Noah Smith on Slavery and Economic Growth

In the long run, most wealth is produced, not plundered. Slavery created bad institutions that inhibited industrialization.

Yesterday I wrote about the response on Twitter to this statement by Noah Smith and said that today I would write about my thoughts on this statement.

In general, I tend to agree with Smith, largely because plunder is not a sufficient condition for economic growth and innovation and investment are. Plunder has existed throughout human history, and for most of human history it did not lead to sustained economic growth. Spain and Portugal did plenty of plundering, and it did not lead to economic growth. Switzerland became rich without much plundering. That said, the economic history of the United States had plenty of both plunder and productivity improvement.

Economists generally define economic growth as increases in real GDP per capita. That simply means that on average people produce more goods and services than they did the year before. There are basically two ways to increase output per person. First, you can give people more resources to work with: more natural resources and more capital. Second, you can figure out ways to get more output from the resources you have: you can create a cotton gin, or a spinning jenny, or ways to refine crude oil into kerosene. Both were at play in American economic growth.

Both the South and the North increased the amount of natural resources through movement to the West. This is probably the most obvious role for plunder in American economic growth: appropriation of land from Native Americans. But growth was not solely attributable to increases in land. Capital increased as well. Capital is anything that has been produced in order to increase production in the future. People most often associate capital with machines and equipment, but roads, ports, and canals are important examples of capital as well. There was a lot of new capital in the North, both public and private. Investment in canals and railroads was more extensive in the North than in the South. There were also more buildings, more mills, more agricultural equipment, etc. But neither the increases in land or capital would have really transformed economic life. Simply increasing the amount of land, the number of sawmills, and the number of spinning wheels and looms would not have led to modern economic growth. The fundamental source of growth was improvement in productivity, coming up with new and better ways to do things. These changes in technology were not just in cotton textiles and railroads and the other things people associate with industrialization. The North was still an agricultural economy and much of the growth came from improvements in crops, livestock and farm machinery, see Olmstead and Rohde’s Creating Abundance and David McClelland’s Sowing Modernity: America’s First Agricultural Revolution .These changes in technology are what made 1900 different than 1800 and 2000 different than 1900. Can they be attributed to the cotton economy of the South?

Cotton accounted for about 4 % of U.S. GDP. That is a lot for one sector of the economy. After all, Fogel estimated that GDP would have only been about 4 % lower in 1890 if you had wiped out all the railroads. The point is that even during the antebellum period the US economy was highly diversified. No one thing could drive growth. Four percent is big, but it does not make slave produced cotton the driving force behind economic growth.

But Baptist’s argument is essentially that cotton provided the stimulus for growth in the North. As I have pointed out previously his attempt at calculating the spillover effects of cotton are nonsense. The biggest problem with them is that he just makes up the numbers, but even if he had produced the numbers through research it doesn’t make any sense to compare them to GDP.

Putting aside Baptist’s nonsense calculation, his argument is actually pretty old and has not stood the test of time. It is essentially the argument that Doug North made in   The Economic Growth of the United States, 1790-1860. It seemed like a reasonable story given the evidence that Doug had collected, but subsequent research generated evidence that contradicted the theory. First, work by a number of economic historians (Gallman, Hutchison and Williamson, and Herbst) found that Doug’s theory tended to underestimate the degree of regional self-sufficiency and overestimate the importance of interregional trade. The evidence did not support the conclusion that cotton was the driving force behind economic growth. Second, much of the work done on early industrialization has emphasized the role of intraregional trade. Much of early industrialization appears to have been directed at local demand not demand from the South or Europe. Notable contributions on this subject were made by  Diane Lindstrom Economic Development in the Philadelphia Region  and more recently by David Meyer Roots of American Industrialization or see his essay on Industrialization in EH.Net’s Encyclopedia.

 Finally, there are reasonable arguments supported by evidence that slavery had a negative effect on long run trends in per capita GDP. The more a region depended on slave labor in the past the lower its per capita income now.

These figures are from the working paper by Nathan Nunn “Slavery, Inequality and Economic Development in the Americas: An Examination of the Engerman-Sokoloff Argument (October 2007). There is no question that slaveholders benefited from slavery, but that does not mean that the economy as a whole was better off as a result of slavery. The evidence generally supports the claim that slavery was associated with institutions that were not conducive to economic growth.

