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ORourkeK world econ
EC 4020. The World Economy
Kevin H. O'Rourke
Office hours: W: 10-11 and F: 12-1
Globalization is possibly the most overused word in contemporary social science, but it is far from being a new phenomenon; nor is globalization irreversible. This course provides an introduction to the history of the international economy over the past two centuries, and asks: What were the political and technological underpinnings of increased trade, capital and labour flows during the period; what were the effects of these flows on income distribution within countries; and what political responses did they provoke? What can explain the deglobalization experienced in the years between 1914 and 1945? What, if any, were the connections between globalization and convergence? Between globalization and growth?
Rules of the game
Mobile phones should be switched off in class. The final grade will be based on a term paper of 20 pages (20%), and a final examination (80%). The term paper should identify an original research topic arising from your reading during the course. A one page outline of the paper should be submitted by the end of the first week of Hilary term; the paper itself should be submitted by the end of Hilary term. Late papers will incur a penalty of 10% per day that they are overdue. Students are responsible for everything we cover in class. My strategy for ensuring that you cover the entire course will be to set individual exam questions which cover topics from more than one part of the syllabus.
The main reading for the course is K.H. O'Rourke and J.G. Williamson, Globalization and History: The Evolution of a 19th Century Atlantic Economy (MIT Press, 1999); henceforth, Globalization and History. This is now available in paperback. My recent papers are available on my website.
AER: American Economic Review
BER: Bulletin of Economic Research
BHR: Business History Review
CEPR: Centre for Economic Policy Research Discussion Paper.
EEH: Explorations in Economic History
EER: European Economic Review
EHR: Economic History Review
EREH: European Review of Economic History
HIER: Harvard Institute of Economic Research Discussion Paper
IER: International Economic Review
IO: International Organization
JDE: Journal of Development Economics
JEH: Journal of Economic History
JEL: Journal of Economic Literature
JEP: Journal of Economic Perspectives
JIE: Journal of International Economics
JME: Journal of Monetary Economics
JPE: Journal of Political Economy.
Mass Migration: T.J. Hatton and J.G. Williamson , The Age of Mass Migration: Causes and Economic Impact (Oxford).
NBER: National Bureau of Economic Research Working Paper
PDR: Population and Development Review.
RES: Review of Economics and Statistics
Lecture topics and reading list
Required readings are indicated with an (*); recommended readings with a (#). A longer reading list covering many of the topics is available on request.
Globalization and History, Chapters 1, 2. (*)
2. When did globalization begin?
Ronald Findlay and Kevin O'Rourke , "World commodity market integration, 1500-2000."
O'Rourke, K.H. and J.G. Williamson , "When did globalization begin?," NBER 7632 (April). (#)
O'Rourke, K.H. and J.G. Williamson ,"After Columbus: explaining the global trade boom 1500-1800," NBER 8186 (February) (with Jeffrey G. Williamson).
3. The slave trade and the Industrial Revolution
Findlay, R. , "Trade and Growth in the Industrial Revolution," in C.P. Kindleberger and G. Di Tella (eds.), Economics in the Long View: Essays in Honor of W.W. Rostow (Macmillan). (#)
Findlay, R. , "The 'Triangular Trade' and the Atlantic Economy of the Eighteenth Century: A Simple General-Equilibrium Model," Essays in International Finance 177, International Finance Section, Department of Economics, Princeton University. (#)
Fogel, R. , Without Consent or Contract: The Rise and Fall of American Slavery (Norton), Chapters 1, 7.
Mokyr, J. , "Demand Vs. Supply in the Industrial Revolution," JEH 37(4): 981-1008.
Mokyr, J. , "Editor's Introduction: The New Economic History and the Industrial Revolution," in J. Mokyr (ed.), The British Industrial Revolution: An Economic Perspective (Westview): 1-131, esp. 59-78.
O'Brien, P.K. , "European Economic Development: The Contribution of the Periphery," EHR XXXV(1): 1-18. (#)
O'Brien, P.K. and S.L. Engerman , "Exports and the Growth of the British Economy from the Glorious Revolution to the Peace of Amiens," in B.L. Solow (ed.), Slavery and the Rise of the Atlantic System (Cambridge): 177-209.
Solow, B.L. , "Capitalism and Slavery in the Exceedingly Long Run," in B.L. Solow and S.L. Engerman (eds.), British Capitalism and Caribbean Slavery: The Legacy of Eric Williams (Cambridge University Press): 51-77. (*)
Thomas, R.P. and D.N. McCloskey , "Overseas Trade and Empire 1700-1860," in R. Floud and D.N. McCloskey (eds.), The Economic History of Britain since 1700, Volume 1 (Cambridge): 87-102.
4. 19th century globalization: introduction
Bairoch, P. , "European Trade Policy, 1815-1914," in The Cambridge Economic History of Europe, vol. III, ed. by P. Mathias and S. Pollard (Cambridge: Cambridge University Press).
