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Armies of Deliverance: A New History of the Civil War

Author(s):Varon, Elizabeth R.
Reviewer(s):Farrell, Daniel

Published by EH.Net (June 2022).

Elizabeth R. Varon. Armies of Deliverance: A New History of the Civil War (College Edition). Oxford: Oxford University Press, 2020. xxiii + 531 pp. $35 (paperback), ISBN: 978-0199335398.

Reviewed by Daniel Farrell, Department of History, University of Cincinnati.


Throughout the decades, there has been no shortage of literature to explain the North’s commitment to fighting the Civil War. Elizabeth R. Varon enters this continuously growing field with a single-volume history, Armies of Deliverance, that promises fresh interpretations of the subject. Varon forcefully argues that Abraham Lincoln’s administration successfully built its prowar collation around the idea of deliverance. Within this worldview, Northerners (broadly constructed) argued that Southerners were loyalists at heart, tricked into rebellion, and suffered under an oppressive and tyrannical Confederate government. However, as Varon argues, different constituencies modified their rhetoric to satisfy diverse political needs. While moderate and Radical Republicans differed on the moral question of slavery, both increasingly stressed that emancipation would liberate white Southerners from the slaveholding oligarchy that plunged the nation into war. Conservative prowar Democrats, however, faced the unique problem of presenting a loyal opposition to Lincoln’s administration while simultaneously committing themselves to an uncompromised victory over the Confederacy. To navigate this problem, Democrats stressed that “the key to reunion was rekindling the allegiance of conservative white Southerners by disabusing them of the false notion that the Union was controlled by anti-slavery extremists” (9).

To be sure, Varon’s book wades into longstanding debates. Scholars such as James Oakes and Chandra Manning have emphasized emancipation and black liberation as the driving motivation for the North. Others such as Gary Gallagher and Ian Smith have emphasized saving the Union as the North’s primary goal. Varon finds this dichotomy unsatisfying, arguing it fails to explain how politically diverse Northerners found common ground while simultaneously remaining sharply divided over the war’s meaning. Thus, the politics of deliverance forges a unifying principle for understanding the war, particularly since, according to the author, it existed at the outset and grew in strength over time. Given the fraught nature of partisan politics, deliverance helped ease “tensions within the Union over war aims” (2), allowing the conflict to have a common interpretation to restore Southerners to the blessings and liberties of the United States. Throughout the book, Varon demonstrates the importance of deliverance rhetoric, documenting its continuous use throughout the war.

The book’s structure closely mirrors the Union’s war effort, meaning that Northern political, social, and military events drive the narrative. Such an approach lends itself well to developing the book’s central arguments. Thus, like most works of the Civil War, emancipation takes center stage and is the major turning point of the war. While historians may continue to debate whether the Emancipation Proclamation was strictly a military measure, a genuine reflection of Lincoln’s abolitionist leanings, or something in between, it is undeniable that emancipation fundamentally changed the political nature of the North’s war effort. Here Varon’s argument begins to fracture along partisan lines. Varon makes a convincing case that deliverance was important to Republican rhetoric, but it’s less clear how meaningful it was for the War Democrats. Rather than explaining how Democrats kept faith in the war, Varon instead brings a wealth of information demonstrating how the Peace (Copperhead) wing of the Democratic Party split the organization, especially over their two primary complaints: emancipation and the abuses of civil liberties (which were aimed exclusively against conservative Democrats). Varon’s emphasis on Copperheads raises the question of whether deliverance truly bridged the political divide. Alternative explanations include that War Democrats compromised their principles and acceded to Republican policy goals for the greater service of saving the nation rather than sustaining their confidence in the politics of deliverance. Similarly, Varon acknowledges that some Democrats, particularly soldiers, became disgusted by Copperheads, whom they viewed (aided by Republican propaganda) as essentially traitorous. For many Democrats and conservatives, voting for the Republican ticket was perhaps an act of patriotism rather than a genuine commitment to deliverance.

The book’s structure is less effective in demonstrating Varon’s sub-argument, contending that discourses over “deliverance” similarly provide “a new perspective on Confederate politics” (15). In essence, the Confederacy sought deliverance from abolitionist influences that planters and Southern intellectuals saw as destabilizing their social order. The Confederacy also attempted to “liberate” the Border South, contending that Southern loyalists chaffed under military despotism. Varon explores these themes sporadically, but her Northern emphasis greatly overshadows her contributions to Confederate historiography. Likewise, given that EH.Net caters to economic historians, readers may be curious to know how Varon’s book relates to economic history. While economic issues are mentioned occasionally throughout the text, Armies of Deliverance is not an economic history of the Civil War, nor does it claim to be one.

Regardless of criticism, Varon has successfully written an engaging and thought-provoking new history of the Civil War. Scholars seeking to challenge or expand our understanding of Northern war motivations will be required to engage with Varon’s deliverance argument, as she deftly demonstrates its importance to the rhetoric of unconditional unionism.  Similarly, it is worth noting that Armies of Deliverance doubles as a college textbook. Given its engaging narrative and easily digestible and well-supported central thesis, Armies of Deliverance is a worthy choice for an upper-level college course and one that this reviewer would seriously consider using himself. Varon’s work is an excellent addition to the literature and deserves a spot in anyone’s Civil War library.


Daniel Farrell is a Ph.D. candidate in history at the University of Cincinnati, where his research focuses on the culture of pro-war unionism and efforts to suppress anti-war dissent in the Civil War Era North. He is the author of “‘The Nation Cannot Now Be Entrusted to Hands Reeking with the Blood of Loyal Victims’: Prison Propaganda, Hard War, and the Politics of Criminalization,” published in Lorien Foote and Daniel Krebs, eds., Useful Captives: The Role of POWs in American Military Conflicts (University Press of Kansas, 2021).

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (June 2022). All EH.Net reviews are archived at


Subject(s):Government, Law and Regulation, Public Finance
Servitude and Slavery
Military and War
Geographic Area(s):North America
Time Period(s):19th Century

After Redlining: The Urban Reinvestment Movement in the Era of Financial Deregulation

Author(s):Marchiel, Rebecca K.
Reviewer(s):Storrs, Thomas

Published by EH.Net (June 2022).

Rebecca K. Marchiel. After Redlining: The Urban Reinvestment Movement in the Era of Financial Deregulation. Chicago: The University of Chicago Press, 2020. viii + 296 pp. $50 (cloth), ISBN 978-0226723648.

Reviewed for EH.Net by Thomas Storrs, Corcoran Department of History, University of Virginia.


The term “redlining” refers to a financial institution’s refusal to service an area with loans or insurance due to some combination of the race, ethnicity, and wealth of its residents. The term entered the lexicon around 1970. Rebecca Marchiel’s excellent and groundbreaking first book After Redlining: The Urban Reinvestment Movement in the Era of Financial Deregulation highlights reasons for its emergence and the activists who fought for its end. This fascinating volume will be of interest to historians of finance, cities, and social movements. In brief, most existing scholarship on racial discrimination in home mortgages in the twentieth century, beginning with Kenneth Jackson’s Crabgrass Frontier in 1985 and stretching across many academic disciplines today, focuses on denial of credit to Black communities before 1970, as contrasted with the suburban white communities that received federal mortgage insurance and guarantees in the middle third of the twentieth century. Marchiel, an Associate Professor of History at the University of Mississippi, flips this script by focusing on interracial urban communities “FHAed,” a term coined by local activists, and those activists’ evolution into a national campaign for redress.  The book provides essential background for scholars researching intraurban wealth inequality in the twentieth century United States and would be appropriate for an undergraduate course on the late twentieth century US history of social movements, financialization, or cities.

Activists uncovering and fighting redlining serve as Marchiel’s primary actors and narrators. Gale Cincotta, formerly a stay-at-home mother of six boys, and Shel Trapp, a professional organizer, founded National People’s Action (NPA). NPA learned and grew from their Chicago base to become a national movement that secured passage of both the Home Mortgage Disclosure Act (HMDA) of 1975, requiring financial institutions to disclose their home mortgage lending, and the Community Reinvestment Act (CRA) of 1977 that formed the centerpiece of efforts to funnel mortgage dollars to underserved communities. HMDA and CRA constituted the high-water mark of NPA’s legislative efforts. The group then turned to bank-based reinvestment in the late 1970s and early 1980s where financial institutions, among them commercial banks, savings and loans, and life insurance companies, agreed to lend specific sums in inner-city neighborhoods. Despite high hopes and heady headlines, Marchiel explains that this phase “did nothing to shrink the racial wealth gap, nor did it provide economic security for low-income people.” (15) These piecemeal efforts did serve the lenders’ interests by staving off additional legislation. The Clinton Administration revived the CRA as the toll for commercial bank consolidation in the 1990s. These two pieces of legislation, Marchiel argues, marked the end of New Deal Liberalism and the dawn of a neoliberal deregulation that snuffed out community-based lending.

