I Carried On Walking

This is an archived version of the PW Sources newsletter from Saturday, January 20, 2024. Sign up to receive PW Sources directly to your inbox here.

CORPORATE LAW

Because of their ability to own property, enter into contracts, and stand in court independently of their owners, charted corporations facilitated the long term capital commitment that often underpinned industrialization. Standard accounts hold that states primarily contributed to the rise of the corporate form by credibly constraining their own use of power.

In a recent article, TAISU ZHANG and JOHN MORLEY challenge this narrative, arguing that the geographical reach, coercive force, administrative power, and legal capacity characteristic of modern states were indispensable to the appearance of the business corporation.

From the text:

“The late imperial Chinese economy met all of the primary conditions that scholars have previously identified as necessary for the rise of the business corporation: there was robust long-distance trade both within the empire and with foreign parties, and there was ample credible commitment from the state not to expropriate. Despite these favorable conditions, the legal technologies of asset partitioning and share transferability did not emerge in any significant way. Instead, Chinese firms, through the end of the nineteenth century, tended to be full-liability partnerships with no robust asset partitioning in either direction and, therefore, very little free transferability of shares. The pace of incorporation picked up considerably after 1929, when the Nationalist government issued a new Corporations Law. By 1949, there were some 11,000 corporations operating across the country, over forty percent of which were in capital-intensive industries. What changed? The issuance of a new Corporations Law may have had some impact on investor confidence, but much more importantly, the new regime also embarked on a series of state-building projects that significantly enhanced its socioeconomic control. In other words, the state strengthened its ability to enforce corporation law.”

+  From 2017, Giuseppe Dari-Mattiacci, Oscar Gelderblom, Joost Jonker, and Enrico C. Perotti examine the influence of corporate law on colonial trade in the Dutch and British East Indian Companies. Link.

+  “Nonprofit groups advocating social and political change rarely met the requirements necessary to obtain a corporate charter.” Ruth Bloch and Naomi Lamoreaux on incorporation and political mobilization in the nineteenth-century US. Link.

+  A 1991 book by Thomas Owen “analyses the legal framework imposed on corporations by the imperial Russian Government” and considers their implications for the “development of capitalism on the eastern periphery of Europe.” Link. And a 1995 article by Katharina Pistor assesses the role of corporate law in late twentieth-century Russian privatization. 

NEW RESEARCHERS

Collective Agriculture

In a co-authored paper, PhD candidate in economics at UC Berkeley OLIVER KIM uses satellite imagery to analyze grain yields during China’s transition to decollectivized agriculture in 1978. 

From the abstract:

“We study one of the central reforms in China’s economic miracle, the Household Responsibility System (HRS), which decollectivized agriculture starting in 1978. The HRS is commonly seen as having significantly boosted agricultural productivity—but this conclusion rests on unreliable official data. We use historical satellite imagery to generate new measurements of grain yield, independent of official Chinese statistics. Using two separate empirical designs that exploit the staggered rollout of the HRS across provinces and counties, we find no causal evidence that areas that adopted the HRS sooner experienced faster grain yield growth. These results challenge our conventional understanding of decollectivization, land reform, and the origins of the Chinese miracle.” 

+   “Keynesian wage-led growth has been replaced with trickle-down economics, with poor prospects for growth and redistribution. What went wrong?” New on PW, Kangkook Lee on South Korea’s growth models. Link

+   “Japan has contributed the highest amount of foreign aid and has become the largest donor to Bangladesh since the late 1980s.” By Md. Jahangir Alam and Md. Saifullah Akon. Link

+   Kubra M. Altaytas on the privatization of Turkey’s sugar industry. Link

+   A new paper on the supply, demand, and polarization challenges that could determine the implementation of the Inflation Reduction Act. Link

+   “The recent fervour surrounding the Bihar caste census serves as a reminder of the ongoing struggle between electoral concerns and actual attempts by the state to ameliorate social inequities.” Noel Mariam George on a caste census in India. Link

+   Sharat Ganapati on the growth of “superstar” wholesalers in the US. Link.  

+   Benjamin Braun on the ECB’s newly-released distributional wealth accounts. Link.

+   “Amidst the ongoing economic turmoil in Syria, characterized by rampant inflation and the devaluation of the lira, it has become more lucrative for top-tier industrialists and merchants to invest in illicit sectors.” Fidaa Itani on the shadow economy in Syria and Lebanon. Link

+   “Massive immigration that commenced in the 1880s drove policy makers to take quick action to modernize conscription (systems of both obligatory and voluntary military service had existed since colonial times) into a tool to integrate the sons and grandsons of immigrants into the national fabric by fostering a common social and political understanding of what it meant to be Argentine. Extremely low rates of naturalization by immigrants, around 2 percent in 1914, and the parallel rise of anarcho-syndicalism as an essential feature of working-class life, added urgency to this project. Indeed, as Omar Acha notes, the golden years of anarchism coincided with the ‘unfolding of a nationalizing strategy by the state.’ The 1901 conscription law, rendered more effective by 1911 registration legislation, developed into one of Argentina’s most vivid, widespread, and concrete manifestations of nation-building.” By Jonathan Ablard. Link

Each week we highlight research from a graduate student, postdoc, or early-career professor. Send us recommendations: editorial@jainfamilyinstitute.org

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