We document the outbreak of a trade war after the U.S. adopted the Smoot-Hawley tariff in June 1930. U.S. trade partners initially protested, with many eventually choosing to retaliate with tariffs. Using a new quarterly dataset on bilateral trade for 99 countries, we show that U.S. exports to retaliators fell by 28-32 percent. Using a second new dataset on U.S. exports at the product-level, we find that the most important U.S. exports to retaliating markets were particularly affected, suggesting a possible mechanism whereby the U.S. was targeted despite MFN obligations. The retaliators’ welfare gains from trade fell by 8-16%.
The Irish economy during the century after Partition (with Cormac Ó Gráda). Forthcoming, Economic History Review.
We provide a centennial overview of the Irish economy in the one hundred years following partition and independence. A comparative perspective allows us to distinguish between those aspects of Irish policies and performance that were unique to the country, and those which mirrored developments elsewhere. While Irish performance was typical in the long run, the country under-performed prior to the mid-1980s and over- performed for the rest of the twentieth century. Real growth after 2000 was slow. The mainly chronological narrative highlights the roles of convergence forces, trade and industrial policy, and monetary and fiscal policy. While the focus is mostly on the south of the island, we also survey the Northern Irish experience during this period.
Capitalism: Worries of the 1930s for the 2020s. Oxford Review of Economic Policy 37(4), 650-663 (2021).
The paper provides an assessment of the health of capitalism, concluding that in a global perspective the institution is prospering. Whether or not that is good for global, national, regional, or sectional welfare is another matter. The paper also compares some 1930s debates about capitalism with similar debates in our own time.
Commodity frontiers: a view from economic history (with Ronald Findlay). Journal of Global History 16(3), 462-465 (2021).
The history of frontiers is a fascinating topic for research, especially interdisciplinary research. We stress the need to engage with existing work on the topic by economists and economic historians, but we also highlight the need to engage with such topics as the history of inter-state conflict and violence, technological change, and the role of multiple interest groups in determining policy.
Four great Asian trade collapses (with Alan de Bromhead, Alan Fernihough, and Markus Lampe). Australian Economic History Review 61(2), 159-185 (2021).
This paper introduces a new dataset of commodity-specific, bilateral import data for four large Asian economies in the interwar period: China, the Dutch East Indies, India, and Japan. It uses these data to describe the interwar trade collapses in the economies concerned. These resembled the post-2008 Great Trade Collapse in some respects but not in others: they occurred along the intensive margin, imports of cars were particularly badly affected, and imports of durable goods fell by more than those of non-durables, except in China and India which were rapidly industrializing. On the other hand the import declines were geographically imbalanced, while prices were more important than quantities in driving the overall collapse.
To what extent did growth during the Industrial Revolution depend on coal? We answer the question using a panel of European city sizes between 1300 and 1900. Prior to 1750 there was no relationship between proximity to coalfields and growth; after 1750 cities closer to coalfields grew substantially faster than those further away. We instrument for coal proximity using proximity to Carboniferous-era rock strata.
“The anatomy of a trade collapse: The UK, 1929-33”, European Review of Economic History 23(2), 123-144 (2019) (with Alan de Bromhead, Alan Fernihough, Markus Lampe). Data.
A recent literature explores the nature and causes of the 2008-9 collapse in international trade. The decline was particularly great for automobiles and industrial supplies; it occurred largely along the intensive margin; quantities fell by more than prices; and prices fell less for differentiated products. Do these “stylized facts” hold for all trade collapses? This paper uses detailed, commodity-specific information on UK imports between 1929 and 1933 to compare the Great Depression and the Great Recession. It also compares the free trading collapse of 1929-1930 with the protectionist collapse of 1930-1933, to examine the relative importance of protection for the UK trade patterns.
The article surveys three economic history literatures that can speak to contemporary challenges to globalization: the literature on the anti-globalization backlash of the nineteenth century, focused largely on trade and migration; the literature on the Great Depression, focused largely on capital flows, the gold standard, and protectionism; and the literature on trade and warfare.
“When Britain turned inward: The impact of interwar British protection” (with Alan de Bromhead, Alan Fernihough, Markus Lampe). American Economic Review 109(2), 325-52 (2019). Data.
International trade collapsed, and also became much less multilateral, during the 1930s. Previous studies, looking at aggregate trade flows, have argued that trade policies had relatively little to do with either phenomenon. Using a new dataset incorporating highly disaggregated information on the United Kingdom’s imports and trade policies, we find that while conventional wisdom is correct regarding the impact of trade policy on the total value of British imports, discriminatory trade policies can explain the majority of Britain’s shift toward Imperial imports in the 1930s.
“Two Great Trade Collapses: The Interwar Period & Great Recession Compared,” IMF Economic Review 66(3), 418-439 (2018).
In this paper, I offer some preliminary comparisons between the trade collapses of the Great Depression and Great Recession. The commodity composi- tion of the two trade collapses was quite similar, but the latter collapse was much sharper due to the spread of manufacturing across the globe during the intervening period. The increasing importance of manufacturing also meant that the trade col- lapse was more geographically balanced in the later episode. Protectionism was much more severe during the 1930s than after 2008, and in the UK case at least helped to skew the direction of trade away from multilateralism and towards Empire. This had dangerous political consequences.