But back to the beginning of the story. The Federal Housing Administration’s Section 235 program, part of the 1968 Housing and Urban Development Act, fully insured lenders against loss on loans to poor borrowers in inner-city neighborhoods. The program was a disaster for everyone involved except for the rapacious lenders who milked the program into disgrace by repeatedly lending money with little or no money down on shoddy homes that bribed FHA inspectors certified as sound. These inflated appraisals saddled borrowers with unaffordable debts while disequilibrating prices. The federal government and borrowers lost their shirts while conventional lenders refused to lend in areas eligible for FHA Section 235 loans, i.e., neighborhoods that had been “FHAed.” This practice, not the earlier efforts of the FHA since its inception in 1934 to augment affluent, white suburbia, marked the genesis of redlining activism.

For urban history historiography, this intervention, alongside Keeanga Yahmatta Taylor’s complementary 2019 book Race for Profit: How Banks and the Real Estate Industry Undermined Black Homeownership, shifts focus from earlier harms done by FHA exclusion to more recent harms done by FHA inclusion. Kenneth Jackson’s Crabgrass Frontier exemplifies the former and sought to explain 1970s urban disinvestment by reaching back to the 1930s Home Owners’ Loan Corporation maps rather than the more proximate, and plausible, explanation of Section 235’s driving conventional lenders out of low-income urban neighborhoods. After Redlining also provides a new chapter to Beryl Satter’s Family Properties: How the Struggle Over Race and Real Estate Transformed Chicago and Urban America (2010), which focuses on earlier private contract lending that deployed similar schemes to evaporate Black wealth. This book also contrasts with Amanda Seligman’s Block by Block: Neighborhoods and Public Policy on Chicago’s West Side (2005), which focuses on the antiblack reactions of white Chicagoans as compared to Marchiel’s highlighting of interracial activism.

For urban economists, sociologists, and geographers, the book suggests a similar reappraisal is in order. The long legacy of New Deal mortgage programs and the fruitful research on them might move on to these questions: What relative role did higher interest rates and the FHA Section 235 program play in conventional home mortgage lenders’ abandonment of transitional urban neighborhoods? Why was the FHA successful in insuring mortgages in white suburbs and subsequently unsuccessful in insuring mortgages in racially mixed urban areas? What was the political economy of lenders’ purportedly voluntary loan commitments in response to activists’ demands and were these efforts a success on either side?

Overall, After Redlining makes a significant contribution to urban history scholarship that will be useful across many fields. Marchiel’s use of NPA’s archives to cogently put together a history of activism alongside sophisticated yet intelligible financial history is remarkable and innovative. As it is de rigeur in book reviews to add a few criticisms, I will follow suit even though none of mine are major. First, the title After Redlining is slightly misleading in that the book in fact covers a major period of redlining spurred by Section 235. This can be chalked up as a reference to preexisting narratives but underplays the book’s contribution. Second, in my reading, the clear “bad guy” here is the FHA in that they caused the destruction of an, up to that point, viable home mortgage market in inner city neighborhoods via Section 235. I think it bears emphasis that there was a viable conventional mortgage market during the FHA’s prior period of neglecting these areas and that the FHA’s Section 235 program killed it with an assist from erratic and rising mortgage rates. The Censuses of Housing across this period agree that savings and loans lent throughout the early postwar period to Black borrowers. Marchiel presents all the dots for these two conclusions but does not quite connect them. Lastly, I do not see evidence of “a two-way relationship with thrifts that activists came to expect under the New Deal financial regime.” (83) Thrifts, namely savings and loans, lent in urban areas and/or to nonwhite borrowers because the FHA did not. They sought to maximize the risk-adjusted returns of their savers rather than practice New Deal mutuality. Concomitantly, they stopped making conventional loans for the same areas and borrowers because they deemed the profit not worth the risk.

These required and slight criticisms aside, After Redlining should be on your reading list. I enjoyed it. Marchiel’s arguments and evidence answered many questions I had while fostering new ones. The 1970s are a treacherous canyon for any historian to cross. This book bridges them elegantly and innovatively with fresh evidence and novel arguments.


Thomas Storrs is a PhD student in the Corcoran Department of History at the University of Virginia, where he studies urban and financial history. His article with Price Fishback, Jonathan Rose, and Kenneth Snowden, “New Evidence on Redlining by Federal Housing Programs in the 1930s,” is forthcoming in the Journal of Urban Economics.

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (June 2022). All EH.Net reviews are archived at


Subject(s):Economic Planning and Policy
Financial Markets, Financial Institutions, and Monetary History
Government, Law and Regulation, Public Finance
Social and Cultural History, including Race, Ethnicity and Gender
Urban and Regional History
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

The Marginal Revolutionaries: How Austrian Economists Fought the War of Ideas

Author(s):Wasserman, Janek
Reviewer(s):Goodman, Nathan P.

Published by EH.Net (May 2022).

Janek Wasserman. The Marginal Revolutionaries: How Austrian Economists Fought the War of Ideas. New Haven and London: Yale University Press, 2019. xii + 354 pp. $35 (hardcover), ISBN 978-0-300-22822-9.

Reviewed for EH.Net by Nathan P. Goodman, Department of Economics, New York University.


Economists are social scientists, but we’re also human beings. We have families and friends. We learn and work in professional networks. We strive to influence the world around us. Some work in the history of economic thought focuses on economic ideas alone, offering a narrowly doctrinal history of our discipline. In The Marginal Revolutionaries, Janek Wasserman discusses not merely the ideas of Austrian school economists, but also their lives and relationships. The result is a rich and engaging history of the Austrian school of economics.

Austrian economists made vital contributions to economic theory, especially in relation to marginalism, subjectivism, opportunity cost, entrepreneurship, and spontaneous order. This book offers a history of how they made these contributions. Wasserman deftly weaves together both history of economic thought and engaging description of the social, political, and cultural context. This is especially compelling during the earlier chapters, which discuss how Austrian economics developed in Vienna.

At its height, Vienna was an incredible center of intellectual activity. The Austrian economists were a very important part of this intellectual culture, but they also interacted with other intellectual circles in Vienna. These included the logical positivists, famed psychologists such Sigmund Freud, and influential Marxists and socialists including Rudolf Hilferding, Otto Bauer, and Nikolai Bukharin. On the one hand, these types of interactions illustrate just how intellectually vibrant Vienna was. They also illustrate the crucial role that contestation and debate played in the development of Austrian economics. Austrian economists did not merely argue among themselves, they argued with other intellectuals who passionately disagreed with them. These disagreements were especially sharp in their debates with Marxists on questions such as the transformation problem, exploitation, the feasibility of rational economic calculation under socialism, and the relationship between capitalism and imperialism. Given my interest in defense economics, I found the discussion of their debates over imperialism especially fascinating.

But social science does not merely depend on arguments. The efforts of intellectual entrepreneurs who start seminars, colloquia, academic journals, research centers, professional organizations, and learned societies are just as crucial. Carl Menger founded the Austrian school, but Wasserman argues that the school formed a cohesive identity largely due to intellectual entrepreneurship by two scholars that Menger inspired: Eugen von Böhm-Bawerk and Friedrich von Wieser. By creating a professional association, the Gesellschaft Österreichischer Volkswirthe (Society of Austrian Economists, GÖV), and a corresponding journal, Die Zeitschrift für Volkswirtschaft, Socialpolitik und Verwaltung, they established forums for discussion of Austrian ideas. Throughout this period, they forged a vibrant community of Austrian scholars, including some I had not previously been familiar with, such as Emil Sax.

Later generations of Austrian economists continued to act as intellectual entrepreneurs. Throughout their time in Austria, they continued to establish discussion groups as well as more formal research centers such as the Institute for Business Cycle Research. During World War II, most of the Austrian economists fled from the Nazis. This emigration created an additional need for intellectual entrepreneurship. To help their friends and colleagues find refuge and secure employment outside of Austria, members of the Austrian school forged new relationships and drew on existing relationships with academics and donors. Once they had successfully fled, they engaged in intellectual entrepreneurship to make space for their work. The institutions they relied on in Austria had been destroyed, and they needed to forge new paths.

This took a variety of forms. Some, such as Ludwig von Mises’s seminar in New York and Friedrich Hayek’s role in founding the Mont Pelerin Society, were stories I knew well. Others, such as Gottfried Haberler’s influence on trade policy or Oskar Morgenstern’s influence within the American military-industrial complex, were new to me. Some of these lesser known paths illustrate the nuances of Austrian influence on global politics. The influence of Mises, Hayek, and Murray Rothbard on libertarian and free market political movements is well known. But Austrian influence within more technocratic circles is less widely known, and this book helped me better understand the diverse ways that Austrian economists influenced policy, both in Vienna and after their emigration.

While Wasserman spends a lot of time discussing how Austrian economists influenced politics, he also avoids a common pitfall that can occur in such discussions. Too often, people insinuate that Austrian economics is solely an ideological or political project. Wasserman makes sure to discuss Austrians’ technical scientific and methodological contributions, which are the true core of Austrian economics. While he discusses political activism by Austrian school economists, he also discusses deliberate efforts by Austrian economists to maintain the ideal of wertfreiheit, or value freedom. While Austrian economists had political views, many of them were clear about the difference between their prescriptive beliefs and their social scientific descriptions of the world.

