DOCSLIB.ORG

Risk, Institutions and Growth: Why England and Not China?

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Risk, Institutions and Growth: Why England and Not China? IZA DP No. 5598 Risk, Institutions and Growth: Why England and Not China? Avner Greif Murat Iyigun Diego Sasson March 2011 DISCUSSION PAPER SERIES Forschungsinstitut zur Zukunft der Arbeit Institute for the Study of Labor Risk, Institutions and Growth: Why England and Not China? Avner Greif Stanford University Murat Iyigun University of Colorado and IZA Diego Sasson Goldman Sachs Discussion Paper No. 5598 March 2011 IZA P.O. Box 7240 53072 Bonn Germany Phone: +49-228-3894-0 Fax: +49-228-3894-180 E-mail: [email protected] Any opinions expressed here are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit organization supported by Deutsche Post Foundation. The center is associated with the University of Bonn and offers a stimulating research environment through its international network, workshops and conferences, data service, project support, research visits and doctoral program. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. IZA Discussion Paper No. 5598 March 2011 ABSTRACT Risk, Institutions and Growth: Why England and Not China? We analyze the role of risk-sharing institutions in transitions to modern economies. Transitions requires individual-level risk-taking in pursuing productivity-enhancing activities including using and developing new knowledge. Individual-level, idiosyncratic risk implies that distinct risk-sharing institutions – even those providing the same level of insurance – can lead to different growth trajectories if they differently motivate risk-taking. Historically, risk sharing institutions were selected based on their cultural and institutional compatibility and not their unforeseen growth implications. We simulate our growth model incorporating England’s and China’s distinct pre-modern risk-sharing institutions. The model predicts a transition in England and not China even with equal levels of risk sharing. Under the clan-based Chinese institution, the relatively risk-averse elders had more control over technological choices implying lower risk-taking. Focusing on non-market institutions expands on previous growth- theoretic models to highlight that transitions can transpire even in the absence of exogenous productivity shocks or time-dependent state variables. Recognizing the role of non-market institutions in the growth process bridges the view that transitions are due to luck and the view that transitions are inevitable. Transitions transpire when ‘luck’ creates the conditions under which economic agents find it beneficial to make the choices leading to positive rates of technological change. Luck came in the form of historical processes leading to risk-sharing institutions whose unintended consequences encouraged productivity-enhancing risk-taking. JEL Classification: O10, O31, O43, N10 Keywords: institutions, risk, growth, development Corresponding author: Avner Greif Department of Economics Stanford University Stanford, CA 94305 USA E-mail: [email protected] “Theories of economic growth have failed. These theories are built around a positive rate of technological change, either simply assumed or generated ... by ... assumption.” Robert E. Lucas Jr., 2002, p.110. “Variations in the economic performance across countries (e.g, earlier indus- trialization in England than in China) reflect initial differences in geographical factors and historical accidents and their manifestations in variations in insti- tutional, demographic and cultural factors...” Oded Galor, 2005, Ch. 4. 1Introduction What has led to transitions from pre-modern economies to modern economies? Growth- theoretic models identify two important causes of transition from pre-modern economies to modern ones. In multiple-equilibria growth models, a low-growth economy is a stable equilibrium because decreasing relative risk aversion implies that agents are too risk-averse to choose the modern, high-risk, high-return technology. A transition to a high-growth economy requires exogenous “accidents and good fortune” that disables the low-growth equilibrium (Becker et al., 1990, p. 14) . In ‘endogenous transition’ models, by contrast, low-growth equilibria are unstable and a “transition from stagnation to growth is largely an inevitable outcome of the process of development” (Galor, 2007, p. 472). In particular, time-dependent changes in relative prices, technology, or wealth trigger a transition.1 Both the multiple equilibria and the endogenous transition models have been criti- cized for failing to explain transitions. Multiple-equilibria models invoke accidents (Galor 2005, pp. 176-7) while endogenous transition models "are built around a positive rate of technological change, either simply assumed or generated as an equilibrium outcome by the assumption of [for example] constant or increasing returns to the accumulation of knowledge" (Lucas, 2002, p. 110). This paper theoretically analyzes and historically evaluates endogenous transitions in the absence of accidental changes in wealth or productivity, time-dependent variables, efficient markets, or knowledge of modern technologies. It focuses on how risk-sharing 1 See the review in Galor (2005). For some important contributions to both lines of research, see Kremer (1993), Jones (2001), Galor and Weil (2000), Hansen and Prescott (2002), Gollin, Parente and Rogerson (2002) and Galor (2005). 