By the way, all of the studies I have mentioned are actual empirical studies. Their authors did the hard work of collecting and analyzing evidence, rather than setting in an office in, for example, Ithaca making up numbers.

Finally, I will note that enslaved people may have made contributions to economic growth that aren’t included in Baptist’s story. The McCormick reaper is one of the most famous innovations in American economic history. McCormick was from Virginia, and, according to at least some accounts, an enslaved blacksmith, Jo Anderson, was instrumental in helping him develop a working reaper.  I think this example actually supports Smith’s view about the negative effects of slavery. The vast majority of enslaved people did not even have this sort of limited opportunity to contribute to the sort of technological innovations that produce economic growth. How much more rapid might economic growth have been if African Americans had the same opportunities as Americans of European descent to exploit their ingenuity? How much more rapid might economic growth be now if African Americans had the same opportunities as others? 

More Obnoxious Nonsense from Ed Baptist

Noah Smith tweeted this today.

 In the long run, most wealth is produced, not plundered. Slavery created bad institutions that inhibited industrialization.

Which prompted the following back and forth on Twitter.

1. Josh Mound ‏@JoshuaMound  4h4 hours ago

Josh Mound Retweeted Noah Smith

@Ed_Baptist The following tweet seems to be almost the polar opposite of one of your book's main args, right?

Josh Mound added,

Noah Smith @Noahpinion

In the long run, most wealth is produced, not plundered. Slavery created bad institutions that inhibited industrialization.

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2. Ed Baptist ‏@Ed_Baptist  4h4 hours ago

@JoshuaMound The emergence of cotton slavery in the US South is pretty highly correlated with the Industrial Revolution.

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3. Josh Mound ‏@JoshuaMound  4h4 hours ago

@Ed_Baptist Right, he goes on to say that b/c North industrialized first it shows slavery was inefficient, which is also opp of your book.

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4. Josh Mound ‏@JoshuaMound  4h4 hours ago

@Ed_Baptist It's a pretty clear case of economists abstract anti-empirical theorizing on historical issues that totally misses actual facts.

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5. Marshall Steinbaum ‏@Econ_Marshall  4h4 hours ago

@JoshuaMound For the record (and as @Ed_Baptist & I have discussed) abstract economic theorizing need not be wrong. http://economics.mit.edu/files/8975 

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6. Ed Baptist ‏@Ed_Baptist  4h4 hours ago

@Econ_Marshall @JoshuaMound agreed! But let's mark our theories to data and analysis.

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10:53 AM - 20 Jan 2016 · Details

The remarkable thing about this is Baptist’s assertions about economists' abstract anti-empirical economic theorizing and the need to “mark our theories to data.” 

This, again, is Baptist’s argument on the economic significance of slavery

In 1836, the total amount of economic activity―the value of all the goods and services produced―in the United States was about $1.5 billion. Of this, the value of the cotton crop itself, total pounds multiplied by average price per pound―$77 million―was about 5 percent of that entire gross domestic product. This percentage might seem small, but after subsistence agriculture, cotton sales were the largest single source of value in the American economy. Even this number, however, barely begins to measure the goods and services directly generated by cotton production. The freight of cotton to Liverpool by sea, insurance and interest paid on commercial credit―all would bring the total to more than $100 million (see Table 4.1).

                Next come the second- order effects that comprised the goods and services necessary to produce cotton. There was the purchase of slaves―perhaps $40 million in 1836 alone, a year that made many memories of long marches forced on stolen people. Then there was the purchase of land, the cost of credit for such purchases, the pork and the corn bought at the river landings, the axes that the slaves used to clear land and the cloth they wore, even the luxury goods and other spending by the slaveholding families. All of that probably added up to about $100 million more.

            Third order effects, the hardest to calculate, included the money spent by millworkers and Illinois hog farmers, the wages paid to steamboat workers, and the revenues yielded by investments made with the profits of the merchants, manufacturers, and slave traders who derived some or all of their income either directly or indirectly from the southwestern fields. These third order effects would also include the dollars spent and spent again in communities where cotton related trades made a significant impact another category of these effects is the value of foreign goods imported on credit  sustained the opposite flow of cotton. All these goods and services might have added up to $200 million. Given the short term of most commercial credit in 1836, each dollar “imported” for cotton would be turned over about twice a year: $400 million. All told more than $600 million, or almost half of the economic activity in the United States in 1836, derived directly or indirectly from cotton produced by the million odd slaves― 6 percent of the total US population―who in that year toiled in labor camps on slavery’s frontier.”

