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Marriott Marquis, Malibu City
Economic History Association
Political Economy in Historical Perspective
Friday, Jan. 3, 2020 12:30 PM - 2:15 PM (PDT)
- Chair: Michael Haupert, University of Wisconsin-La Crosse
Political Legacy of Dictatorial Development Policy: Evidence from South Korea
AbstractDid a nation-wide rural development program under a dictatorial regime have long-term political consequences? We investigate the political impacts of the cash transfers during the Park Chung-hee regime’s successful rural development policy in the 1970s in South Korea. For empirical analysis, we digitize novel micro- data on rural cash transfers from administrative records in the 1970s. We also construct township-level election outcome data ranging from the 1970s and up to 2010s. We show that rural towns that received more cash transfers in the 1970s voted more for the authoritarian incumbent party in the next legislative election. We also find that the effect did not spill over to an election held by the next dictator, Chun Doo-hwan after Park’s assassination in 1979. Lastly, we show that the dictator-specific political effect of an authoritarian developmental program persisted forty years later through the 2012 presidential election for Park Geun-hye, the daughter of Park Chung-hee.
The Value of Cronyism: Insider Trading in the Teapot Dome Affair
AbstractThe Teapot Dome affair received perhaps the most media coverage of any of the scandals surrounding the Harding administration of the early 1920s. The affair’s unraveling exposed the bribery of a government official by two oil industry moguls for the illegal leasing of federal naval oil lands. Using weekly stock price data and employing an event study framework, we evaluate the price effects of eight of the episode’s most crucial events on one of the implicated firms and several other firms leading the oil industry. We find that, in all but one case, private information of these eight developments was incorporated into stock prices in advance of news arrival to the public. Our results suggest that, preceding the regulation of insider trading via the passage of the Securities Exchange Act of 1934, American capital markets in the early 1920s held a relatively strong form of market efficiency.
Sumner La Croix,
University of Hawaii
Federal Reserve Bank of Chicago
Louisiana State University
- N4 - Government, War, Law, International Relations, and Regulation
- H1 - Structure and Scope of Government