1 institutions as well as their forms and functions influence individual-level incentives to engage in risky, productivity-enhancing activities. Productivity enhancements require cultivators, producers, and traders to conduct risky experiments.2 Yet, low levels of wealth and decreasing relative risk aversion imply that individual-level risk taking, while socially beneficial, is not likely to be individually rational prior to a transition. Risk- sharing institutions that make risk-taking individually rational can increase productivity and lead to a transition.3 Whether a transition transpires directly depends only on the choice of institutions at the social level and choices about risk-taking at the individual level. We model this argument using an OLG ‘technology transition’ model in which eco- nomic agents choose how to employ their capital.4 An agent’s choice determines the probability of higher future capital productivity. This higher productivity is due to a complex process of the creation of new productivity-enhancing knowledge from which we abstract away. Choosing the ‘traditional’ technology is less likely to generate new knowl- edge but is also less risky. Experimenting is more risky but is more likely to generate new knowledge. This knowledge increases the capital productivity of the agent who discovers it and, once this knowledge spreads, it increases capital productivity more generally. A pre-modern economy is one in which most agents choose the ‘traditional’ technology and the rate of productivity growth is correspondingly low. A modern economy is one where all agents experiment and choose the ‘risky’ technology leading to a high rate of productivity growth. In a transition, the number of agents choosing the risky technology increases over time causing an increase in the rate of productivity growth. Positive externalities imply that agents will employ less capital than socially optimal in the risky technology. Decreasing relative risk aversion implies that poor agents select the traditional technology. If sufficiently many agents are poor, a transition will therefore not transpire and the economy stagnates. A risk-sharing institution can mitigate the impact of low wealth and risk aversion on some agent’s technological choices and initiate an endogenous transition. More specifically, a risk-sharing institution that sufficiently increases risk-taking causes a transition. For reasons discussed below, two institutions that provide the same risk-sharing, can nevertheless have different risk-taking implications. 2 Such risky experimentation was particularly important in the past because the epistemological basis of technology was narrow (Mokyr, 2002). The ability to predict was lower because causal relations were not well understood. Along these lines, Acemoglu and Zilibotti (1997) examine the relations between the indivisibility of risky projects, diversification, and growth. 3 There was, of course, some risk-taking in all pre-modern economies. Some risky activities such as warfare and exploration were taken by those who could pay others to bear the personal cost of failure. Necessity and various means to mitigate risk (particularly in commerce) motivated others to pursue risky ventures. Our model allows – and simulations reveal – some risk taking prior to the transition. 4 Analytically, we focus, without loss of generality, on capital productivity rather than human capital to capture choices with positive externalities (e.g., cultivation techniques). 2 Risk-sharing institutions – in particular,
Load more

Recommended publications
  • An Account by William Radcliffe 1828
    On Power Looms: An Account by William Radcliffe 1828 rom the year 1770 to 1788 a complete change had gradually been effected in the spinning of yarns—that of wool had disappeared altogether, and that of linen was also nearly gone. Cotton, cotton, cotton, was become the almost universal Fmaterial for employment. The hand wheels, with the exception of one establishment were all thrown into lumber-rooms, the yarn was all spun on common jennies, the carding for all numbers, up to 40 hanks in the pound, was done on carding engines; but the finer numbers of 60 to 80 were still carded by hand, it being a general opinion at that time that machine-carding would never answer for fine numbers. In weaving no great alteration had taken place during these 18 years, save the introduction of the fly-shuttle, a change in the woollen looms to fustians and calico, and the linen nearly gone, except the few fabrics in which there was a mixture of cotton. To the best of my recollection there was no increase of looms during this period,—but rather a decrease. Although our family and some others in the neighbourhood during the latter half of the time, earned from three to four fold-wages to what the same families had heretofore done, yet, upon the whole, the district was not much benefited by the change; for what was gained by some families who had the advantage of machinery, might, in a great measure, be said to be lost to the others, who had been compelled to throw their old cards and hand-wheels aside as lumber...
