The Political Economy of Movement
Friday, Jan. 5, 2018 8:00 AM - 10:00 AM
- Chair: Noel Maurer, George Washington University
Technology adoption and industrial leadership: How Brewing Moved West in the United States
AbstractI study the connection between the invention of new technologies and the rise and incumbency of leaders within an industry. I focus on the rise of Midwestern breweries in the US after the invention of pasteurization in the late nineteenth century. Pasteurization reduced the marginal cost of shipping beer for breweries willing to build bottling plants. Using a brewery-level dataset that I constructed, I show that the endogenous adoption of bottling allowed for the early expansion of breweries that later became leaders in the industry. These breweries were located in the Midwest because of their low transportation costs to nearby markets with weak competitors that were mostly isolated before pasteurization was invented. In the Northeast, breweries were unlikely to adopt bottling and focused on their home markets instead. The early expansion of Midwestern breweries occurred mainly through shipments within the Midwest, as opposed to shipments from the Midwest to the Northeast. My results are consistent with an extension of the endogenous sunk cost framework developed in Sutton (1991, 1997)
The Evolution of Sea-power in History
AbstractThis paper analyzes the dynamics of sea power using the tools of
economics and through the perspective of economic history. Specifically,
we first devise a simple game theoretic approach of two rival naval powers.
As naval technologies advance, making vessels more powerful and more
costly, convergence in naval spending occurs. It also shows how
such convergence can lead to global conflict and the emergence of a single
dominant player, leading to long-run cycles of naval power. We then turn
to newly digitized data for over two dozen navies during one such power
cycle—the late 19th and early 20th centuries. Preliminary empirical results
suggest that the rising importance of inter-continental commerce during
the period contributed to naval arms races around the world, and the
eventual eruption of global war.
The Transformation of Transatlantic Passenger Transportation, 1946-1970
AbstractFrom 1946-1970, airlines completely supplanted steamships in transatlantic passenger transportation. We build a database of passenger flows, ocean and air fares, flight/voyage times, and other key product and consumer attributes. We develop a model of the decision to travel and of mode choice, and we fit parameter values to the observed patterns in the data. We provide a decomposition of the factors that led to airlines replacing steamships. We perform a counterfactual analysis of what would have happened if technological improvements were not accompanied by increasing incomes, and vice versa. More broadly, our work provides a quantitative analysis of how a leading edge producer supersedes a legacy technology through a mix of product innovation, cost reduction and increased consumer ability to pay for a hitherto luxury good.
- N7 - Transport, Trade, Energy, Technology, and Other Services
- R4 - Transportation Economics