Put aside the fact that he is comparing GDP to things that are not counted in GDP. The really important thing to notice about Baptist’s argument is this

“perhaps $40 million”

“probably added up to about $100 million more”

“might have added up to $200 million.”

These are not estimates based upon examination of historical sources; Baptist simply made the numbers up. Even the one table that he refers to does not actually contain the suggested information. This is the empirical work, the marking to data, that he engages in. Baptist’s argument is supported by neither logic nor evidence. Apparently, Baptist’s supporters have either not actually read the book, or they find this kind of “evidence” persuasive. If you find Baptist persuasive you should probably stop reading this blog.  

Tomorrow, I’ll write about my thoughts on Smith’s initial statement.

New in Business History

The Business History conference has posted the Program for the 2016 Annual Meeting.

There are many interesting looking sessions. For instance

4.D  Reinterpreting Early Twentieth-Century U.S. Financial Markets
Location TBA
     Chair:  Edward Fertik, Yale University
     Discussant:  David Weiman, Barnard College

Leslie Hannah, London School of Economics
Reinterpreting Corporate Finance: Did the U.S. Really Lag Europe Before 1914?

Mary O’Sullivan, Université de Genève
A Failed Revolution: The U.S. Securities Markets, the Call Market, and the Federal Reserve Act

Eric Hilt, Wellesley College, and Carola Frydman, Kellogg School of Management
Investment Banks as Corporate Monitors in the Early Twentieth Century

The last issue of the 2015 volume of Business History Review is out. The editor's note describes the contents

Fleming on Slavery and the Civil War

The History News Network posted a bizarre essay on slavery and the Civil War by Thomas Fleming. I presume that it is based on his book, which, based on his essay, I have no intention of reading. He suggests that he has a new understanding of the causes of the Civil War. He notes that he is 

“ forced to ask – not for the first time – why Americans in general and scholars in particular do not want to look at two solutions to slavery that might have avoided the holocaust we call the Civil War and its aftermath of hate-laden racism. “

The first of these solutions that scholars do not want to look at is compensated emancipation.

Not once but twice Lincoln offered the South millions of dollars if they would agree to gradually free their slaves over the next 40 or 50 years. With smears and sneers of rage the South refused the offer. Why? –

Why? Perhaps it was because the value of slaves on the eve of the Civil War is estimated to be about 3 billion dollars, not several million. It has been estimated that even if the payments had been spread out over twenty years the payments would have tripled the federal budget. See Roger Ransom’s essay at EH.NET for a quick review. The fact that it has been estimated suggests that historians have considered this solution. Fleming seems to be suffering from “If I haven’t read it, it hasn’t been written” syndrome.

I’m not going to go into Fleming’s second solution. The essence of Fleming's argument is that there could be no peaceful emancipation because white people in the South were afraid. Real historians, such as Alan Taylor, have written about this fear, but they did not use it to make statements like

The South’s embrace of slavery was not rooted in greed or a repulsive assumption of racial superiority.

I understand that HNN has a commitment to ideological diversity, but they should also have some commitment to reasonable standards of logic and evidence. Even if one were to make a reasonable case that fear had come to dominate Southern thinking on emancipation during the Antebellum period, how could you argue that slavery was not rooted in greed (profit seeking) and racism: They originally imported African slaves as a humanitarian gesture toward people that they regarded as equals? How exactly does that argument work? 

The Cotton Kings

Brian E. Baker and Barbara Hahn’s new book The Cotton Kings: Capitalism and Corruption in Turn of the Century New York and New Orleans shows that it is possible to put capitalism in the title and still write a good history book. I am not going to write a full review, but I will say that I like the book. I’m not sure they are considered part of the new history of capitalism; if they are, the field has taken a turn in a positive direction. Their objective is not to make any sweeping generalizations about capitalism but to examine how it actually functioned in a particular instance. Their focus is first and foremost on understanding what happened. How did people at the cotton exchanges manipulate prices and why did it matter?