    [Show full text]
  • Neuroeconomics: the Neurobiology of Decision-Making
    Neuroeconomics: The Neurobiology of Decision-Making Ifat Levy Section of Comparative Medicine Department of Neurobiology Interdepartmental Neuroscience Program Yale School of Medicine Harnessing eHealth and Behavioral Economics for HIV Prevention and Treatment April 2012 Overview • Introduction to neuroeconomics • Decision under uncertainty – Brain and behavior – Adolescent behavior – Medical decisions Overview • Introduction to neuroeconomics • Decision under uncertainty – Brain and behavior – Adolescent behavior – Medical decisions Neuroeconomics NeuroscienceNeuronal MentalPsychology states “asEconomics if” models architecture Abstraction Neuroeconomics Behavioral Economics Neuroscience Psychology Economics Abstraction Neuroscience functional MRI VISUAL STIMULUS functional MRI: Blood Oxygenation Level Dependent signals Neural Changes in oxygen Change in activity consumption, blood flow concentration of and blood volume deoxyhemoglobin Change in Signal from each measured point in space at signal each point in time t = 1 t = 2 t = 3 t = 4 t = 5 t = 6 dorsal anterior posterior lateral ventral dorsal anterior medial posterior ventral Anterior The cortex Cingulate Cortex (ACC) Medial Prefrontal Cortex (MPFC) Posterior Cingulate Cortex (PCC) Ventromedial Prefrontal Cortex (vMPFC) Orbitofrontal Cortex (OFC) Sub-cortical structures fMRI signal • Spatial resolution: ~3x3x3mm3 Low • Temporal resolution: ~1-2s Low • Number of voxels: ~150,000 High • Typical signal change: 0.2%-2% Low • Typical noise: more than the signal… High But… • Intact human
    [Show full text]
  • History-Dependent Risk Attitude
    Available online at www.sciencedirect.com ScienceDirect Journal of Economic Theory 157 (2015) 445–477 www.elsevier.com/locate/jet History-dependent risk attitude ∗ David Dillenberger a, , Kareen Rozen b,1 a Department of Economics, University of Pennsylvania, 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297, United States b Department of Economics and the Cowles Foundation for Research in Economics, Yale University, 30 Hillhouse Avenue, New Haven, CT 06511, United States Received 21 June 2014; final version received 17 January 2015; accepted 24 January 2015 Available online 29 January 2015 Abstract We propose a model of history-dependent risk attitude, allowing a decision maker’s risk attitude to be affected by his history of disappointments and elations. The decision maker recursively evaluates compound risks, classifying realizations as disappointing or elating using a threshold rule. We establish equivalence between the model and two cognitive biases: risk attitudes are reinforced by experiences (one is more risk averse after disappointment than after elation) and there is a primacy effect (early outcomes have the greatest impact on risk attitude). In a dynamic asset pricing problem, the model yields volatile, path-dependent prices. © 2015 Elsevier Inc. All rights reserved. JEL classification: D03; D81; D91 Keywords: History-dependent risk attitude; Reinforcement effect; Primacy effect; Dynamic reference dependence * Corresponding author. E-mail addresses: [email protected] (D. Dillenberger), [email protected] (K. Rozen). 1 Rozen thanks the NSF for generous financial support through grant SES-0919955, and the economics departments of Columbia and NYU for their hospitality. http://dx.doi.org/10.1016/j.jet.2015.01.020 0022-0531/© 2015 Elsevier Inc.
    [Show full text]
  • A Measure of Risk Tolerance Based on Economic Theory
    A Measure Of Risk Tolerance Based On Economic Theory Sherman D. Hanna1, Michael S. Gutter 2 and Jessie X. Fan3 Self-reported risk tolerance is a measurement of an individual's willingness to accept risk, making it a valuable tool for financial planners and researchers alike. Prior subjective risk tolerance measures have lacked a rigorous connection to economic theory. This study presents an improved measurement of subjective risk tolerance based on economic theory and discusses its link to relative risk aversion. Results from a web-based survey are presented and compared with results from previous studies using other risk tolerance measurements. The new measure allows for a wider possible range of risk tolerance to be obtained, with important implications for short-term investing. Key words: Risk tolerance, Risk aversion, Economic model Malkiel (1996, p. 401) suggested that the risk an to describe some preliminary patterns of risk tolerance investor should be willing to take or tolerate is related to based on the measure. The results suggest that there is the househ old situation, lifecycle stage, and subjective a wide variation of risk tolerance in people, but no factors. Risk tolerance is commonly used by financial systematic patterns related to gender or age have been planners, and is discussed in financial planning found. textbooks. For instance, Mittra (1995, p. 396) discussed the idea that risk tolerance measurement is usually not Literature Review precise. Most tests use a subjective measure of both There are at least four methods of measuring risk emotional and financial ability of an investor to tolerance: askin g about investment choices, asking a withstand losses.