“Growth, Import Dependence, and War” (with Roberto Bonfatti), Economic Journal 128(614), 2222-2257 (2018).
Theories of war predict that the leader may launch a war on a follower who is catching up, since the follower cannot commit to not use their increased power in the future. But it was Japan who attacked the West in 1941: both leaders and followers start wars. Similarly, many have argued that trade makes war less likely, yet the First World War erupted at a time of unprecedented globalisation. We develop a model of trade and war that can explain both observations. Dependence on imports can lead followers to attack leaders or resource-rich regions when they are subject to blockade.
This article surveys independent Ireland’s economic policies and performance. It has three main messages. First, the economic history of post-independence Ireland was not particularly unusual. Very often, things that were happening in Ireland were happening elsewhere as well. Second, for a long time, we were hampered by an excessive dependence on a poorly performing UK economy. And third, EC membership in 1973 and the single market programme of the late 1980s and early 1990s were absolutely crucial for us. Irish independence and European Union (EU) membership have complemented each other, rather than being in conflict: Each was required to give full effect to the other. Irish independence would not have worked as well for us as it did without the EU; and the EU would not have worked as well for us as it did without political independence.
“Concorrenza e crescita nella storia Europea,” in Concorrenza Mercato e Crescita in Italia: Il Lungo Periodo, ed. Alfredo Gigliobianco and Gianni Toniolo, Marsilio, 117-147 (2017).
“Measuring the Spread of Modern Manufacturing to the Poor Periphery”, in The Spread of Modern Industry to the Periphery since 1870, co-edited by Kevin Hjortshøj O’Rourke and Jeffrey G. Williamson, Oxford University Press, 13-29 (2017).
“Economic impossibilities for our grandchildren?” Journal of the British Academy 4, 21- 51 (2016).
The paper looks at the development of the secular stagnation thesis, according to which insufficient investment demand could lead to unemployment being a problem in the long run. It does so in the context of the economic history of the time. It explores some 19th-century antecedents of the thesis, before turning to its interwar development. Not only Alvin Hansen, but Keynes and Hicks were involved in the conversations that led to Hansen’s eventual statement of the thesis that economists are familiar with today. The argument made sense in the context of the interwar period, but more so in Britain than the US. The paper concludes by looking briefly at the relevance of the thesis for today.
“The Great Depression of the 1930s and the world economic crisis after 2008”, in A History of the Global Economy, 1500 to the Present, ed. Joerg Baten, Cambridge University Press, 110-114 (2016).
“The economist and global history,” in The Prospect of Global History, ed. Jamie Belich, John Darwin, Margaret Frenz and Chris Wickham, Oxford University Press, 44-62 (2016).
“The Triangular Trade from a Global Perspective,” in The Legacy of Eric Williams: Caribbean Scholar and Statesman, ed. Colin A. Palmer, The University of the West Indies Press (with Ronald Findlay), 165-189 (2015).
« The Spread of Manufacturing to the Poor Periphery 1870-2007,” Open Economies Review 26(1), 1-37 (with Agustín S. Bénétrix and Jeffrey G. Williamson) (2015).
This paper documents industrial output growth around the poor periphery (Latin America, the European periphery, the Middle East and North Africa, Asia, and sub-Saharan Africa) between 1870 and 2007. We find that although the roots of rapid peripheral industrialization stretch into the late 19th century, the high point of periph- eral industrialization was the 1950–1973 period, which saw widespread import- substituting industrialization. This period was also the high point of unconditional industrial catching up, defined as the tendency of less industrialized countries to post higher per capita manufacturing growth rates, and which occurred between 1920 and 1990.
“A monthly stock exchange index for Ireland, 1864-1930,” European Review of Economic History 18(3), 248-276 (with Richard S. Grossman, Ronan C. Lyons and Madalina A.Ursu) (2014).
This paper constructs new monthly Irish stock market price indices for 1864–1930. In addition to a total market index covering 118 equity securities issued by ninety-four companies, sectoral indices are presented for railways, financial services companies, and “other” companies. Nominal equity prices doubled between 1864 and 1898. Between the turn of the century and 1914, prices fell by 25 percent, in contrast to the price increases experienced on the London exchange. Overall, the average annual gain in equity prices over the period was just 0.9 percent. We speculate about the respective roles of Irish politics and international shocks in driving these trends.
“From Empire to Europe: Britain in the World Economy,” in Cambridge Economic History of Modern Britain, 4th edition, ed. Roderick Floud, Jane Humphries and Paul Johnson, Cambridge University Press, 60-94 (2014).
“Introduction: The Spread of and Resistance to Global Capitalism,” in The Cambridge History of Capitalism, Volume 2, ed. Larry D . Neal and Jeffrey G. Williamson, Cambridge University Press, 1-21 (with Jeffrey G. Williamson) (2014).