In The Cotton Kings people do things. People create the rules that govern markets, they manipulate the rules of those markets, and they form networks and use courts and legislatures to pursue their goals. Sometimes they create rules that bring great benefits to a small number of people; at other times they create rules that spread the benefits more broadly.

They also did two interesting things in terms of the telling of the story. Historians generally struggle with the tension between telling a story so that historians in their field will appreciate it and telling a story so that others will appreciate it. Stories about business, especially those that involve finance, can be particularly difficult to tell. We can’t all have Selena Gomez get people to pay attention to explanations of financial instruments. Baker and Hahn use two devices to try to ease this tension. The first is that terms regarding markets are highlighted throughout the text and defined in a glossary at the end of the book. The approach provides the necessary information without long interruptions in the story. The second device is to place an essay on sources at the end of the book. The term essay on sources may be a bit misleading; it is not about the primary sources. The essay on sources is actually a historiography. It places the book in the literature for other historians. Typically, this discussion would be at the beginning, telling historians why the book is important. Baker and Hahn try to sell the story on its own merits as an interesting and important chapter in American history. I would have actually liked more discussion of the primary sources and how they were used, but that may just be my preference. I find historians stories about how they write history almost as interesting as the history itself.

Rothman on Slavery and Capitalism

Joshua Rothman has written an essay on the new history of capitalism and slavery. In it he illustrates some of the fundamental problems with the recent work in this area.

First, he perpetuates the misleading historiography that claims the new historians of capitalism have overturned the old orthodoxy that slavery was apart from capitalism, pretending that economic historians had not been making that argument for over a half century.  

Second, although he acknowledges that there have been critics, rather than addressing their claims, he writes them off as a matter of dogma rather than analysis. Evidently it is dogma to oppose inaccurate historiography. And it is dogma to expect a historian not to make up evidence. I am willing to say that I subscribe to this dogma.

Yet, as Rothman points out, this work seems to appeal to many people. It seems particularly timely as people worry about the ongoing effects of financial crises, increasing inequality and racial discrimination. This appeal is in some ways the most fundamental problem with the new history of capitalism. “Like my book because I claim that capitalism was the driving force behind the brutality of slavery.” “Like my book because it shows that slavery was the driving force behind American economic growth.” Numerous fans of Baptist’s book have observed that he showed that slave grown cotton accounted for half of economic activity in 1836. But anyone no one who actually reads pages 321 and 322 can fail to see that the numbers are made up and then aggregated in ways that make no sense. People have, however, chosen to overlook that if they like the conclusion. And this is the most fundamental problem: people evaluating someone’s work based upon how well it fits their preconceptions rather than the actual quality of the work. 

Some Economic History Links

Bob Higgs on Doug North

The list of papers being presented at Clio sessions at ASSA.

Sheilagh Ogilivie on the Champagne fairs.

Michalopoulos and Papaioannou on the effects of the “Scramble for Africa”

Since My Last Post

The end of the semester has kept me away from this blog for a while. Once grading was done, Mary and I went up to Mercatus to see Eric Chaney present his research on “Religion and the rise and Fall of Islamic Science” at the Washington Area Economic History Seminar. Here is the version of the paper available on his page at Harvard.

We also went up to Philadelphia for a couple of days. We had dinner at our favorite restaurant, Pumpkin, and at Fork, which was also very good. While I’m at it, we usually stay at the Palomar and have breakfast at Schlesinger’s

Also went to the Art Museum this is my favorite thing there.

In the world of economic history

There is a new Chinese Economic History blog. Among other things, it has a number of interesting interviews.

In addition to the usual collection of interesting papers Journal of Economic History has four essays on the future of economic history.

Bakker, Crafts and Woltjer put out a new working paper  “A vision of the Growth Process in a Technologically Progressive Economy: the United States, 1899-1941.”

“Abstract

We develop new aggregate and sectoral Total Factor Productivity (T FP ) estimates for the United States between 1899 and1941 through better coverage of sectors and better measured labor quality, and show TFP –growth was lower than previously thought, broadly based a cross sectors, strongly variant intertemporally, and consistent with many diverse sources of innovation. We then test and reject three prominent claims. First, the 1930s did not have the highest TFP –growth of the twentieth century. Second, TFP –growth was not predominantly caused by four leading sectors. Third, TFP –growth was not caused by a ‘yeast process’ originating in a dominant technology such as electricity.”

