scholarly journals The Making of a National Currency: Spatial Transaction Costs and Money Market Integration in Spain (1825–1874)

2019 ◽  
Vol 79 (4) ◽  
pp. 1094-1128 ◽  
Author(s):  
Pilar Nogues-Marco ◽  
Alfonso Herranz-Loncán ◽  
Nektarios Aslanidis
Keyword(s):  
Nineteenth Century ◽  
Transaction Costs ◽  
Economic Geography ◽  
Market Integration ◽  
Money Market ◽  
Threshold Autoregression ◽  
Postal Services ◽  
Heterogeneous Behavior ◽  
Autoregression Model ◽  
Market Convergence

This article analyzes the integration of the Spanish money market in the nineteenth century. We use a Band-Threshold Autoregression model of prices of bills-of-exchange in ten cities to measure market convergence and efficiency in 1825–1875. While price gaps generally decreased during the period, progress in efficiency was limited to a small group of cities. We suggest that convergence was associated to the reduction in transaction costs, which started well before the railways through improvements in roads and postal services. By contrast, the heterogeneous behavior of efficiency might be associated to economic geography changes and their effects on monetary leadership.

Railroad Development and Market Integration: The Case of Tsarist Russia

1974 ◽  
Vol 34 (3) ◽  
pp. 529-550 ◽  
Author(s):  
Jacob Metzer
Keyword(s):  
Nineteenth Century ◽  
Development Policy ◽  
Market Integration ◽  
Market Sector

Up until the mid-nineteenth century Russia had an enserfed peasantry, a mere 1,000 or so miles of railways, and a small, almost insignificant market sector. When serfdom was abolished (1861) and the expansion of railroads started to occupy a prominent place in development policy toward the end of the nineteenth century, Russia was launched on a transformation from a state of preindustrial and pre-capitalistic backwardness into a path of modernization and industrialization.

scholarly journals Chandler in a Larger Frame: Markets, Transaction Costs, and Organizational Form in History

2004 ◽  
Vol 5 (3) ◽  
pp. 355-375 ◽  
Author(s):  
Richard N. Langlois
Keyword(s):  
Nineteenth Century ◽  
Transaction Costs ◽  
Organizational Form ◽  
Quarter Century ◽  
Visible Hand ◽  
Decentralized Market

In 1977, when Alfred D. Chandler's pathbreaking book The Visible Hand appeared, the large, vertically integrated, “Chandlerian” corporation had dominated the organizational landscape for nearly a century. In some interpretations, possibly including Chandler's own, The Visible Hand and subsequent works constitute a triumphalist account of the rise of that organizational form: the large, vertically integrated firm arose and prospered because of its inherent superiority, in all times and places, to more decentralized, market-oriented production arrangements. A quarter century later, however, the Chandlerian firm no longer dominates the landscape. It is under siege from a panoply of decentralized and market-like forms that often resemble some of the “inferior” nineteenth-century structures that the managerial enterprise had replaced.

MINIMIZING THE PROBABILITY OF LIFETIME RUIN: TWO RISKLESS ASSETS WITH TRANSACTION COSTS

2019 ◽  
Vol 49 (03) ◽  
pp. 847-883
Author(s):  
Xiaoqing Liang ◽  
Virginia R. Young
Keyword(s):  
Transaction Costs ◽  
Financial Market ◽  
Optimal Investment ◽  
Investment Strategy ◽  
Money Market ◽  
The Other ◽  
Proportional Transaction Costs ◽  
Optimal Investment Strategy ◽  
The Individual ◽  
Riskless Asset

AbstractWe compute the optimal investment strategy for an individual who wishes to minimize her probability of lifetime ruin. The financial market in which she invests consists of two riskless assets. One riskless asset is a money market, and she consumes from that account. The other riskless asset is a bond that earns a higher interest rate than the money market, but buying and selling bonds are subject to proportional transaction costs. We consider the following three cases. (1) The individual is allowed to borrow from both riskless assets; ruin occurs if total imputed wealth reaches zero. Under the optimal strategy, the individual does not sell short the bond. However, she might wish to borrow from the money market to fund her consumption. Thus, in the next two cases, we seek to limit borrowing from that account. (2) We assume that the individual pays a higher rate to borrow than she earns on the money market. (3) The individual is not allowed to borrow from either asset; ruin occurs if both the money market and bond accounts reach zero wealth. We prove that the borrowing rate in case (2) acts as a parameter connecting the two seemingly unrelated cases (1) and (3).

scholarly journals Transaction Costs and Farm-to-Market Linkages in China: Empirical Evidence from Apple Producers

2020 ◽  
Vol 12 (9) ◽  
pp. 82
Author(s):  
Yu Wang ◽  
Lu Han ◽  
Kunda Qi ◽  
Jianyun Hou
Keyword(s):  
Information System ◽  
Transaction Costs ◽  
Empirical Evidence ◽  
Market Integration ◽  
Market Participation ◽  
Proportional Transaction Costs ◽  
Market Linkages ◽  
Monitoring Costs ◽  
Apple Production ◽  
The Impact

Using field surgveyed data from two apple production belts in China, this study estimates the impact of transaction costs on smallholders’ market participation and integration. The analysis is based on an innovative measurement of the transaction costs and a disaggregated analysis of sales, information, negotiation, and monitoring costs. The results reveal that farmers’ market participation levels are mainly determined by the proportional transaction costs and price, while their market integration depends on the fixed transaction costs and price. This suggests that, to lower the transaction costs and enable specialization and market participation, it is necessary to invest in and construct adequate farming infrastructure, update the rural information system, improve the structure of farmer households, and subsidize specialized rural cooperative organizations.

Nonlinear Error Correction Modeling in German Interest Rates / Ein nichtlineares Fehlerkorrekturmodell für die deutsche Zinsstruktur

1999 ◽  
Vol 219 (3-4) ◽  
Author(s):  
Cord Brannolte ◽  
Gerd Hansen ◽  
Jeong-Ryeol Kim
Keyword(s):  
Nonlinear Dynamics ◽  
Interest Rates ◽  
Transaction Costs ◽  
Error Correction ◽  
Term Structure ◽  
Money Market ◽  
Smooth Transition ◽  
Nonlinear Error ◽  
Functional Forms ◽  
Error Correction Modeling

SummaryNonlinear dynamics in the term structure of German interest rates resulting from heterogenous transaction costs in the money market are analysed by means of the smooth transition technique introduced by Granger and Teräsvirta (1993). Tests for linearity, specific functional forms and outliers are performed. Evidence is found indicating that the term structure is somewhat better described as a nonlinear cointegrated model instead of a linear one.

scholarly journals What Determined the Location of Industry in Belgium, 1896–1961?

2015 ◽  
Vol 46 (3) ◽  
pp. 393-419 ◽  
Author(s):  
Stijn Ronsse ◽  
Glenn Rayp
Keyword(s):  
Nineteenth Century ◽  
Twentieth Century ◽  
Economic Geography ◽  
Driving Forces ◽  
Internal Market ◽  
Market Potential ◽  
New Economic Geography ◽  
Ideal Case ◽  
Main Determinant

Belgium was one of the first continental countries to undergo industrialization and develop an extensive transportation infrastructure during the nineteenth century, completing the integration of its internal market by the early twentieth century. As such, the country is an ideal case study of the driving forces behind the decisions that industries made about where to locate. An analysis of factors embedded in both the Heckscher-Ohlin model and the new economic geography indicates that the main determinant of Belgium’s industrial locational pattern between 1896 and 1961 was proximity to regions with a high market potential.

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