“The Growing Dependence of Britain on Trade during the Industrial Revolution,” Scandinavian Economic History Review 62(2), 109-36 (with Gregory Clark and Alan M. Taylor) (2014).
Many previous studies of the role of trade during the British Industrial Revolution have found little or no role for trade in explaining British living standards or growth rates. We construct a three-region model of the world in which Britain trades with North America and the Rest of the World, and calibrate the model to data from the 1760s and 1850s. We find that while trade had only a small impact on British welfare in the 1760s, it had a very large impact in the 1850s. This contrast is robust to a large range of parameter perturbations. Biased technological change and population growth were key in explaining Britain’s growing dependence on trade during the Industrial Revolution.
“Coping with shocks and shifts: The multilateral trading system in historical perspective,” in Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century, ed. Robert C. Feenstra and Alan M. Taylor, University of Chicago Press, 11-37 (with Douglas A. Irwin) (2014).
“A Tale of Two Trilemmas,” in Enacting Globalization: Multidisciplinary Perspectives on International Integration, ed. Louis Brennan, Palgrave Macmillan, 287-297 (2014).
“Twentieth Century Growth,” in Handbook of Economic Growth, Volume 2, ed. Steven N. Durlauf and Philippe Aghion, Elsevier, 263-346 (with Nicholas Crafts) (2014).
This paper surveys the experience of economic growth in the 20th century with a focus on techno- logical change at the frontier together with issues related to success and failure in catch-up growth. A detailed account of growth performance based on historical national accounts data is given and is accompanied by a review of growth accounting evidence on the sources of economic growth. The key features of our analysis of divergence in growth outcomes are an emphasis on the importance of “directed” technical change, of institutional quality, and of geography. We provide brief case studies of the experience of individual countries to illustrate these points.
“Luddites, the Industrial Revolution, and the Demographic Transition,” Journal of Economic Growth 18(4), 373-409 (with Ahmed S. Rahman and Alan M. Taylor) (2013).
Technological change was unskilled-labor-biased during the early industrial revolution, but is skill-biased today. This implies a rich set of non-monotonic macroeconomic dynamics which are not embedded in extant unified growth models. We present historical evidence and develop a model which can endogenously account for these facts, where factor bias reflects profit-maximizing decisions by innovators. In a setup with directed technologi- cal change, and fixed as well as variable costs of education, initial endowments dictate that the early industrial revolution be unskilled-labor-biased. Increasing basic knowledge then causes a growth takeoff, an income-led demand for fewer but more educated children, and a transition to skill-biased technological change in the long run.
“Cross of Euros,” Journal of Economic Perspectives, 27(3), 167-92 (with Alan M. Taylor) (2013). Reprinted in The Economics of Sovereign Debt (ed. Robert W. Kolb and Frank W. Considine), Edward Elgar (2017).
“Political Extremism in the 1920s and 1930s: Do German Lessons Generalize?” Journal of Economic History 73(2), 371-406 (with Alan de Bromhead and Barry Eichengreen) (2013).
We examine the impact of the Great Depression on the share of votes for right- wing extremists in elections in the 1920s and 1930s. We confirm the existence of a link between political extremism and economic hard times as captured by growth or contraction of the economy. What mattered was not simply growth at the time of the election, but cumulative growth performance. The impact was greatest in countries with relatively short histories of democracy, with electoral systems that created low hurdles to parliamentary representation, and which had been on the losing side in World War I.
“Italy and the First Age of Globalization, 1861-1940,” in The Oxford Handbook of the Italian Economy Since Unification, ed. Gianni Toniolo, Oxford University Press (with Harold James), 37-68 (2013).
“Why the EU Won,” in Integrating Regions: Asia in Comparative Context, ed. Miles Kahler and Andrew MacIntyre, Stanford University Press, 142-169 (2013).
“How housing slumps end,” Economic Policy 27(72), 647-92 (with Agustín Bénétrix and Barry Eichengreen) (2012).
“European Monetary Union in Historical Perspective,” Working Notes 69, 1-8 (2012).
“Commodity Market Disintegration in the Interwar Period,” (with William Hynes and David S. Jacks). European Review of Economic History 16(2), 119-143 (2012).
“War, Trade and Natural Resources: A Historical Perspective,” in The Oxford Handbook of the Economics of Peace and Conflict ed. Michelle Garfinkel and Stergios Skaperdas, Oxford University Press, 557-584 (with Ronald Findlay) (2012).
“Commodity Price Volatility and World Market Integration since 1700.” Review of Economics and Statistics 93(3), 800-813 (with David S. Jacks and Jeffrey G. Williamson) (2011).
“The structure of protection and growth in the late nineteenth century,” Review of Economics and Statistics 93(2), 606-616 (with Sibylle Lehmann) (2011). Appendix 1.
“From Great Depression to Great Credit Crisis: Similarities, Differences, and Lessons,” Economic Policy 25(62), 219-265 (with Miguel Almunia, Agustín Bénétrix, Barry Eichengreen and Gisela Rua) (2010).
ORCID ID: https://orcid.org/0000-0001-6272-2090