Detecting the function of finance through history.

This special review article profiles the work of Joost Jonker, who retires from his chair at the University of Amsterdam in 2021. We situate Joost’s work in the international literature on the financing of governments, businesses and households, showing how his contributions to the field of financial history mirror wider trends. We focus on Joost’s preferred methodology (the analytic narrative) and his preferred theory (the functional perspective). We conclude with a discussion of possible future developments in the field of financial history. Our intention is for this article to become a useful resource for new scholars entering the field of financial history, particularly on topics relating to the Low Countries.

Balancing the Books and Staging Operas under Duress: Bolshoi Theater Management, Wartime Economy and State Sponsorship in 1941–1945

The article examines the financial history of the Bolshoi within USSR’s mobilized wartime cultural industry as an example of a cultural institution highly placed in the Stalinist establishment and symbolic canon. It explores the income-outcome flows, personnel management, the impact of evacuation, notably on Bolshoi’s hard capital, and relations with supervising authorities. The theater’s perceived importance within the war effort conditioned unshakable financial support, a non-market protective environment, and lenient administrative treatment, contrasting with logistical and personnel challenges which the house only partly mastered. This relative stability stands in contrast with the absence of strong leadership, as the director’s position was kept vacant in stark difference to most European opera theaters. The shock of 1941–1942 was absorbed with internal adjustment measures and external subventions, and the Bolshoi’s budgets swelled towards the end of the war, indicating inflation and the house’s “most-favored-opera status”. The stable and conservative management still showed shortcomings, which the state chose not to punish. The opera’s symbolic and prestige capital trumped quantitative efficiency, creating a haven in the war economy.

Thomas Cook(ed): using Altman's z-score analysis to examine predictors of financial bankruptcy in tourism and hospitality businesses

PurposeFinancial bankruptcy is inevitable in the tourism and hospitality ecosystem. Despite the pertinence of tourism and hospitality businesses going into bankruptcy, limited studies have investigated the early warning signs and likelihood of a financial bankruptcy occurring in tourism and hospitality firms. This study examined the predictive value of financial ratios as potential indicators in predicting bankruptcy among tourism and hospitality firms.Design/methodology/approachAltman's z-score bankruptcy prediction model was applied through five key financial ratios to predict bankruptcy of the Thomas Cook Travel Group over a ten year period (2008–2018).FindingsThe key findings of this study strongly suggest that besides the size and location of the firm, financial ratios are reliable predictors and play a pivotal role in predicting the bankruptcy of a tourism and hospitality business.Practical implicationsThe paper provides key stakeholders to adopt checks and balances to identify financial distressed tourism firms through financial ratios.Originality/valueThis is the first academic paper to inspect the financial history of Thomas Cook Travel Group in a financial ratio context, particularly following the bankruptcy of the firm in 2019.

In/Commensurability in Chimerica: An Analysis of China’s Rhetorical Strategies Diplomatic Conflicts with the U.S.

Niall Ferguson (2006), the British economist and author of The Ascent of Money: A Financial History of the World, coined the neologism “Chimerica” to identify the increasingly important and interdependent bilateral relationship between U.S. and China since Beijing emerged as the U.S.’s largest creditor and supplier of goods outside of North America. China’s contemporary cultural orientation draws primarily from Confucianism, a tradition that insists on order and cohesion. This predisposition contrasts sharply with the Aristotelian intellectual tradition of the West, and creates a constant source of friction between the two cultures. As China gains an equal economic footing with the West, and with the U.S. in particular, the sources of incommensurability between these cultures need to be understood more thoroughly to alleviate some of the conflict that would otherwise plague individual, organizational, and governmental communication spanning the two sides. This tension is evident in the editorial pages of the most important news outlets in China and the West. Focusing on selected editorials and drawing on Incommensurability Theory as an analytical framework, this research identifies some of the key cultural defaults, or commonplaces, that the Chinese government uses to guide its rhetorical position in diplomatic conflicts and the cultural roots of these default positions.

In/Commensurability in Chimerica: An Analysis of China’s Rhetorical Strategies Diplomatic Conflicts with the U.S.

Niall Ferguson (2006), the British economist and author of The Ascent of Money: A Financial History of the World, coined the neologism “Chimerica” to identify the increasingly important and interdependent bilateral relationship between U.S. and China since Beijing emerged as the U.S.’s largest creditor and supplier of goods outside of North America. China’s contemporary cultural orientation draws primarily from Confucianism, a tradition that insists on order and cohesion. This predisposition contrasts sharply with the Aristotelian intellectual tradition of the West, and creates a constant source of friction between the two cultures. As China gains an equal economic footing with the West, and with the U.S. in particular, the sources of incommensurability between these cultures need to be understood more thoroughly to alleviate some of the conflict that would otherwise plague individual, organizational, and governmental communication spanning the two sides. This tension is evident in the editorial pages of the most important news outlets in China and the West. Focusing on selected editorials and drawing on Incommensurability Theory as an analytical framework, this research identifies some of the key cultural defaults, or commonplaces, that the Chinese government uses to guide its rhetorical position in diplomatic conflicts and the cultural roots of these default positions.

Financial Deregulation in the United Kingdom

Was there financial deregulation in the United Kingdom in the late twentieth century? There had been several episodes of financial regulation and deregulation in British financial history. Deregulation from the 1820s to the 1870s was followed by a long period of stable and light regulation. That lasted until WWII. After that the trend was upwards. The first statutory banking regulations in more than 150 years were introduced in 1979 and then in 1987. These Acts were accompanied or followed by Basel rules. In the 1990s the Financial Services Authority was established and regulation increased steeply thereafter. The compliance burden rose steadily throughout. Deregulation in these years is hard to find.

„Pénzügy és gazdasági fejlődés hosszú távon” Shin, Yongseok (2018): Finance and Economic Development on the Very Long Run: A Review Essay (Journal of Economic Literature, 56(4), 1557-1586.)1

Yongseok Shin esszéjében Goetzmann Money Changes Everything: How Finance Made Civilizations Possible című könyvéről ír bemutatót, majd a könyv hipotézisét továbbgondolva vizsgálja, vajon az egyes pénzügyi találmányok hatást gyakorolnak-e a hosszú távú gazdasági fejlődésre. Shin Goetzmann művét további gazdaságtörténelmi elemzésekkel is összeveti. Arra a következtetésre jut, hogy a pénzügyek jelenléte fontos összetevő egy jól működő gazdaságban, azonban nem lehet az egyetlen fejlődést előidéző tényező. Shin a pénzügyi történelem további alapos tanulmányozását javasolja, és azt a jelenlegi pénzügyi szektor szabályozásainak kialakítása során is hasznosnak véli. Yongseok Shin reviews Goetzmann’s book, titled Money Changes Everything: How Finance Made Civilizations Possible. He reinterprets its main hypothesis, and analyses how the presence of financial tools affect economic development in the very long run. He also compares Goetzmann’s viewpoint to other economic historians’ results. He concludes that financial advancement is certainly one of the key factors leading to a prosperous economy, but cannot be the single one. Shin argues that financial history lessons might enable us to create more adequate financial regulations.