    [Show full text]
  • Prices and Profits in Cotton Textiles During the Industrial Revolution C
    PRICES AND PROFITS IN COTTON TEXTILES DURING THE INDUSTRIAL REVOLUTION C. Knick Harley PRICES AND PROFITS IN COTTON TEXTILES DURING THE 1 INDUSTRIAL REVOLUTION C. Knick Harley Department of Economics and St. Antony’s College University of Oxford Oxford OX2 6JF UK <[email protected]> Abstract Cotton textile firms led the development of machinery-based industrialization in the Industrial Revolution. This paper presents price and profits data extracted from the accounting records of three cotton firms between the 1770s and the 1820s. The course of prices and profits in cotton textiles illumine the nature of the economic processes at work. Some historians have seen the Industrial Revolution as a Schumpeterian process in which discontinuous technological change created large profits for innovators and succeeding decades were characterized by slow diffusion. Technological secrecy and imperfect capital markets limited expansion of use of the new technology and output expanded as profits were reinvested until eventually the new technology dominated. The evidence here supports a more equilibrium view which the industry expanded rapidly and prices fell in response to technological change. Price and profit evidence indicates that expansion of the industry had led to dramatic price declines by the 1780s and there is no evidence of super profits thereafter. Keywords: Industrial Revolution, cotton textiles, prices, profits. JEL Classification Codes: N63, N83 1 I would like to thank Christine Bies provided able research assistance, participants in the session on cotton textiles for the XII Congress of the International Economic Conference in Madrid, seminars at Cambridge and Oxford and Dr Tim Leung for useful comments.
    [Show full text]
  • Utility with Decreasing Risk Aversion
    144 UTILITY WITH DECREASING RISK AVERSION GARY G. VENTER Abstract Utility theory is discussed as a basis for premium calculation. Desirable features of utility functions are enumerated, including decreasing absolute risk aversion. Examples are given of functions meeting this requirement. Calculating premiums for simplified risk situations is advanced as a step towards selecting a specific utility function. An example of a more typical portfolio pricing problem is included. “The large rattling dice exhilarate me as torrents borne on a precipice flowing in a desert. To the winning player they are tipped with honey, slaying hirri in return by taking away the gambler’s all. Giving serious attention to my advice, play not with dice: pursue agriculture: delight in wealth so acquired.” KAVASHA Rig Veda X.3:5 Avoidance of risk situations has been regarded as prudent throughout history, but individuals with a preference for risk are also known. For many decision makers, the value of different potential levels of wealth is apparently not strictly proportional to the wealth level itself. A mathematical device to treat this is the utility function, which assigns a value to each wealth level. Thus, a 50-50 chance at double or nothing on your wealth level may or may not be felt equivalent to maintaining your present level; however, a 50-50 chance at nothing or the value of wealth that would double your utility (if such a value existed) would be equivalent to maintaining the present level, assuming that the utility of zero wealth is zero. This is more or less by definition, as the utility function is set up to make such comparisons possible.
    [Show full text]
  • Loss Aversion in Decisions Under Risk and the Value of a Symmetric Simplification of Prospect Theory
    1 Loss Aversion in Decisions under Risk and the Value of a Symmetric Simplification of Prospect Theory By Eyal Ert and Ido Erev Max Wertheimer Minerva Center for Cognitive Studies, Technion, Israel Abstract Three studies are presented that examine alternative interpretations of the loss aversion assertion (Kahneman and Tversky (1979)). The first two studies reject a "strong" interpretation: In violations of this interpretation the choice rate of the risky option was higher given prospects with mixed payoffs (gain and losses) than given prospects with nonnegative payoffs. The third study rejects a "moderate" interpretation of loss aversion: It shows that the elimination of the loss aversion assumption from prospect theory increases the theory's predictive value. The results demonstrate the value of a simplified version of prospect theory that assumes a symmetric value function (with diminishing sensitivity relative to the reference point), a symmetric probability weighting function (that implies a certainty/possibility effect) and a stochastic response rule. Keywords: Stochastic models, Cumulative prospect theory, Predictive value. JEL Classification: C91, D01. 2 1. INTRODUCTION The loss aversion assertion, one of the assumptions that underlie prospect theory (Kahneman and Tversky (1979)), implies that losses loom larger than gains. That is, the absolute subjective value of a specific loss is larger than the absolute subjective value of an equivalent gain. This assertion was shown to provide an elegantexplanation to a wide set of important behavioral phenomena. Famous examples are the endowment effect (Kahneman, Knetsch and Thaler (1990)), the status quo bias (Samuelson and Zeckhauser (1988)), and the equity premium puzzle (Benartzi and Thaler (1995)).