Historians on Edward Baptist

Al Zambone and Bob Elder discuss the book on the podcast Historically Thinking.

Trevor Burnard discusses Baptist’s responses to his critics. Burnard writes that “repeatedly, Baptist puts himself up as the authority on slave testimony; places himself as the judge of what is contained in slave testimony, and suggests that all of his critics are deficient because they don’t take slave testimony as seriously as he does.”

I tried to explain Baptist’s position to someone by pointing out that he seems to believe he speaks for the enslaved the way the Lorax speaks for the trees. The only difference is that the trees did not speak, the enslaved did.

More on Doug North

I don’t think anyone has yet mentioned Doug’s influence on the teaching of economics. The Economics of Public Issues (19^th edition) is still in print, though the first edition is still, in my opinion, the best. Like all successful entrepreneurs North and Miller attracted competitors and influenced the way material is presented in standard textbooks. Doug told me it sold enough to put three sons through Stanford. The book came about as a result of his returning to teaching principles of economics after several years of not having done so.   He finished his lecture on perfect competition with some reference to agricultural markets and asked if there were any questions. A student stood up in the back of the lecture hall. Doug asked him what his question was and the student said “That’s bullshit.” Doug said if you’re so smart why don’t you tell us all about it. Turned out the guy grew up on a farm in Eastern Washington and knew all about how the government interfered with agricultural markets. Doug said he knew that he couldn’t keep giving textbook lectures, but he didn’t know what he should do. He had been working with the Seattle City Council and began his next class with a statement about how many rapes and murders the council had voted to allow, illustrating the consequences of choices about how to allocate spending in the city. Doug ended up writing stories about the economics of crime, abortion, baseball, marijuana etc. He said it was Roger Le Roy Miller’s idea to turn these stories into a book. It sold so well as a textbook that they tried to sell a trade version called Abortion, Baseball and Weed. It bombed; people weren’t ready for freakonomics yet.

I also wanted to note that a couple of couple of places (e.g. NY Times) have mentioned that Doug’s father dropped out of school to become an office messenger. What they did not mention was that his father went on to become vice-president of Metropolitan Life Insurance Company. Doug’s uncle, his father’s younger brother, eventually became the president of Metropolitan Life Insurance Company. I had the impression that he was quite proud of his father. He said that his father was always the one to give the speech when they wanted to get the agents fired up. Doug’s dissertation was a pretty traditional economic history of the life insurance business, with a focus on the Armstrong Investigation. I seem to recall that he said his family was not particularly pleased with his essentially airing the family’s dirty laundry.

Here are some tributes to Doug by people who knew him well

Yoram Barzel remembers Doug at University of Washington

John Nye has both a personal reflection and a review of Doug’s contribution to economics.

John Wallis provides a really good review of Doug’s contributions to social sciences.

Barry Weingast’s tribute to Doug is my favorite so far. As soon as I saw the quote beginning with “Listen, Bub” I could heard Doug’s voice.

Just Listen

In response to this Huffington Post article Jaci Evan's (a former student of mine who is about to finish her  Ph. D. at U. of Maryland) wrote this on Facebook.  Please listen to her.


"There are so many things I could write here that it's hard to choose. But I think I'll say this: I still remember the first time an adult man made me feel sexualized and unsafe. I was 12. That memory has stuck with me to this day, and it was the first of a countless number of times that it has happened since. So when your girlfriend says that your neighbor's behavior makes her feel unsafe, don't say you think it sounds normal, just listen. When she says she doesn't think she'd enjoy travelling to that country known for men who grope women on the subway or cat-call on the streets, don't tell her she's being too sensitive about it, just listen. When she gets upset about those "good old boy" songs involving rape that so many frats get in trouble for these days, don't tell her that they don't really mean it, just listen. Your reality isn't hers, and her thoughts are valid. They come from horrific experiences in her past and in her knowledge of horrific experiences in her friends' pasts. Just listen."

