Chapter 23.
The US Constitution.
Douglass North, "Institutions," Journal of Economic Perspectives, 1991, 5, 97-112.
Douglass North and Barry Weingast, 1989, "Constitutions and Commitment: Evolution f
Institutions Governing Public Choice, Journal of Economic History, December 803-32.
Avner Greif, Paul Migrom, and Barry Weingast, 1994, "Coordination, Commitment and
Enforcement: The Case of the Merchant Guild," Journal of Political Economy, 102, 4.
August.

Week 15:Gary Libecap, Contracting for Property Rights, 1989, Cambridge University Press.
Paul David, "Clio and the Economics of QWERTY," American Economic Review, 75
May 1985, 332-37.
S. J. Liebowitz and Stephen Margolis, "The Fable of the Keys," Journal of Law and
Economics, April 1990.
S.J. Liebowitz and Stephen Margolis, "Path Dependence, Lock-in, and History," Journal
of Law, Economics and Organization, 11 April 1995, 205-26.