    [Show full text]
  • Risk Aversion and Emotions
    bs_bs_banner Pacific Economic Review, 19: 3 (2014) pp. 296–312 doi: 10.1111/1468-0106.12067 RISK AVERSION AND EMOTIONS YEN NGUYEN Tilburg University CHARLES N. NOUSSAIR* Tilburg University Abstract. We consider the relationship between emotions and decision-making under risk. Specifi- cally, we examine the emotional correlates of risk-averse decisions. In our experiment, individuals’ facial expressions are monitored with face reading software, as they are presented with risky lotteries. We then correlate these facial expressions with subsequent decisions in risky choice tasks. We find that a more positive emotional state is positively correlated with greater risk taking. The strength of a number of emotions, including fear, happiness, anger and surprise, is positively correlated with risk aversion. JEL Classification Code: C9 1. INTRODUCTION The mechanisms that underpin choice under risk have been a primary focus of research in economics, psychology and neuroscience. The traditional approach in economics has been to postulate the existence of a utility function, possessing the expected utility property, that represents an individual’s preferences, and to note that concavity implies a preference for relatively safe lotteries, while convexity corresponds to a preference for relatively risky lotteries. Neuroscien- tists have documented the physiological correlates of risky decision-making. Psychologists and behavioural economists stress the role of emotions such as happiness or fear in guiding individuals’ choices in risky situations (see e.g. Forgas, 1995; Loewenstein and Lerner, 2003; Coget et al., 2011). The focus of the work reported here is to better understand the connection between emotions, which are ultimately psychological terms describing profiles of physiological responses, and the level of risk aversion exhibited in financial decision-making tasks.
    [Show full text]
  • Bulletin Vol 46 No3 2016 V4.Pub
    addleworth istorical ociety ulletin Volume 46 Number 3 2016 Bulletin of the Saddleworth Historical Society Volume 46 Number 3 2016 New Additions to the Archives The Family Papers of Joseph Whitehead Johnson of Leeds Mike Buckley 59 A Saddleworth Commemorative Jug Mike Buckley 72 Memory Lane Una Ross 78 Members of my Family who took part in WWII Patricia Foster 83 Obituary Keith Taylor 87 Cover Illustration: Mary Jane Johnson (née Whitehead (c1840-1905) SHS Archive ©2016 Saddleworth Historical Society and individual contributors and creators of images. i ii SHS Bulletin, Vol. 46, No. 3, 2016 NEW ADDITIONS TO THE ARCHIVES The Family Papers of Joseph Whitehead Johnson of Leeds Mike Buckley The Society acquired a collection of deeds and family papers at an auction by Capes Dunn on the 29th November 2016. The lot, which was described as an ‘Interesting Collection of mainly 19th Century ephemera relating to the Whitehead, Buckley and Radcliffe families from the Shaw Hall and Shaw Hall Bank areas of Saddleworth’ turned out to have belonged to the Johnson family of Leeds who, though never having resided in the district, had acquired the bulk of the papers through marriage. The collection is a mixture of wills, deeds and other household documents spanning a century and a half and is a useful example of how deeds and papers belonging to a particular property or family can end up in the most unlikely and unrelated places. The earliest documents belonged to the Buckley family of Shaw Hall Bank. Following the sale of the James Farrer’s manorial estate in 1791, the large Shaw Hall Bank farm was bought by John Buckley of Abels (1704-1795) and three of his sons.