Doug North

My friend Tawni Hunt Ferrarini told me this morning that Doug North passed away last night. Douglass C. North was, of course, a Nobel Memorial Prize winner in Economics. I first, discovered his work while I was a graduate student in economic history at the London School of Economics in 1984-85. I read “A Framework for Analyzing the State in Economic History” published in a special issue of Explorations in Economic History dedicated to his dissertation adviser M.M. Knight. I still love the way he used such a simple model to think about such a complicated problem. When I decided to go back to graduate school to pursue a Ph.D. in economics, I wanted to study with him. I became his research assistant and he was the chair of my dissertation committee. He was everything I had hoped for as a professor and more than I could have imagined as a human being. I felt like I had won the lottery. I still feel that way.

I wanted to write about what he meant to me, both intellectually and as a friend, but I can’t. Maybe another day I will, but not today. 

Coase on Lighthouses and Economics

Earlier this week Daniel Shestakov noted the publication of a new paper on lighthouses by Erik Lindberg. He and I then had a brief exchange on twitter about whether or not the work since Coase’s (1974) paper had supported or contradicted his contentions. It got me thinking that maybe I had missed something in the more recent work. I went back and looked at some of the papers. I’m still not entirely certain what Shestakov’s position is, but it seemed to me that he was claiming that recent work had supported the theorists rather than Coase. I still don’t see it that way.  Theory suggests that if a good is non-rival and non-excludable that there will be a free rider problem and that the outcome will be inefficient in the sense that it will not maximize the sum of consumer and producer surplus. Coase did not set out to refute the theory. He simply argued that it did not necessarily apply in the case of a commonly used example: the lighthouse. The extent to which a good is non -rival and non-excludable is an empirical question. Coase argued that in some cases lighthouses were not in fact non-excludable. In some cases it is not prohibitively costly to charge the users for the service. It seems to me that recent work has not refuted this claim.

My interpretation of Coase’s paper is that it was really much more about economic methods than it was about lighthouses or public goods. The paper was about the way that economists like Samuelson didn’t bother to study the history of lighthouses before using them as an example of a public good. The primary claim of the paper was that the theory of public goods did not necessarily apply to lighthouses because in some cases it was possible to make the people who used the lighthouse pay for the service provided. Specifically, it was possible to identify which lighthouses a ship had benefited from and charge them accordingly at the time they docked. Coase described the finance and operation of private lighthouses as follows:

It was, for instance, much like a private toll bridge. Coase may actually overstate the extent to which the government set price distinguished the case of lighthouses from most goods. He was clearly aware of the extensive role of government in the provision of lighthouses, and he made no effort to hide this from his readers. Coase, however, characterized the government’s involvement as being not substantially different than the provision of other goods by private companies:

Responses to Coase’s paper seem to fall into two categories.

1.      

Government was extensively involved in the so called private lighthouses. Therefore, the lighthouses were not as private as Coase suggested. It has even suggested that it is ironic that Coase chided other economists for not getting their facts straight and then failed to do so himself.

2.       Coase’s speculation about the relative efficiency of private provision is unsupported by the evidence.

Van Zandt (1993) falls into the first category. Van Zandt, however, does not seem to disagree with Coase’s description of the finance and operation of lighthouses. Instead, he disagrees with the interpretation. His primary argument is that the “public” versus “private” dichotomy is not very useful. Coase seems to have agreed with Van Zandt in so far as Van Zandt notes that Coase suggested that there may be an even wider variety of institutional arrangements than he considers.

Bertrand (2006) agrees with Van Zandt that there was extensive involvement of the government in the so-called private lighthouses. She claims at one point that “We have thus shown that Coase, in his account of the English lighthouse system, underestimates the importance of government, and conversely overestimates the appropriateness of individual initiative (Bertrand 400).” But like Van Zandt she has not actually shown that the lighthouses were financed and operated differently than Coase described. People obtained charters from the government, which set the fees and was sometimes directly involved in the collection of these fees. But Coase said all of that. He never suggested that the government was not at involved. He never even suggested that it was not extensively involved.

Bertrand also argues that Coase overestimated the efficiency of the private lighthouses. The problem here is that Coase’s argument wasn’t about the relative efficiency of the private versus public provision. He did little more than speculate about them in the conclusion of the paper, and suggest that more research needed to be done.

Finally, Lindberg (2015) adds a comparative perspective as well as details about the amount of fees collected. Perhaps, most importantly, I think he moves in the direction originally suggested by Coase. He analyzes the actual lighthouse systems that existed in different places and times to try to understand what might explain the differences in institutional arrangements.