Wasserman is a great storyteller. The relationships among Austrian economists are front and center in his account of the Austrian school. This makes the book a fun and engaging read and helps us appreciate the social element of scientific inquiry. If you care about Austrian economics, history of economic thought more generally, the history of 20th century politics, or the sociology of scientific inquiry, then I think you’ll benefit from reading this book.


Nathan P. Goodman is a Postdoctoral Fellow in the Department of Economics at New York University, where he is affiliated with the Program on the Foundations of the Market Economy. His research focuses on political economy, public choice, defense and peace economics, border militarization, and Austrian economics.

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at

Subject(s):History of Economic Thought; Methodology
Geographic Area(s):General, International, or Comparative
North America
Time Period(s):19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Three Days at Camp David: How a Secret Meeting in 1971 Transformed the Global Economy

Author(s):Garten, Jeffrey E.
Reviewer(s):Santos, Joseph M.

Published by EH.Net (May 2022).

Jeffrey E. Garten. Three Days at Camp David: How a Secret Meeting in 1971 Transformed the Global Economy. New York: Harper, 2021. 435 pp. $29.99, ISBN 978-0-06-288767-2 (cloth).

Reviewed for EH.NET by Joseph M. Santos, Professor of Economics, South Dakota State University.


On July 1, 1944, more than 700 delegates, including John Maynard Keynes (British delegation) and Harry Dexter White (U.S delegation), from 44 nations, arrived at the Mount Washington Hotel in Bretton Woods, New Hampshire, to redesign an international monetary system left grossly imbalanced by the ravages of the Second World War. The outcome of the conference and subsequent deliberations was a U.S.-led elaborate plan to reorder the values of foreign exchange and the patterns of international trade, into a new international financial order that would come to be known as the Bretton Woods System (Steil 2013). The system included the newly established International Monetary Fund (IMF) and fixed exchange-rate parities, adjustable with IMF authorization as structural current-account imbalances dictated. In principle, the system afforded foreign-exchange stability—prohibiting competitive, beggar-thy-neighbor devaluations—and independent national monetary policies—reducing the international transmission of business cycles.

Roughly a quarter-century later, on August 13, 1971, President Richard M. Nixon and 15 advisors, including Arthur F. Burns (Chair of the Federal Reserve), John B. Connally (Secretary of the U.S. Treasury), and Paul A. Volcker (Undersecretary of the U.S. Treasury for International Monetary Affairs) arrived at Camp David, the presidential retreat in Catoctin Mountain Park, Maryland, to craft in secret an economic policy to reverse a relatively high rate of inflation, a current-account deficit, a longstanding decline in the U.S. monetary gold stock, and a recent, sharp rise in external dollar liabilities held by central banks. At the meeting’s end, on August 15, 1971, in a televised, Sunday-evening address to the nation, President Nixon announced, as part of his New Economic Policy, “I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold…” (Garten 2021, 231). Temporary proved permanent: by March 1973, the dollar-gold link was decoupled completely; the floating-exchange rate system we know today stood firmly in place, signaling the unambiguous end to the Bretton Woods System.

In Three Days at Camp David, Jeffrey E. Garten, dean emeritus of the Yale School of Management, takes readers inside the presidential retreat on that fateful weekend, when the principals and a handful of staff members crafted the New Economic Policy, a package of wage and price controls, a 10 percent tariff increase, a 10 percent investment tax credit (and spending cuts to render the credit revenue neutral), and, most notably, the closure of the gold window. To Garten, the events of that weekend and the New Economic Policy it shaped reflected a larger shift in the dollar’s role—and, correspondingly, the U.S.’s role—in the world economy. The U.S. would no longer assume and jockey for the mantle of global economic leadership as the nation had done since the Second World War, a course change driven as much by pragmatism as anything else: by the early 1970s, economic challenges at home left little policy space or political appetite to address fragilities inherent in the Bretton Woods System.

This is to say, the demise of Bretton Woods was, in fact, broadly anticipated. The IMF Articles of Agreement had established the fund within the Bretton Woods System to intermediate financial flows across the balances of payments of member nations. Through the IMF, a nation with a temporary current-account deficit could borrow from a nation with a temporary current-account surplus. In this way, a nation that maintained a deficit [surplus] was not required to balance its current account by contracting [expanding] domestic economic activity. Absent this IMF intermediation, at best a contraction in one nation would be met with a corresponding expansion in another; at worst, the nation that maintained a current-account surplus would choose not to expand (over concern for inflation, for example), leading to a contraction of global economic activity. Meanwhile, according to the Articles, a nation could potentially correct a structural, or permanent, current-account imbalance by devaluing or revaluing its exchange rate accordingly. In any case, the Articles did not practically distinguish between temporary and permanent imbalances; nor did they “make clear what should happen when the principal reserve currency country—the United States—ran persistent trade or current account deficits” (Meltzer 2003, 584). Ultimately, these ambiguities would prove too much for the system to bear. It lasted twenty-five years; though current-account convertibility prevailed for only nine years, from 1959-67, when each member nation freely bought or sold foreign exchange to maintain the nation’s exchange-rate parity to the U.S. dollar within one-percentage-point margins; and the U.S. Treasury freely bought or sold gold—through the so-called gold window—to maintain the value of the U.S. dollar at $35 per ounce.

During this convertibility phase, interrelated problems challenged the system: balance-of-payments adjustments relied, to some extent, on the discretionary macroeconomic policies of debtor and creditor nations; meanwhile, either the supply of monetary gold constrained systemwide liquidity or it was supplied by U.S. balance-of-payments deficits, which, if large enough, strained confidence in the system—and, specifically, the U.S.—to maintain convertibility (Bordo 1993, 49-74). The Triffin dilemma implied the “postwar monetary arrangement contained the seeds of its own demise” (Garten 2021, 7). In the latter half of the 1960s, the scarcity of monetary gold and global inflationary pressures spurred by U.S. expansionary monetary policies conspired to compromise the system, which had effectively defaulted to a dollar standard, though threats posed by nations intending to exchange dollar liabilities for U.S. monetary gold loomed. British and French plans to convert their dollars into gold spurred the weekend meeting at Camp David.

Though Garten provides readers a broad overview of the Bretton Woods System and walks them through the events leading to the weekend meeting and its aftermath, the meeting is his primary focus. In a series of chapters Garten groups under the heading, “The Cast,” the author offers insightful and colorful biographies of the major attendees: namely, Richard M. Nixon, John B. Connally, Paul A. Volcker, Arthur F. Burns, George P. Schultz (Director of the Office of Management and Budget), and Peter G. Peterson (Assistant to the President for International Economic Policy). He also briefly introduces “Other Players,” including Paul W. McCracken (Chairman of the Council of Economic Advisors) and, though absent from the weekend meeting, Henry A. Kissinger (National Security Advisor). Then, in a series of chapters Garten groups under the heading “The Weekend,” he artfully weaves these personalities, and the often-tense negotiations between them and the president, into the early sausage making of Nixon’s New Economic Policy. In doing so, Garten offers readers—including monetary economists who imagine themselves well versed in the demise of Bretton Woods—a unique perspective and insight on a pivotal decision in the history of this monetary order.

We learn that John Connally, a ruthless political pragmatist and nationalist whom Nixon respected, believed U.S. allies had long taken advantage of the nation. In his view, international arrangements—the Bretton Woods System or otherwise—constrained U.S. progress. Governed by the self-described preference, “I want to screw the foreigners before they screw us,” Connally was at best indifferent to preserving the Bretton Woods System; moreover, using tariffs to protect domestic production did not offend him (Garten 2021, 77). Paul Volcker was the model career civil servant, a deep-in-the-weeds policy wonk of impeccable integrity who wrote long, dense white papers. He reasoned that the best interests of the U.S. were served by a robust international financial system; and he once described devaluation of the dollar—and, thus, decoupling its value from gold—as “anathema to me,” in part because, in his view, the value of money and, reciprocally, price stability required the anchor that gold provided (Garten 2001, 83). Arthur Burns, an eminent academic economist who served the National Bureau of Economic Research as research director, president, and honorary chairman, mattered to Nixon, if only because dissension from the chair of the Federal Reserve would compromise the message the president sought to convey regarding his New Economic Policy. As Garten tells it, as a monetary policymaker, Burns was at best complicated. He tended to view inflation as a byproduct of imperfectly competitive labor markets; thus, wage and price controls, not monetary contractions, were, in his view, potential instruments of price stability. Moreover, he seemed to cave to Nixon, a president who famously remarked, “When we get through, this Fed won’t be independent if it’s the only thing I do” (Garten 2021, 107).

Meanwhile, George Schultz, who held a PhD in industrial economics from MIT and had served as dean of the University of Chicago Graduate School of Business, was a “fierce conservative partisan,” a monetarist with a deregulatory, free-market mindset (Garten 2021, 112). Schultz favored replacing Bretton Woods with freely floating exchange rates between fiat currencies. Not surprisingly, he vehemently opposed wage and price controls. Finally, Peter Peterson was a free trader who, upon witnessing the seemingly organized world market power Germany and Japan exercised at great cost to the U.S., came to favor U.S. industrial policies that could enhance U.S. productivity with targeted investments in technology, the sort of investments that tax credits might induce, for example.