    [Show full text]
  • Monetary Policy, Redistribution, and Risk Premia∗
    Monetary Policy, Redistribution, and Risk Premia∗ Rohan Kekrey Moritz Lenelz September 2019 Abstract We study the transmission of monetary policy through risk premia in a heteroge- neous agent New Keynesian environment. Heterogeneity in agents' marginal propensity to take risk (MPR) summarizes differences in risk aversion, constraints, rules of thumb, background risk, and beliefs relevant for portfolio choice on the margin. An unexpected reduction in the nominal interest rate redistributes to agents with high MPRs, lower- ing risk premia and amplifying the stimulus to the real economy through investment. Quantitatively, this mechanism rationalizes the empirical finding that the stock market response to monetary policy shocks is driven by news about future excess returns. JEL codes: E44, E63, G12 ∗We thank Adrien Auclert, Markus Brunnermeier, Emmanuel Farhi, Zhiguo He, Anil Kashyap, Gita Gopinath, Francois Gourio, Veronica Guerrieri, Erik Hurst, Nobu Kiyotaki, Stefan Nagel, Brent Neiman, Monika Piazzesi, Martin Schneider, Alp Simsek, Ludwig Straub, Gianluca Violante, Ivan Werning, Tom Winberry, and Moto Yogo for discussions. yUniversity of Chicago Booth School of Business. Email: [email protected]. zPrinceton University. Email: [email protected]. 1 Introduction In the data, expansionary monetary policy lowers risk premia. This finding has been es- tablished for the equity premium in stock markets, the term premium on longer maturity nominal bonds, and the external finance premium on risky corporate debt.1 The basic New Keynesian framework as described by Woodford (2003) and Gali (2008) does not capture this aspect of monetary policy transmission. As noted by Kaplan and Violante (2018), this is equally true for an emerging body of heterogeneous agent New Keynesian models whose focus on heterogeneous marginal propensities to consume has substantially enriched the im- plications for aggregate consumption but less so for asset prices and therefore investment.
    [Show full text]
  • Using Lotteries to Finance Public Goods: Theory ∗ and Experimental Evidence
    INTERNATIONAL ECONOMIC REVIEW Vol. 48, No. 3, August 2007 USING LOTTERIES TO FINANCE PUBLIC GOODS: THEORY ∗ AND EXPERIMENTAL EVIDENCE BY ANDREAS LANGE,JOHN A. LIST, AND MICHAEL K. PRICE1 University of Maryland and ZEW; University of Chicago and NBER; and University of Nevada, Reno This study explores the economics of charitable fund-raising. We begin by de- veloping theory that examines the optimal lottery design while explicitly relaxing both risk-neutrality and preference homogeneity assumptions. We test our theory using a battery of experimental treatments and find that our theoretical predic- tions are largely confirmed. Specifically, we find that single- and multiple-prize lotteries dominate the voluntary contribution mechanism both in total dollars raised and the number of contributors attracted. Moreover, we find that the op- timal fund-raising mechanism depends critically on the risk postures of potential contributors and preference heterogeneity. 1. INTRODUCTION A rich literature has developed in the past several decades that systematically examines the supply side of public goods provisioning. Leaders in the field have grappled with the importance of altruism, fairness, reciprocity, inequity aversion, and the like in explaining the behavior of agents in such environments.2 Yet as Andreoni (1998) aptly points out, the demand side of charitable fund-raising re- mains largely unexplored and many critical issues remain unresolved. One line of research that has begun to fill these gaps is the exploration of charitable lot- teries as a means to finance public goods. In an important study, Morgan (2000) shows that lotteries obtain higher levels of public goods provision than a vol- untary contributions mechanism because the lottery rules introduce additional private benefits from contributing.
    [Show full text]
  • The Arkwrights
    THE ARKWRIGHTS The Industrial Re30lution at Stockport and Marple GEORGE UNWIN, M.A., M.Com. ~rofuirof Economic History in the U?lioersity of Manche~ter with Chapters by ARTHUR HULME and GEORGE TAYLOR, M.A. MANCHESTER - - AT THE UNIVERSITY PRESS LONDON, NEW YORK, 8rC. LONGMANS, GREEN & CO. '924 PREFACE Publications of the Utzio~rjityof Manckerter HREE leading contemporary authorities on the No. CLXII. early history of the cotton industry and of the Tfactory system-Robert Owen, William Radcliffe, and John Kennedy-agree in attributing considerable im- portance to the achievements of Samuel Oldknow, who first turned the new spinning inventions to full account by the production of finer cotton fabrics in successful rivalry with the East. In his delightful autobiogl-aptly, Owe11 has told us how, soon after he became an apprentice in Mr. McGuffog's shop at Stamford, Oldknow's British Mull Muslins beean4 to disvlace those of Indian manu- facture and were eagerly bought up by the nobility at half-a-guinea a yard. His subsequent account of Oldknow's beginnings as a master spinner anti of how " the handsonle and imposing mill at Mellor " proved a stumbling block to the ardent young Welshman's earliest ambitions will be found recorded in this book in Owen's inimitable style. This cotton mill. which ~assedinto the hands of the Arkwright family, has destroyed by fire in I 892, and has since that date been a picturesque and interesting ruin. A detached portion, however, lying by the river-side and within a stone's-throw of the residence built bv Oldknow.
    [Show full text]