More on economic history

I forgot to add this to the post about new papers on economic history

Ran Abramitzky Economics and the Modern Economic Historian (ungated version here)

economics of open access

The Chronicle of Higher Education has an interesting article on open access publishing. It notes what many open access advocates don't. Publishing, even online, requires resources, which costs money, which some has to provide.

One of the benefits of the traditional publishing model is that the customer, libraries, associations, and individual subscribers, paid. Consequently, journal editors had an incentive to provide a product that people were willing to buy.

In contrast many open access publishers charge a publication fee to the author. Unfortunately, this scheme does not create incentives to publish good papers. The publisher does not get compensated unless they  publish the paper. While there are some legitimate open access publishers that charge a publication fee, many unethical entrepreneurs have stepped into the field to publish anything as long as they get paid. See Beall's list for some sense of how many there are. These publishers have an incentive to publish any crap as long as they get paid because they know that no one is going to read, let alone pay for, The International Journal of Business and Social Research or World Journal of Social Sciences.

I have had people try to defend the pay to publish model by saying that a lot of good journals charge fees. Those good journals charge submission fees. The incentives created by submission fees are exactly the opposite of those created by a publication fee. Submission fees encourage authors not to submit crap. Publication fees encourage journals to publish crap. They don't get paid if they don't publish the paper.

I'm not opposed to open access, and I certainly don't support Elsevier, but I don't like it when people champion open access without regard to the consequences.

Recent papers about economic history

Naomi Lamoreaux “Beyond the Old and the New: Economic History in the United States”

Claude Diebolt and Mike Haupert Clio’s Contributions to Economics and History

Isn't this what we are supposed to do?

Pseudoerasmus recently posted an analysis of the issues involved in the slave productivity debate. He also sent me a link to an interesting discussion between Edward Baptist and Trevon Logan on Twitter. I had previously noted Logan's review of Baptist's book in the JEH, which should be mandatory reading for anyone starting work in American history, economic or otherwise. I looked at some related tweets and saw that at one point Baptist wondered who his critics were and what motivated them. He seemed bothered by the anonymity of Pseudoerasmus. I've heard that Alexander Hamilton and William Sealy Gosset published some interesting stuff under pseudonyms. Anyone who wants to know more about who I am can click on the link to my CV in the upper right hand corner. I know John Clegg is a historical sociologist at NYU. I don’t know anything more about him. Pseudoerasmus is an anonymous blogger.   I don’t know who he is, and I don’t care. I evaluate what he writes, not who I think he is. I also don’t know anything about Edward Baptist other than what he writes. For all I know he might be a great guy. He may donate to the food bank and volunteer at the homeless shelter. I wouldn’t be surprised to hear he does both. I haven’t written about who he is, I’ve written my responses to things he has written.

As for the question of motivation, isn’t this what we are supposed to do? One person makes an argument: they state a claim and try to support it with logic and evidence. Other people respond to it. If they think the argument is wrong they say so and explain their reasoning. In Time on the Cross, Fogel and Engerman stated their theses, their reasoning and their evidence. Many economists and historians pointed out errors in all three. To the best of my knowledge, they did not ask what is motivating these guys; they (and their students) went looking for more evidence. 

When I was at Washington University I worked with Doug North (be the way yesterday was Doug’s birthday). Over a very long career, Doug was wrong more than a few times. For example, the central thesis of Economic Growth of the United States does not seem to have been supported by subsequent research. He once told me that the only real benefit of getting older was that he had learned a lot of things that did not work. Doug always seemed to be much more concerned about what he was going to do than with what he had done. Again, he once told me that his aim was to correct his errors before others did. In our economic history seminars we did not sit around telling each other how wonderful we were. My recollection is that people tried to find every potential flaw. I once asked John Nye if he hadn't been awfully hard on someone (not me). John said, "He's a big boy."

So, I don’t understand this question about the identity of critics or their motivation. It doesn’t matter who I am. It matters what I write. I do it because it’s what I am supposed to do.   Edward Baptist wrote a book related to American economic history. My primary field is American economic history. The book was getting a lot of attention, and I thought it was seriously flawed. I wrote about those flaws.

More and more capitalism and slavery

Now Baptist responds to Clegg at the Junto. Have I ever mentioned that the Junto is one of the best blogs out there. I think I have. I find Baptist's response to be about as well reasoned and persuasive as his other work.