These and other personalities in the rooms—and cabins—where it happened during those Three Days at Camp David forged, in part, President Nixon’s New Economic Policy of wage and price controls, tariffs, tax credits, and a new monetary order. No doubt, larger international macroeconomic imbalances were in place well before the meeting, a fact Garten rightly acknowledges. Nevertheless, Garten offers a novel and compelling lens through which to view an executive decision that unquestionably hastened the pace of dramatic change in the global international financial order. Additionally, he persuasively argues his larger point that U.S. international macroeconomic policy in the early 1970s reflected a broader, intentional move away from a position of global leadership that the U.S. presumed it had occupied since the Second World War, a move Garten says the U.S. finds itself scrutinizing once again.


Bordo, Michael D. (1993) “The Bretton Woods International Monetary System: A Historical Overview.” In A Retrospective on the Bretton Woods System: Lessons for International Monetary Reform, edited by Michael D. Bordo and Barry Eichengreen, 3-98. Chicago: University of Chicago Press.

Meltzer, Allan H.  (2003) A History of the Federal Reserve, Volume 1: 1913–1951 Chicago: University of Chicago Press.

Steil, Benn. (2013) The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order. Princeton: Princeton University Press.


Joseph M. Santos is Professor of Economics in the Ness School of Management and Economics at South Dakota State University, where he teaches and writes on macroeconomics, banking, and financial markets, and where he directs the Dykhouse Program in Money, Banking, and Regulation.

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at


Subject(s):Economic Planning and Policy
Economywide Country Studies and Comparative History
Financial Markets, Financial Institutions, and Monetary History
International and Domestic Trade and Relations
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

A New Balance of Payments for the United States, 1790–1919: International Movement of Free and Enslaved People, Funds, Goods and Services

Author(s):Officer, Lawrence H.
Reviewer(s):Devereux, John

Published by EH.Net (May 2022).

Lawrence H. Officer. A New Balance of Payments for the United States, 1790–1919: International Movement of Free and Enslaved People, Funds, Goods and Services. New York: Palgrave Studies in American Economic History, Palgrave Macmillan, 2021. xxxiii + 415 pp. $150 (hardcover or paper), ISBN 978-3-030-66098-7.

Reviewed for EH.Net by John Devereux, Department of Economics, Queens College, City University of New York.


This book provides a definitive treatment of the U.S balance of payments from 1790 to 1919. There is rich U.S tradition in this area. The 1960 NBER volume Trends in the American Economy in the Nineteenth Century contained two seminal articles on U.S external transactions. Douglas North covered 1790 to 1840, while Matthew Simon covered 1840 to 1916. Three years later, Robert Lipsey produced his estimates of the U.S external terms of trade after 1879. North went on to win the Nobel Prize in Economics. Lipsey had a distinguished career at the NBER and Queens College. Simon, also of Queens College, died in 1968. For the last 60 years their magisterial work has formed the basis for what we know about U.S. external transactions over the eighteenth and early twentieth centuries.

Much has changed since the early 1960’s. So it is time for a fresh look at historical measures of the U.S balance of payments. Accordingly, Lawrence Officer set out to revise North and Simon. To accomplish this, he gathered the information, published and unpublished, that has appeared over the last six decades. He also revisited earlier sources – including sources missed by North and Simon. It has taken him ten years, but he has accomplished his task in this book.

Officer has two objectives. The first is to put the U.S balance of payments from 1790 to 1919, where the official series begin, on a consistent basis, as previous work joined together series which were often incomplete and which used different approaches and different measures. More importantly, Officer expands coverage and improves the quality of the estimates. It would take a much longer review to even list the improvements in existing series. But the creation of new measures of the U.S net asset position and better measures of service trade are particularly noteworthy. The effort required to accomplish all of this is immense.  Consider the estimates for tourism. This requires 82 series for ocean fares (p. 283). In addition, Officer has to construct a new U.S CPI, and he generates measures of domestic U.S passenger transportation for rail, stagecoaches, etc.

Officer’s thoroughness is shown by the fact that he revisits earlier work by going back to the original sources and correcting errors of transcription, etc. He accomplished all of this, it would appear, working on his own without an army of research assistants. North, Simon, and Lipsey benefitted greatly from the institutional support of the NBER. Alas, the NBER no longer fills this function and Officer works on his own. The resulting book is a model of scholarship – he presents all his results; he outlines his methods and assumptions; he is modest and thoughtful; and he is generous in his praise of earlier work. Indeed, he dedicates the book to North and Simon. North is, of course, a towering figure. But Simon is a forgotten scholar whose wonderful work deserves recognition. Officer’s criticisms, when he makes them, are measured and fair.

The book is a major contribution to U.S economic history. To be sure, it does not change the broad outlines of what we know about U.S trade and foreign indebtedness before 1919 – North and Simon did their work well. But Officer puts the estimates on a firmer basis. Take the external terms of trade. Officer covers commodity and service trade for the entire period where most work in economic history is for commodity trade. He improves deflators and replaces the fixed weight price indices with a more appropriate deflator. The result is that we now have an external terms of trade series for the U.S from 1790 to now that is superior to the estimates for other developed economies. Throughout, Officer either improves on previous work or he provides new series.

Overall, the book is a monumental effort and its mastery of disparate sources puts it on a par with classics such as Lebergott (1964). It will surely stimulate further research. Officer’s early work on the dollar-pound exchange rate is partly responsible for the literature on long run real exchange rates which rehabilitated purchasing power parity (see Lothian and Taylor, 1996). This book will have a similar impact. To provide one instance, the improved measures of U.S foreign assets/liabilities will facilitate work for economic history along the lines of Lane and Milesi-Ferretti (2007).

The book is not an easy read. Officer starts off with a review of previous estimates. Next, there is a long digression on the movement of people. Following this, he outlines how he constructs each series, chapter by chapter. Only at the end of the book does Officer draw the series together and talk about his overall results. I would prefer that he start with the big picture. Throughout, the writing is dense and assumes considerable knowledge. To understand the basic issues with historical measures of U.S external transactions, the reader is advised to consult North and Simon before starting Officer. There are other difficulties. Officer provides important new series, but the summary statistics do not indicate how they differ from the old. Given the extensive reliance on interpolation, it would also help if he gave some indication of possible error margins. All in all, these are minor quibbles. A more serious problem is that some of the most important series appear only as diagrams – including the external terms of trade and the various price series. This is due to space constraints, but it is unfortunate. The author, or the publisher, should consider making all the series available in spreadsheet form on their websites.



Lane, Philip R., and Gian Maria Milesi-Ferretti. (2007) “The External Wealth of Nations Mark II: Revised and Extended Estimates of Foreign Assets and Liabilities, 1970–2004.” Journal of International Economics 73: 223-250.

Lebergott, Stanley. (1964) Manpower in Economic Growth: The American Record Since 1800. New York: McGraw-Hill.

Lipsey, Robert E. (1963) Price and Quantity Trends in the Foreign Trade of the United States. Princeton: Princeton University Press for the National Bureau of Economic Research.

Lothian, James R., and Mark P. Taylor. (1996) “Real Exchange Rate Behavior: The Recent Float from the Perspective of the Past Two Centuries.” Journal of Political Economy 104: 488-509.

North, Douglass C. (1960) “The United States Balance of Payments, 1790-1860.” In NBER Conference on Research in Income and Wealth, Trends in the American Economy in the Nineteenth Century, Studies in Income and Wealth, Vol. 24. Princeton: Princeton University Press for the NBER.

Simon, Matthew. (1960) “The United States Balance of Payments, 1861- 1900.” In NBER Conference on Research in Income and Wealth, Trends in the American Economy in the Nineteenth Century, Studies in Income and Wealth, Vol. 24, Princeton: Princeton University Press for the NBER.


John Devereux is professor of economics at Queens College, City University of New York. His areas of research are International Economics and Economic History.

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Subject(s):Economywide Country Studies and Comparative History
International and Domestic Trade and Relations
Geographic Area(s):General, International, or Comparative
North America
Time Period(s):18th Century
19th Century
20th Century: Pre WWII

Progress through Regression: The Life Story of the Empirical Cobb-Douglas Production Function

Author(s):Biddle, Jeff
Reviewer(s):Field, Alexander J.

Published by EH.Net (May 2022).

Jeff Biddle. Progress through Regression: The Life Story of the Empirical Cobb-Douglas Production Function. Cambridge: Cambridge University Press, 2020. xii + 334 pp. $110 (hardback), ISBN 978-1108492263.

Reviewed for EH.Net by Alexander J. Field, Professor of Economics, Santa Clara University.


Jeff Biddle has written an intellectual history of the Cobb-Douglas production function. Actually, he argues, it’s a history not of the function itself, which predates Cobb and Douglas, but a method for estimating its parameters using ordinary least squares, to wit, regressing the log of an output measure on a constant and logs of labor and physical capital inputs. To be fair, the study offers some of both.