Baldwin, R.E. , "The Political Economy of Trade Policy: Integrating the Perspectives of Economists and Political Scientists," in R. Feenstra et al. (eds.), The Political Economy of Trade Policy (MIT Press). (#)
Crouzet, F. , "Wars, Blockade, and Economic Change in Europe, 1792-1815," JEH XXIV: 567-588. (#)
Frankel, J.A. , "The 1808-1809 Embargo against Great Britain," JEH XLII: 291-307.
Globalization and History, Chapter 3. (*)
Kindleberger, C. P. , "The Rise of Free Trade in Western Europe, 1820-1875," JEH 35: 20-55.
McKeown, T. J. , "Hegemonic Stability Theory and 19th Century Tariff Levels in Europe," IO 37: 73-91.
North, D. C. , "Ocean Freight Rates and Economic Development 1750-1913," JEH 18: 538-55.
5. The political economy of trade policy: Britain's move to free trade
Globalization and History, Chapter 5. (*)
Irwin, D. A. , "Political Economy and Peels's Repeal of the Corn Laws," Economics and Politics 1: 41-59. (#)
McKeown, T.J. , "The Politics of Corn Law Repeal and Theories of Commercial Policy," British Journal of Political Science 19: 353-380.
Schonhardt-Bailey, C. , "Specific Factors, Capital Markets, Portfolio Diversification, and Free Trade: Domestic Determinants of the Repeal of the Corn Laws," World Politics 43: 545-69. (#)
Williamson, J.G. , "The Impact of the Corn Laws Just Prior to Repeal," EEH 27: 123-156.
6. Repeal and the long run effects of the Irish Famine
Ó Gráda, C. , Ireland: A New Economic Histoy 1780-1939 (Oxford), Chapters 8-11. (#)
Ó Gráda, C. and K.H. O'Rourke , "Migration as Disaster Relief: Lessons from the Great Irish Famine," EREH 1: 3-25. (*)
O'Rourke, K.H. , "Did the Great Irish Famine Matter?," JEH 51: 1-22. (#)
O'Rourke, K.H. , "The Repeal of the Corn Laws and Irish Emigration," EEH 31: 120-38.
O'Rourke, K.H. , "The Economic Impact of the Famine in the Short and Long Run," AER 84: 309-13.
7. Were Heckscher and Ohlin right?
Flam, H., and M. J. Flanders , Heckscher-Ohlin Trade Theory (Cambridge, Mass.: MIT Press).
Globalization and History, Chapter 4. (*)
O'Rourke, K. H., A. M. Taylor, and J. G. Williamson , "Factor Price Convergence in the Late Nineteenth Century," IER 37: 499-530.
O'Rourke, K. H. and J. G. Williamson , "Late 19th Century Anglo-American Factor Price Convergence: Were Heckscher and Ohlin Right?" JEH 54: 892-916.
8. The political economy of trade policy: late 19th century European protectionism
Globalization and History Chapter 6. (*)
Gourevitch, P. , "International Trade, Domestic Coalitions and Liberty: Comparative Responses to the Crisis of 1873-1896," Journal of Interdisciplinary History VIII: 281-313.
Kindleberger, C. P. , "Group Behavior and International Trade," JPE 59: 30-46. (#)
O'Rourke, K.H. , "The European Grain Invasion, 1870-1913," JEH 57: 775-801. (#)
Rogowski, R. , Commerce and Coalitions: How Trade Effects Domestic Political Arrangements (Princeton University Press), Chapters 1,2. (*)
9. Mass migrations: why they moved
Globalization and History, Chapter 7. (*)
Hatton, T. J. and J. G. Williamson , "After the Famine: Emigration from Ireland 1850-1913," JEH 53: 575-600.
Hatton, T. J. and J. G. Williamson , "What Drove the Mass Migrations from Europe in the Late Nineteenth Century?" PDR 20: 1-27. (#)
Mass Migration, Chapters 1-5. (#)
10. Mass migrations: consequences
Boyer, G. R., T. J. Hatton, and K. H. O'Rourke , "Emigration and Economic Growth in Ireland, 1850-1914," in Migration and the International Labor Market, 1850-1939, edited by T. J. Hatton and J. G. Williamson (London: Routledge).
Globalization and History, Chapter 8. (*)
Mass Migration, Chapters 7-9. (#)
Mokyr, J. and C. Ó Gráda , "Emigration and Poverty in Pre-Famine Ireland," EEH 19: 360-384.
11. Global capital market integration in the 19th and 20th centuries
Bordo, M.D., B. Eichengreen and J. Kim , "Was There Really an Earlier Period of International Financial Integration Comparable to Today?", NBER 6738 (September). (#)
Bordo, M.D. and H. Rockoff , "The Gold Standard as a 'Good Housekeeping Seal of Approval' ", JEH 56: 389-428. (#)
Globalization and History, Chapter 11. (*)
Jones, G. , The Evolution of International Business: An Introduction (London: Routledge), Chapter 2.
Obstfeld, M. and A. M. Taylor , "The Great Depression as a Watershed: International Capital Mobility in the Long Run," in The Defining Moment: The Great Depression and the American Economy in the Twentieth Century, edited by M. Bordo, C. Goldin and E. White (Chicago: University of Chicago Press).
12. International capital flows in the 19th century: causes and consequences
Clark, G. (1987), "Why Isn't the Whole World Developed? Lessons from the Cotton Mills," JEH XLVII: 141-73. (#)
Globalization and History, Chapter 12. (*)
Lucas, R. E. , "Why Doesn't Capital Flow from Rich to Poor Countries?" AER 80: 92-6.
Pollard, S. , "Capital Exports, 1870-1914: Harmful or Beneficial?," EHR 38: 489-514.
Taylor, A. M., and J. G. Williamson , "Capital Flows to the New World as an Intergenerational Transfer," JPE 102: 348-71.
13. Globalization backlash and World War I
Feinstein, C.H., P. Temin and G. Toniolo , The European Economy Between the Wars (Oxford University Press), Chapters 1, 2. (#)
Globalization and History, Chapters 9, 10. (*)
Goldin, C. , "The Political Economy of Immigration Restriction in the United States, 1890 to 1921," in C. Goldin and G. D. Libecap (eds.), The Regulated Economy: A Historical Approach to Political Economy (Chicago: University of Chicago Press).
14. Interwar capital markets: debt and default
Eichengreen, B. and R. Portes , "Debt and Default in the 1930s: Causes and Consequences," EER 30: 565-589. (*)
Lindert, P.H. and P.J. Morton , "How Sovereign Debt has Worked,", in J. Sachs (ed.), Developing Country Debt and the World Economy (University of Chicago Press). (*)
Özler, . , "Have Commercial Banks Ignored History?" AER 83: 608-620. (#)
Taylor, A. M. , "External Dependence, Demographic Burdens, and Argentine Economic Decline After the Belle Epoque," JEH 52: 907-36.
Taylor, A.M. , "Argentina and the World Capital Market: Saving, Investment, and International Capital Mobility in the Twentieth Century," JDE 57: 147-184.
15. The legacy of the Great Depression in the 3rd world
Corbo, V. , "Development Strategies and Policies in Latin America: A Historical Perspective," International Center for Economic Growth, Occasional Paper no. 22 (April).
Diaz Alejandro, C. , "Latin America in the 1930s," in Thorp, R. (ed.), Latin America in the 1930s: The Role of the Periphery in World Crisis (Macmillan): 17-49. (*)
Krueger, A. , "Trade Policy and Economic Development: How We Learn,"AER 87: 1-22. (*)
Prebisch, R. , "Five Stages in My Thinking on Development," in Meier, G. and D. Seers (eds.), Pioneers in Development (Oxford University Press): 175-204. (#)
16. Post-1945 globalization and the 'Golden Age' of European growth
Crafts, N.F.R. and G. Toniolo (eds.) , Economic Growth in Europe Since 1945 (Cambridge U.P.), Chapters 1, 2. (*)
De Long, J.B. and B. Eichengreen , "The Marshall Plan: History's Most Successful Structural Adjustment Program," in R. Dornbusch, W. Nölling and R. Layard (eds.), Postwar Economic Reconstruction and Lessons For the East Today (MIT Press). (#)
Eichengreen, B. and M. Uzan , "The Marshall Plan: Economic Effects and Implications for Eastern Europe and the Former USSR," Economic Policy 14: 14-75.
Irwin, D.A. , "The GATT's Contribution to Economic recovery in Post-war Western Europe," in B. Eichengreen (ed.), Europe's Post-war Recovery (Cambridge University Press). (#)
17. The East Asian miracle and the East Asian crisis
The best single source is Nouriel Roubini's webpage on the Asian crisis:
Krugman, P. , "The Myth of Asia's Miracle," Foreign Affairs, 62-78. Available at http://web.mit.edu/krugman/www/myth.html.
Krugman, P. , "What happened to Asia?", http://web.mit.edu/krugman/www/DISINTER.html
18. Globalization and inequality
Kevin O'Rourke (2001), "Globalization and inequality: historical trends," NBER 8339 (June). (*)
Globalization and History, Chapter 14.
Sachs, J. D. and A. Warner , "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, I (Washington, D.C.: Brookings Institution). (#)
19. Explaining attitudes towards globalization
Kevin O'Rourke and Richard Sinnott (2001), "What determines attitudes towards protection? Some cross-country evidence," forthcoming, Brookings Trade Policy Forum. (*) Available online.