The concept of a production function is best understood in the context of an agricultural experiment station. The yield of a plant (output) can be thought of as dependent on the quantities of a variety of inputs: water, fertilizer, sunlight, for example. The incremental (marginal) products of these different inputs can be measured through controlled experiment, varying the amount of one input while everything else is held constant. From such data one can hope to identify and describe mathematically a function linking the flow of output to the amounts of various inputs, and the rapidity with which the incremental product declines with additional doses, holding other inputs constant. The production function for a particular plant species would be understood to have a real, objective basis in biochemistry, and could be assumed to be similar for all specimens of the same species.

Substitute a particular physical product for an agricultural crop, and the concept, it would seem, can be extended to manufacturing. The production function would now reflect an underlying engineering reality and could be assumed similar in different establishments or firms producing the same good. Given observational data on different combinations of inputs, the underlying function could in principle be identified.

But that’s not what mathematician Charles Cobb and economist Paul Douglas actually attempted. Initially they ran time series regressions where the unit of observation was the entire U.S. manufacturing sector, followed by a study on Massachusetts and then estimates using data from the state of Victoria in Australia. There were and are multiple problems in extending the biological analogy to these larger aggregates and including on the right-hand side just two aggregated inputs, labor and capital. Both are heterogeneous, capital much more so than labor. One can perhaps argue that labor has a natural metric, the person-hour or person-year, but there is no such metric for the wide variety of physical capital goods. Although one would like measures of capital service flow, one will almost invariably be stuck with gross or net stock data serving as proxies. And even if depreciation in market value of different vintages of different types can be measured accurately, service flow deterioration will in almost all cases run more slowly than the decline in market value (depreciation). The extreme case is Oliver Wendell Holmes’ one hoss shay, which fell apart all at once after 100 years. The service flow (and presumably the rental rate) remained the same for a century, but a 98-year-old shay would still command a much lower market value than one which was new or almost new.

Robert Solow dismissed the prospect of calculating capital service flows as “utopian” (1957, p. 314), but today the Bureau of Labor Statistics and other OECD statistical agencies do make a run at it, distinguishing between productive stocks, constructed to grow pari passu with service flows, and wealth stocks (what the Bureau of Economic Analysis calculates). Economics researchers seem largely unaware of these procedures, or, arguing that deterioration in service flow runs geometrically at the same rate as the declines in market value, maintain that a distinction between productive and wealth stocks is unnecessary.

Assuming one does have measures of productive stocks, should there be a utilization adjustment? Douglas felt as did Solow and others after him, that one was needed. My own view is that its desirability is questionable, given that deterioration of fixed capital service flow is largely unaffected by how intensively buildings or equipment are used. The rate at which a building’s roof wears out, or a machine becomes obsolete, are illustrative of forces other than utilization that can govern both deterioration and depreciation. Douglas regretted he was not able to make such an adjustment; Solow made one.

There remains the problem of how one aggregates a sectoral output consisting of many different types of physical products. Is it acceptable to use value added? And the challenges continue. Assuming one can develop plausible measures of the service flows from aggregated labor and capital, is it reasonable to assume that the production functions used in making different products are all the same? Really? Elasticities of substitution are the same, as are the marginal products of ‘capital’ and ‘labor’? Doesn’t that present serious aggregation problems? And, in a cross-section regression, if the production functions are indeed the same across different products, and both market and input markets are all perfectly competitive, wouldn’t all firms and all sectors exhibit the same proportions of capital to labor (at least in long term equilibrium), in which case the regression would suffer from extreme multicollinearity, making it nearly impossible to estimate parameters of an aggregate production function with any degree of precision?

The challenges seem daunting. And yet I would hazard that a sizable majority of economists and economic historians (present company included) refer in their research and teaching to Cobb-Douglas functions, often acutely aware that they are engaged in some hand waving. In describing the initial and continuing reaction to the Cobb-Douglas enterprise, Biddle’s book discusses almost all of these concerns, and gives economic researchers an opportunity to reflect on the nature of their own handwaving and whether or not it is justified given the uses to which their inquiries are put. It is particularly useful to revisit the language used by scholars such as Solow (pp. 248-49) or Zvi Griliches (pp. 294-95) as they finesse these issues and compare their rationales with one’s own.

The book is primarily focused on developments from the 1920s through the 1970s and is divided into two main parts, each with three chapters, followed by a concluding chapter (part III). The materials studied for the most part are published journal articles, and the method for each is to provide an explication of the key arguments along with varying degrees of commentary and evaluation. Following a brief introduction, chapter 1 covers the initial time series studies as described in Cobb and Douglas’s 1928 American Economic Review article and Douglas’s 1934 book, The Theory of Wages, along with initial reactions and criticisms, and subsequent time series studies by Douglas and coauthors.

Chapter 2 is principally focused on debates with economist Horst Mendershausen, who came at Cobb and Douglas from several directions. The most damaging argument was that one could not simply assume “the” production function remained unchanged over multiple decades, and use variation in capital and labor inputs to identify a function that was in fact a moving target. Mendershausen would not be the last to raise this objection. It is perhaps not accidental that around this time Douglas switched from time series to cross-section studies. This avoided some of the hoary problems of adjusting for price changes of capital goods in accounting for depreciation and net additions in building up an inflation adjusted time series of a physical capital wealth stock. But, in moving to cross sectional data with different industries serving as the unit of analysis, one could still wonder whether all industries faced a similar production function. Cleverly, Douglas used the possibility that a few did not in explaining large residuals (differences between the predicted and actual value of production based on his regression estimates) (p. 100). Other complaints voiced by Mendershausen revolved around the fact that all three of the key series moved upward fairly systematically over time – as well as questions about whether it was reasonable to maintain the hypothesis that output was the dependent variable and labor and capital were independent right-hand variables. A number of authors argued that the question of which was dependent and which independent should be decided by “objective” statistical inquiry, whereas Douglas argued, I think convincingly, that one could use knowledge about how the world works to justify the assumption that labor and capital service flows produced output, rather than vice versa.

Douglas’s academic career was interrupted in 1942 when he enlisted in the Marines and then, following a short postwar coda, ended when in 1948 he ran successfully for the U.S. Senate. Chapter 3, the final chapter in part I, covers Douglas’s presidential address to the American Economic Association (AEA), in which he summed up his contributions, as well as additional commentary and criticism from the 1940s. The latter included Jan Tinbergen’s observation that in the cross-sectional studies, variations across industries in capital-labor ratios could come about only if different industries had different production functions, or if different regions faced different labor or capital supply conditions, and thus different factor prices. But the latter could not be the case if input markets were truly competitive. The chapter continued with discussion of papers by Melvin Reder, Martin Bronfenbrenner (an earlier coauthor with Douglas) and Jacob Marschak and William J. Andrews. In his valedictory address to the AEA, Douglas mentioned none of these (p. 130).

Part II of the book is concerned with “diffusion” of Douglas’s research program, spotlighting research in two areas that grew out of his initiative: agricultural economics (chapter 5) and growth accounting (chapter 6). Prior to developing these two “case studies”, in chapter 4 Biddle covers three somewhat unrelated developments during the 1950s: the treatment of the Cobb-Douglas research program in the first econometrics textbooks, the 1957 critique by E.H. Phelps-Brown, and the development of the CES (constant elasticity of substitution) production function of which the Cobb-Douglas function was a special case. Chapter 5 is organized around the work of Earl Heady and a group at Iowa State University. The appeal of the research program within that subdiscipline has already been mentioned. Even where the studies were observational rather than experimental, the greater prevalence of single product firms and the practical questions farmers were concerned with helps explain why the research program was attractive.

Chapter 6 covers growth accounting. With the burgeoning postwar interest in economic growth came empirical attempts to partition advance into the portion attributable on the one hand to input growth conventionally measured and on the other hand to scientific, technological, and organizational progress. The fundamental growth accounting equation is obtained by differentiating both sides of the Cobb-Douglas function with respect to time and can be estimated by running the change in the log of output against a constant and changes in the logs of capital and labor inputs. In that sense the efforts are an offshoot of the Cobb-Douglas program. Biddle acknowledges however, that few growth accounting studies used this method, instead preferring a pure accounting exercise, with the residual calculated as the difference between real output growth and a weighted average of the two key inputs.

One can still argue that growth accounting has a lineage stretching back to Cobb-Douglas. These weights are usually based on factor shares, and Cobb and Douglas maintained that the coefficients on labor and capital they were estimating should equal marginal productivities, which in turn would be reflected in factor shares. But one can question whether that linkage really matters for growth accounting. One of the attractions of such work is that it can be less demanding of commitment to some of the standard production function baggage (p. 280). Even if one remains agnostic about marginal productivity theory, one can argue that weighting by factor shares remains as good a practice as any, and proceed accordingly. Biddle makes an interesting point in crediting Solow with explicitly tying the growth accounting program to the production function framework, insisting that one was separating shifts of a production function from movements along it (p. 251). Indeed, Biddle sees that as Solow’s most important contribution, since little else in the 1957 article can be said to be truly original.

This book can be read profitably by those with interests in the twentieth century history of economics and econometrics, and, more specifically, in production functions and attempts to estimate them. I acknowledge and respect the efforts of the author to be fair to all participants, but at times I wished for a more consistent balance of exposition and evaluation. A work such as this can add value if the author can capture with more clarity and in shorter compass what the original author(s) argued. Simply recapitulating the main arguments, however, can invite readers to ask whether it would not be better simply to read the original texts, a query I frequently posed and acted upon (almost all of the articles are available on JSTOR). Now and again in the book Biddle offers his own judgments. I would have appreciated more articulation of his point of view.

A minor issue: the author repeatedly uses the words homogenous and homogeneous interchangeably. Only the latter is appropriate in charactering a mathematical function.


Solow, Robert M. 1957. “Technical Change and the Aggregate Production Function.” Review of Economics and Statistics 39 (August): 312–20.


Alexander J. Field is the Michel and Mary Orradre Professor of Economics at Santa Clara University. He is the author of A Great Leap Forward: 1930s Depression and U.S. Economic Growth (Yale University Press, 2011) and The Economic Consequences of U.S. Mobilization for the Second World War (Yale University Press, October 2022).

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at

Subject(s):Economic Development, Growth, and Aggregate Productivity
History of Economic Thought; Methodology
Geographic Area(s):General, International, or Comparative
North America
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII

Navigating Life and Work in Old Republic São Paulo

Author(s):Ball, Molly C.
Reviewer(s):Grandi, Guilherme

Published by EH.Net (May 2022).

Molly C. Ball. Navigating Life and Work in Old Republic São Paulo. Gainesville, FL: University of Florida Press, 2020. xx + 271 pp. $35.00 (paper), ISBN 978-1-68340-171-1.

Reviewed for EH.Net by Guilherme Grandi, Professor of Economics at University of São Paulo.


“It is time to reencounter and reconsider economic history,” Molly Ball writes in the introduction to her book Navigating Life and Work in Old Republic São Paulo. For the researcher, a history lecturer at the University of Rochester, the history of working-class families in São Paulo during the Old Republic period is an ideal subject when it comes to building on our knowledge of labor relations in this Latin American immigrant city from 1891 to 1930. Yet why does she make this claim? Probably because the history of labor and immigration in Brazil have customarily been a subject of study within Social History and Sociology, rather than Economic History. Nevertheless, this does not mean that there is a dearth of excellent work on this subject, produced by economic historians in Brazil and abroad.

Navigating Life finds its place among a set of studies where one of the biggest references is the work of Warren Dean. Originally published in 1969, his book entitled The Industrialization of São Paulo opened up a field of research opportunities on labor and industry in one of Latin America’s immigration cities. Dean was a pioneer in highlighting the role played by foreign migrants in the development of industry in São Paulo. Other researchers followed Dean down this path, including Wilson Cano with his Raízes da concentracão industrial em São Paulo (The Roots of Industrial Concentration in São Paulo), first published in 1977. However, Ball’s book is most importantly in dialog with immigration studies in Brazil. It is an addition to other valuable studies on migration streams and living conditions for workers coming into southeastern Brazil. In this sense, she opens a window, allowing us to penetrate deeper into rank-and-file Paulistano workers’ lives. Using an up-to-date statistical method combined with other social research techniques, Ball lays bare some of the quirks of the labor market in Old Republic São Paulo, such as the discriminatory practices used against women workers, Portuguese immigrants, and Afro-Brazilians.

It is crucial to put her study in perspective in relation to others, because it has advanced an understanding of how life and work were articulated in São Paulo during the period in question. It is interesting to note that Sidney Chalhoub, the author of Trabalho, lar e botequim (Labor, Home and Tavern), did something quite similar in his study on the daily life of workers in Rio de Janeiro during the belle époque. Moreover, Santos e Imigração na Belle Époque (Santos and Immigration in Belle Époque), a diligent study by Marília Cánovas, also deserves mention regarding the historical reality of Spanish immigrants in Santos, a port city in the state of São Paulo. These works (the former published in 1986 and the latter in 2017) provide us with a range of evidence that can be compared to some of Ball’s findings.

Ethnic identity is one of them. Ball shows that there was a pronounced difference in relation to workers’ nationality that strongly impacted how immigrants entered São Paulo’s formal labor market and the results they were capable of obtaining. The prejudice held by Paulistano entrepreneurs, as identified by the author in her discussion of workers from Portugal, is emblematic and revealing in this regard. She shows how Portuguese immigrants experienced hiring discrimination in São Paulo, while German, Austrian and Italian immigrants could hold jobs that led to mobility into the working middle class. This unequal treatment also impacted access to health and education services for their children and relatives. This meant that Portuguese and Afro-Brazilians descendants were disproportionately hired for unskilled positions as compared to other foreign nationals. According to Ball, white workers were more likely to find a job in medium-skilled positions, corresponding to nine out of every ten workers hired. In contrast, black and pardo workers were more likely to be hired for unskilled positions, accounting for around 19 percent of these positions.

As Joel Wolfe had already pointed out in Working Women, Working Man, a study published in 1993, the gender gap is another fascinating topic highlighted by Ball. The wage disparity between men and women in the city of São Paulo is shown by using original archival and primary sources, like company reports, worker records, newspaper price databases, and cost-of-living surveys that she found in researching several Brazilian, American, and European archives. In examining the historical reality of four economic sectors (railroad, energy and urban transport, textile, and department stores), Ball discusses patterns and trends related to the hopes and behaviors of workers in the Paulistano labor market. What opportunities were available to them in terms of going on strike, job replacement, wage bargaining, and so on? The author emphasizes how different groups had shared expectations based on gender, racial, and national identities. In fact, black people, unskilled workers, and women frequently faced significant hiring discrimination and persistent wage disparities in Old Republic São Paulo. The research she has undertaken makes this clear and shows how difficult it was for these groups of people to find opportunities for advancement and social mobility throughout this period. She succinctly writes that “workers adapted their strategies to navigate the discrimination they faced.”

The most remarkable feature of Navigating Life is its research method, in line with New Economic History guidelines. Throughout the book’s six chapters, but particularly in Chapters 1 and 4, robust statistical evidence puts the labor history of Old Republic São Paulo at the same level that others have already placed places like Buenos Aires in Argentina and New York in the United States. Like São Paulo, these cities were highly sought out by European immigrants during the so-called First Globalization, i.e., between 1870 and 1914. Undoubtedly, Ball’s book has already found a place as essential literature in studies on living conditions experienced by workers in São Paulo during the golden age of the coffee economy. With plenty of well-founded arguments, it is an outstanding work of research that goes beyond paraphrasing the best and most widely-known interpretations of São Paulo’s economic and social history, so to speak, along with classical works on Brazilian historiography. Researchers with an interest in the labor history and economics of Brazil’s biggest city have a lot to gain from a reading of Navigating Life.


Cano, W. (1990), Raízes da concentração industrial em São Paulo. 3a ed. São Paulo: Hucitec.

Cánovas, M.D.K. (2017), Santos e Imigração na Belle Époque. Os Espanhóis – Cotidiano Urbano, Práticas Associativas e Militância Política (1880-1922). São Paulo: Edusp.

Chalhoub, S. (2012), Trabalho, lar e botrquim: o cotidiano dos trabalhadores no Rio de Janeiro da belle époque. 3a ed. Campinas: Editora da Unicamp.

Dean, W. (1969), The Industrialization of São Paulo. 1880-1945. Austin: University of Texas Press.

Wolfe, J. (1993), Working Women, Working Men: São Paulo and the Rise of Brazil’s Industrial Working Class, 1900-1955. Durham, NC: Duke University Press.


Guilherme Grandi is Professor of Economics at University of São Paulo. His research focuses on the history of transports, immigration, and labor history. He is the author of Estado e capital ferroviário em São Paulo (Alameda, 2013) and the co-organizer of História Econômica do Brasil: Primeira República e Era Vargas (Hucitec/Eduff, 2020).

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at

Subject(s):Economywide Country Studies and Comparative History
Labor and Employment History
Geographic Area(s):Latin America, incl. Mexico and the Caribbean
Time Period(s):19th Century
20th Century: Pre WWII

Crafting the Movement: Identity Entrepreneurs in the Swedish Trade Union Movement, 1920–1940

Author(s):Jansson, Jenny
Reviewer(s):Bengtsson, Erik

Published by EH.Net (May 2022).

Jenny Jansson. Crafting the Movement: Identity Entrepreneurs in the Swedish Trade Union Movement, 1920–1940. Ithaca, NY and London: ILR Press, an imprint of Cornell University Press, 2020. xi + 200 pp. $19.95 (paperback), ISBN 978-1501750014.

Reviewed for by Erik Bengtsson, Associate Professor of Economic History, Lund University.


The first sentence of this book is: “The Swedish reformist labor movement of the twentieth century constitutes a success story.” Jansson, a political scientist at Uppsala University, says, “A strong Social Democratic Party–Socialdemokratiska arbetarpartiet (SAP)—and high union density paved the way for an extensive and comprehensive welfare state and diminishing wage inequality,” and that a “key component” in this success is “the labor movement’s extraordinary ability to mobilize the majority of the working class early on in its mission.” The purpose of Jansson’s book is to explain why the Swedish trade union movement chose a reformist way in the interwar period when, after the radical challenges of the 1910s (Syndicalism, Communism), they had to handle radical critiques and dissent. The authors suggests that the reformist way was connected to the success of the Swedish labor movement.

Her argument centers on the actions and strategies of trade union leaders, who in Jansson’s parlance acted as “identity entrepreneurs.” The trade union leaders recognized competition from the radical trade union confederation SAC (founded in 1910) and from communists in their own unions and acted strategically to reinforce a reformist identity among rank and file trade unionists.

After an introductory chapter which briefly presents the context and the argument, chapter 2 gives a more comprehensive context under the headline of “Problems identified by the LO leadership.” Here we are introduced to the syndicalist unions and to the communists challenging reformist leadership within the dominant LO (Landsorganisationen, or Trade Union Confederation) federation of unions. Chapter 3, “A plan for identity management,” studies the LO leadership in the early 1920s and how they identified the radical challenges and handled them. The LO leaders strengthened their control over the Workers’ Educational Association (ABF), created a new trade union magazine to spread news and ideology to unionists, reinforced reformist agitation among rank-and-file unionists and non-unionized workers, and in 1929 started a central school (Brunnsvik) for trade union education. Chapter 4 analyzes identity construction in the educational materials spread among LO members through the Workers’ Educational Association. The focus is on the syllabi and literature for the courses “Trade union studies” and “Organizational studies.” Chapter 5, “Implementing the education strategy,” which is the longest chapter, combines the national level with the local level as it presents the evolution of workers’ education in Sweden in the 1920s and 1930s on the aggregate level, as well as a local study of workers’ education in the mill town of Skutskär, dominated by the Stora Kopparberg corporation. Chapter 6, clocking in at 10 pages, provides the conclusions of the book.

Crafting the Movement is a focused, interesting study of the role of workers’ education in the Swedish labor movement. It is a slim volume which presents its argument in a lean, efficient way. On the way, we learn much about the role of workers’ education in the history of Swedish Social Democracy. However, there is also a problem with the slimness of the presentation, not on the empirical level but for the overarching argument to convince. Jansson states, with reference to research in organization studies, that “the process of identity formation is never completely top-down because ‘organizational members are not reducible to passive consumers of managerially designed and designated identities’.” (p. 45) But in the conclusions to another chapter, she states that “Organizational members can indeed be controlled through identity formation.” (p. 99) In practice, the analysis to a high degree follows the latter formulation: organization leaders are front and center in the analysis, and the rank and file appear to be an anonymous mass that is molded by the leaders to the right reformist way of thinking.

Jansson presents the years around 1920 as a “critical juncture” (pp. 43, 157) for the Swedish labor movement, choosing between reformism and revolutionary ways, but I would argue that a fuller explanation of the earlier history would show that the revolutionary way was less likely as an alternative than it seems in Jansson’s account. There were surely communists and syndicalists in Sweden, but for historical reasons, they never became as powerful as in, say, Germany, Italy, or Spain. Geoff Eley, in the classic survey of European labor movements Forging Democracy (2002), discussed why some national labor movements became predominantly revolutionary and others predominantly reformist. Eley showed how late extensions of suffrage fostered cooperation between liberal and labor parties, and the Swedish case, where national suffrage before 1909 was given only to one fifth of adult men and no women, is a very good example of this. As Eley points out, in Sweden, Liberals and Socialists collaborated around the overarching aim of universal suffrage in the 1890s, 1900s and 1910s, and this strengthened the reformist vein in the SAP (Eley, pp. 67–68). We should remember that it was a Liberal-Social Democratic coalition government that carried through the reform of universal suffrage in 1918. Historians like Madeleine Hurd (Public Spheres, Public Mores, and Democracy: Hamburg and Stockholm, 1870-1914, 2000) and Sven Lundkvist (Folkrörelserna i det svenska samhället 1850–1920, 1977) have also shown how the Swedish labor movement was colored by its decades of collaboration with Liberals, and studies of workers’ libraries by Marion Leffler (Böcker, bildning, makt: Arbetare, borgare och bildningens roll i klassformeringen i Lund och Helsingborg 1860-1901, 1999), Hans Larsson (Tidstecken : Stockholms arbetarbibliotek och samhällskroppens utformning, 1892-1927, 1989) and others have shown the degree of “bourgeois” influence on workers’ reading already around the turn of the twentieth century. Against this background, the choice of a reformist strategy in the early 1920s appears less as the outcome of a completely open “critical juncture,” and more as the outcome of a decades-long tradition of politics and workers’ education. This by no means invalidates Jansson’s emphasis on the strategic use of workers’ education to strengthen the reformist tendency in the trade unions, but her argument would have been more well-rounded and precise had she positioned it against this background of popular movements and workers’ libraries, back to the 1870s.

In the concluding chapter, Jansson discusses the contributions of her study as: “By constructing an organizational identity based on reformism, the LO undoubtedly helped mobilize workers to vote for the SAP. By identifying that dynamic, this study presents one more piece in the puzzle of understanding the strength of the SAP. However, this book’s main contribution to understanding Sweden concerns labor market relations rather than the political party sphere.” (p. 164) She points to a key finding of the book: “The novel aspect that this study brings to industrial relations research in general, and to understanding Swedish industrial relations in particular, is that the spirit of consensus was established among the workers before the Basic Agreement was reached.” (p. 165) At least since the study of Walter Korpi and Michael Shalev (“Strikes, Industrial Relations and Class Conflict in Capitalist Societies,” 1979) it has been an accepted stylized fact that the Swedish labor market in the 1920s was one of the most strike- and lockout-intensive in the industrialized world, in contrast to the spirit of cooperation after 1938. However, Jansson in her reconstruction of the reformist ideology of the union leaders in the 1920s shows how by then the leadership was already propagating a conciliatory view of the employers and their organization. In this way, Jansson’s study has presented new evidence both on the reformist road of the Social Democratic party in Sweden, and on the road to union-employer collaboration in the Swedish labor market.


Erik Bengtsson is Associate Professor of Economic History at Lund University. His research focuses on historical income and wealth distribution, and political history.

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Subject(s):Economywide Country Studies and Comparative History
Labor and Employment History
Geographic Area(s):Europe
Time Period(s):20th Century: Pre WWII

Permanent Revolution: Reflections on Capitalism

Author(s):Wells, Wyatt
Reviewer(s):Niles, Raymond C.

Published by EH.Net (May 2022).

Wyatt Wells. Permanent Revolution: Reflections on Capitalism. Stanford: Stanford Briefs (Imprint of Stanford University Press), 2020. 192 pp. $14, ISBN 978-1503612372.

Reviewed for EH.Net by Raymond C. Niles, Senior Fellow, American Institute for Economic Research.


Permanent Revolution is a superb integrative discussion of capitalism that unites history and economics with its political, cultural, and sociological foundations. When academics typically confine themselves to an in-depth “silo” of knowledge cut off from other domains, this form of integration is rare and welcome. Moreover, the author displays a deep, scholarly grasp of each area, although not without some shortcomings.

Capitalism is an ideologically fraught topic. Wells avoids the biases of ideology by ruthlessly focusing on facts. Unfortunately, he does this without any footnotes. This makes the book very readable – he is a talented writer and the text flows – but it is a shortcoming for the academic reader who may want to explore further the sources of his facts. Where this reviewer has first-hand knowledge, he can attest that Wells has captured them faithfully, but citations would allow anyone, even non-experts, to make that determination on their own.

The title, “Permanent Revolution,” is a nod to Joseph Schumpeter, the early 20th century economist and student of capitalism’s history and economics, whom the author quotes at length throughout the book. This is a wise choice, because Schumpeter, like Wells, takes a broadly integrative and historical approach to understanding capitalism, which allowed him to come up with insights that still seem profound and modern today, more than 70 years after his death.

Consider this memorable quote from Schumpeter that Wells uses to show that capitalism raises the standard of living of the “masses” even while simultaneously creating inequality:

“The capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within the reach of factory girls in return for steadily decreasing amounts of effort.” (p. 122)

Inequality is not a bug of capitalism, but a feature. It incentivizes entrepreneurial innovation and harnesses the large chunks of capital required to fund large enterprises and achieve the economies of scale that raise our standard of living. Wells provides numerous fascinating case studies of this process in action, using well-known entrepreneurs such as Rockefeller, Carnegie, and Ford, but also less well-known ones, such as Chessie Cummins of Cummins Engine and Homer Laughlin, who invented the popular Fiesta tableware during the Great Depression.

Wells offers numerous examples explaining the beneficial role of Wall Street finance in mobilizing capital, directing it to its highest-valued uses, and reconstituting failing businesses. In one example, he recounts how financier J.P. Morgan “morganized” – i.e., restructured – the failing Richmond Terminal railroad conglomerate in 1893 by removing incompetent management, shedding underperforming assets, and creating the successful Southern Railroad.

Schumpeter famously said that capitalism produces “gales of creative destruction.” Similarly, Wells sees a “permanent revolution” where capitalism not only continually reshapes a nation’s economic institutions, but all aspects: political, cultural, artistic, and educational. Wells sees capitalism as the engine at the center of a beneficial liberalism, which flowered during the 19th century when capitalism swept the Western world:

“Moral advances have accompanied material ones. By the early twenty-first century, every country in the world had formally banned slavery, and most had substantially expanded the rights of women.” (p. viii)

Another virtue of the book is that it is free of Marxist cant, which mars too many histories of the capitalist era. He avoids such built-in pejorative language as “robber baron,” despite its common use. He implicitly acknowledges that the great entrepreneurs of the “Gilded Age” and the 20th and 21st centuries earned their fortunes by creating abundant beneficial products for the mass market. In that vein, in plain language he defends such practices as financial speculation and rebuts the common Marxist charge that capitalism alienates labor.

His defense of profit is masterful, making capitalism fundamental even to progress in the non-material, spiritual realm.

“Financial profit is inseparable from economic efficiency, however. Assuming competent accounting and reasonably efficient markets, profit is simply the surplus above and beyond the cost of production, and it pays for everything else in society – art, literature, religion, philosophy. Profit is necessary, though not sufficient, for ‘the good life’.” (p. 70)

If there is any criticism of the book, it is what I would call “status quo bias.” The author never explicitly defines capitalism and makes a common error among historians of equating mixed capitalistic economies with “capitalism.” This lets him fall into the trap of impugning some problems as capitalism’s failure when, in fact, they are the result of government intervention.

This is particularly true in his discussion of banking (despite his worldly discussion of Wall Street finance). He accepts without question that America’s problem with “wildcat banking” in the 19th century was a problem with capitalism. He is apparently unfamiliar with the work of financial economists and historians such as Lawrence H. White, George Selgin, and Richard Timberlake, which shows that the bank runs and failures of the 19th century stemmed from the state-level franchises and unit banking laws that prevented a robust national banking system from emerging. This is why when the Great Depression hit neighboring United States and Canada, the U.S. lost 40% of its 40,000 tiny, fragmented banks to bankruptcy while Canada did not have a single bankruptcy among its 12 national banking networks.

He makes a similar error when discussing the British economic malaise of the 1920s. He conflates as explanation the simple historical observation that the recession reflected the failure of new companies to employ enough of the newly unemployed workers from declining industries. This “employment” view of business cycles does not explain; it only describes. A close study of British economic history shows that the actual cause of the 1920s malaise was financial. It was caused by the Bank of England’s mispricing of the British pound after the war when it tried to restore the pound’s pre-war parity to gold. Because of inflation during the war, this merited a huge deflation, which hurt borrowers throughout the economy.

Permanent Revolution is a delight to read. In terse, lucid prose, loaded with numerous examples, it demonstrates that as capitalism permanently and relentlessly overturns the status quo, it simultaneously elevates us, economically and culturally.


Raymond C. Niles ( is a Senior Fellow at the American Institute for Economic Research. He holds a PhD in Economics from George Mason University, teaches economics at the university level, and is a former Wall Street executive.

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at

Geographic Area(s):General, International, or Comparative
North America
Time Period(s):19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Temp: The Real Story of What Happened to Your Salary, Benefits, and Job Security

Author(s):Hyman, Louis
Reviewer(s):Jacoby, Sanford M.

Published by EH.Net (May 2022).

Louis Hyman. Temp: The Real Story of What Happened to Your Salary, Benefits, and Job Security. New York: Penguin Books, 2018. xii + 388 pp. $17 (paperback), ISBN 978-0735224087.

Reviewed for EH.Net by Sanford M. Jacoby, Distinguished Research Professor of History, Management, and Public Policy, University of California, Los Angeles.


Louis Hyman’s Temp is a history of what economists term “alternative work arrangements” and others “the gig economy.” Despite the title, workers supplied by temp agencies form only one part of the book. It also considers other types of nonstandard workers: independent contractors, on-call workers, and workers provided by contract firms. The book rests on the assertion that the standard employment model—characterized by direct, dependent employment of substantial duration, with some risk insurance provided by the employer—is giving way to these alternatives. Some of the same terrain has been canvassed in Erin Hatton’s historical study Temp Economy (2011) and David Weil’s The Fissured Workplace (2014).

Temp is gracefully written, straddling general and academic audiences. The sweep is broad, covering the last seventy years. Temp contains original archival material, especially on Manpower, one of the largest and earliest (but not the first) temp agencies.

Chapter 1 discusses the origins during the 1930s of “good jobs”—the standard employment model that was propelled by unions and by New Deal labor policies. The next three chapters examine the rise of new employment models during the postwar decades. First came the growth of temporary clerical positions staffed by women supplied by agencies like Manpower. Lacking pensions, health insurance, and the expectation of continuous employment, temps were cheaper than full-time workers. Chapter 3 is a brief history of McKinsey, the consultancy, which adopted another alternative to standard employment, the up-or-out partnership. Chapter 4 turns to the Bracero guest worker program, which began in the 1940s as a way of regulating low-wage farmworkers brought from Mexico. Hyman views the Braceros as a precursor to widespread reliance on undocumented workers.

Chapters 6 through 9 focus successively on the three decades between 1960 and 1990. Manpower and McKinsey adapted to the multidivisional (M-form) conglomerates and multinational corporations of the 1960s, but then had to shift gears as those organizational forms unraveled during the 1970s and 1980s. It all came together in Silicon Valley in the 1980s, where consultants advised tech companies to adapt to cyclical and product life-cycle instability not only with temps but a panoply of other job types: on-call workers, independent contractors, freelancers, and undocumented workers. It’s unclear how employers choose among these options, which vary in their economic and regulatory logics.

Chapter 11 is the book’s longest, where we meet the downsizing and restructuring of the 1990s, with the focus mostly on tech. It led to the burgeoning of “temp slaves,” “Microserfs,” and “disposable workers”—the Gen-Xers closed out of stable jobs in the corporate core. The narrative passes quickly through other topics, including subcontracting and misclassification, as well as leased workers.

The last two chapters jump to the present. First we meet Uber and Instacart, and also the scheduling algorithms that have turned retail and other jobs into a just-in-time system of on-call work. It gets confusing when robots, blockchains, digital cooperatives, and bitcoin are tossed into the mix. Finally, the book takes a stab at public policies to ameliorate the loss of income and employment security that full-time jobs provide. Here Hyman pieces together a melange of proposals that are in the zeitgeist: infrastructural spending to take up labor market slack created by robotization and offshoring; revision of labor and employment law to accommodate gig work; and a universal basic income that would ameliorate the insecurity of flexible work. Flexibility, says Hyman, is the new reality, and rather than fighting it “we can find a way to provide a new American dream that is, in essence, the oldest one of all—to declare our independence.”

One concern with the book is that it’s overambitious. It moves rapidly through a plethora of topics, so that the analysis becomes superficial in several places. General readers may welcome the fast pace, but academics may find themselves overwhelmed by generalizations. What is variously called a thesis, guiding argument, or central theory is difficult to discern.

Contrary to the book’s thrust, alternative work arrangements are not sweeping the labor market. The share of employment accounted for by temps, contract workers, and on-call workers was stable between 1995 and 2017. The fourth and largest group—independent contractors—saw its employment share rise two-tenths of one percent during that period. In all, alternative work arrangements represent about 10 percent of jobs (not including part-time work). These data are from the Bureau of Labor Statistics. A re-analysis by Katharine Abraham and Susan Houseman finds an increase in alternative arrangements from 1995 to 2005, and a subsequent decline nearly to the 1995 level. They also find that dissatisfaction with alternative work arrangements is high. Most workers do not like most of these jobs.

In Europe, alternative arrangements are more heavily regulated than in the Anglo-Saxon countries, out of a concern that it’s important to protect full-time jobs. Recently, however, the UK and US have stepped up regulation. Courts and regulators have ruled that Uber drivers and other gig workers actually are employees who have been intentionally misclassified to cut costs, as with temp workers during the 1950s. On the other side are economists, like the late Alan Krueger, and employers like Uber, who assert that gig workers can’t be jammed into the Procrustean bed of the standard employment model. Hyman seems to agree with that assertion but could have done a better job defending his position.

Despite these criticisms, the book surely will find its way into these policy debates. I found its breadth impressive, the evidence original and interesting, and the prose engaging.


Sanford M. Jacoby ( is Distinguished Research Professor of History, Management, and Public Policy at the University of California, Los Angeles. He is the author of Labor in the Age of Finance: Pensions, Politics, and Corporations from Deindustrialization to Dodd-Frank (Princeton University Press, 2021).

Copyright (c) 2022 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2022). All EH.Net reviews are archived at

Subject(s):Business History
Labor and Employment History
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII