Professor Gavin Wright Winter 2000−01

ECONOMICS 116
AMERICAN ECONOMIC HISTORY

This course covers the economic history of the United States from colonial
times to the present. Economics 1 is a firm prerequisite.
Two books have been order for purchase. They are:
Thomas K. McCraw, American Business, 1920−2000 (Harlan Davidson)
David C. Mowery and Nathan Rosenberg, Paths of Innovation (Cambridge U.
Press)
Most of the chapters are assigned, so everyone should buy these books.
A coursepack is available containing all other required (*) readings. All
required and optional readings should also be available on reserve at Meyer
Library.
There will be a final examination and a midterm. Also required is a 10−15
page research paper, making original use of data to address an unsettled
question in American economic history. A one−page plan for the paper is due by
Friday, February 2; the paper itself is due Monday, March 12. The midterm
date is Thursday, February 8. Final exam date is Wednesday, March 21, 8:30−
11:30 AM.
TOPICS AND READINGS
1. Overview: The Historical Approach to Economics (January 9−11)
*Paul A. David, "Understanding the Economics of QWERTY: The Necessity
of History," in W. N. Parker, Economic History and the Modern Economist
*Gavin Wright, "Quantitative Economic History in the United States," photocopy
"Cliometrics After 40 Years," American Economic Review (May 1997),
articles by Claudia Goldin and Avner Greif

2. From Colonial Economy to Independence (January 16−18)

*Daniel Scott Smith, "A Malthusian−Frontier Interpretation of U.S.
Demographic History Before c. 1815," in W. Borah, Urbanization in the
Americas
*David Galenson, "The Rise and Fall of Indentured Servitude: An Economic
Analysis,"
Journal of Economic History 44 (March 1984)
*Pauline Maier, "The Revolutionary Origins of the American Corporation,"
William and
Mary Quarterly (January 1993)
Marc Egnal and Joseph Ernst, "An Economic Interpretation of the American
Revolution," William and Mary Quarterly (January 1972).
3. Transportation Revolution and Market Revolution(January 22−25)
*Daniel B. Klein, "The Voluntary Provision of Public Goods?" Turnpike
Companies of
Early America," Economic Inquiry (October 1990)
*Albert Fishlow, "The Dynamics of Railroad Extension to the West," in
Fogel and Engerman (eds.), The Reinterpretation of American Economic
History
*W. N. Parker, "Productivity Growth in American Grain Farming," in Fogel and
Engerman (eds.), The Reinterpretation of American Economic History
*Paul A. David, "The Mechanization of Reaping in the Ante−Bellum Midwest," in
Fogel and Engerman (eds.), The Reinterpretation of American Economic
History
*Alan L. Olmstead and Paul W. Rhode, "Beyond the Threshold," Journal of
Economic
History 55 (March 1995)
Anne Mayhew, "A Reappraisal of the Causes of Farm Protest," J. Ec. Hist. (June
1972)
4. Slavery and the Southern Economy (January 29−February 1)
*Yasukichi Yasuba, "The Profitability and Viability of Plantation Slavery in
the
United States," in Fogel and Engerman (eds.), Reinterpretation
*Gavin Wright, "Capitalism and Slavery on the Islands: A Lesson from the
Mainland,"
Journal of Interdisciplinary History 1987
David Eltis, "Free and Coerced Transatlantic Migrations: Some Comparisons,"
American
Historical Review 88 (April 1983)
5. The Rise of American Industry to World Pre−Eminence (February 5−7)
*Nathan Rosenberg, "Why in America?" in Otto Mayr and Robert C. Post (eds.),
Yankee
Enterprise (1981)
*Paul A. David and Gavin Wright, "Increasing Returns and the Genesis of
American
Resource Abundance," Industrial and Corporate Change 6 (March 1997)
*Alfred D. Chandler, "The Emergence of Managerial Capitalism," Business
History Review 58 (Winter 1984)
MIDTERM EXAM: Thursday, February 8
6. Labor and Households in the "New Economy " of the 1920s (February 12−15)
*Gavin Wright, "Understanding the Gender Gap: A Review Article,"
Journal of Economic Literature 29 (September 1991)
*Susan B. Carter and Richard Sutch, "Historical Background to Current
Immigration Issues," in James P. Smith and Barry Edmonston (eds.), The
Immigration Debate
*William J. Collins, "When the Tide Turned: Immigration and the Delay of the
Great
Black Migration," Journal of Economic History 57 (September 1997)
*McCraw, American Business, chapters 1−2
*Mowery and Rosenberg, Paths of Innovation, chapters 1−3
7. The Great Depression and the New Deal (February 20−22)
*Eugene White, "The Stock Market Boom and Crash of 1929," Journal of
Economic Perspectives 4 (Spring 1990)
*Martha Olney, "Avoiding Default: The Role of Credit in the Consumption
Collapse of
1930," Quarterly Journal of Economics (February 1999)
*Charles Calomiris, "Financial Factors in the Great Depression,"
Journal of Economic Perspectives 7 (Spring 1993)
*McCraw, American Business, chapters 3−5
8. The Golden Age of American Capitalism (February 26−March 1)
*McCraw, American Business, chapters 6−8
*Mowery and Rosenberg, Paths of Innovation, chapters 4−5
*Gavin Wright, "The Civil Rights Revolution as Economic History," Journal of
Economic History 59 (June 1999)
9. The New High Technology American Economy? (March 5−8)
*Stuart Leslie and Robert Kargon, "Selling Silicon Valley," Bus. Hist.Rev 70
(1996)
*Paul A. David, "The Dynamo and the Computer," Amer. Econ. Review 80 (May
1990)
*Charles W. Calomiris, "Universal Banking ‘American−Style," Journal of
Institutional
and Theoretical Economics (1998)
*Peter Temin, "The Stability of the American Business Elite," Industrial and
Corporate Change 8 (1999): 189−209
*McCraw, American Business, chapters 9−10
*Mowery and Rosenberg, Paths of Innovation, chapter 6
10. End Quarter Period (March 12−18)

Economics 116 Research Term Paper

Winter 2001

Assignment: An original research paper drawing upon historical data to address a question in
American economic history.

Expectations: Your research paper should demonstrate your ability to use economics to interpret
historical observations, and to present a cogent argument. The paper is not intended to be a
literature review, but should contain an original contribution of your own. You are asked to
define a question, to assemble supporting evidence, and to present the data and arguments in an
informative manner. We ask that you present at least one original table and one original graph.
(No photocopies of someone else’s data tables and graphs, and no simple re−creation of a printed
graph or table, please.) You may do more than this, but you should include a verbal explanation
of what you have done and what you think your evidence shows. Your use of the data should be
guided by the economic story you hope to tell.

The most successful economic history papers are organized roughly as follows. First, a question
or puzzle is identified. Second, previous thinking on the issue is briefly discussed. (Again, this is
not a literature review.) Third, a hypothesis is offered to explain the puzzle, preferably using
economic concepts. Fourth, relevant evidence is presented and analyzed. Statistical testing is
encouraged but not required. (Note that relevant evidence may either support or refute a
hypothesis.) Finally, conclusions are drawn.

Length: Your paper should be no more than 15 pages including relevant tables, graphs, figures,
footnotes, appendices, and references. Anything longer will not be read. We ask that you add a
cover sheet with your name, Stanford ID#, paper title and an abstract. (The abstract should be a
one−paragraph summary of your paper’s question and findings.)

Deadlines: On February 5 in class, you should submit a one−page statement including [1] the
topic you have chosen, [2] the question(s) you intend to investigate, and [3] the data source(s)
you intend to use for your paper. Rather than being a perfect prediction of what your research
will find, this assignment is intended to force you to determine your subject area of interest and
the historical trends and/or events you are looking to explain. The final paper is due by 5 p.m.
Monday March 12. No late papers will be accepted.

Please remember that this is a term−length project. Delaying until the last weeks will diminish
your learning experience. Few students can complete a project of this nature successfully in a
short period of time.

Sources:

! The place to begin for statistical data is the two−volume Historical Statistics of the United
States, available on the reference shelves of Green, Government Documents, and Jackson
Business libraries −− and now on CD−ROM at the Green Social Sciences Data Service. These
two volumes contain data and sources on virtually every subject covered in 116. Also useful is
the Statistical Abstract of the United States, available for earlier as well as recent years. For
macroeconomic data, try the annual Economic Report of the President.

! Other sources to consider: The Federal Censuses of the United States (population, manufacturing, agriculture,
social statistics); reports of the Federal Department of Labor and the Bureau of Labor Statistics (as well as state
labor agencies); voting records of the U.S. House of Representatives and Senate in the Congressional Record;
newspapers; consumer catalogs. It is OK to use the Internet, but only valid, authoritative sources that you can cite
precisely. Several useful links may be found in the “Links” section of the course web page. You can also avail
yourself of the many resources in the Stanford Libraries. The librarians are there to help you. Please use them.

Proposed topic areas/ Sample questions:

Below are a few very general topics. Feel free to design your own, but successful papers tend to be on narrowly
focused issues. Remember that it is not just description but analysis that counts for the assignment.

1. Real Wages of US Workers What are real wages? During what periods of US history have real wages risen (or fallen)
most rapidly?

2. Social Welfare Expenditures Have social welfare expenditures risen in real terms, relative to the economy and/or the size
of the government budget? You may want to choose a particular category of spending. What has been the breakdown between
public and private sources?

3. Education What is the history of educational attainment in the US? This may be indexed by literacy rates, enrollment
rates, years of completed schooling, etc. You may want to do "higher education."

4. Immigration Have levels or rates of immigration risen or fallen through time? Compare modern immigration to the era of
mass immigration before WWI.

5. Relative Incomes Has the relative level of income for some ethnic or racial groups been persistently below the average for
the country as a whole?

6. National Debt What is the history of the size of the U.S. national debt, relative to the size of the economy? What does the
debt measure? On the other side of the balance sheet, how have assets changed?

7. Forest Lands and Farm Land Has the country consumed most of its forest land and/or farm land? Or, you may want to
collect and report the trends in production, consumption, or prices of forest products.

8. Petroleum The same questions apply to oil. What is the national record of production, consumption, and/or remaining
reserves of petroleum?

9. R&D What is the record of expenditures on Research and Development in the United States, relative to the size of the
economy, or relative to total expenditures on capital formation?

10. Overworked Americans Do Americans work more or less now than they used to? What is the right way of measuring
lifetime work effort?

11. Unemployment What is the level and composition of unemployment? How has this changed over time?

12.Bank Failures When have large numbers of banks failed in U.S. history? What were the causes and responses?

13. International Trade How has the size and composition of US international trade changed over time, relative to the
economy?

14. Size of Government: Federal, State, and Local

How have these institutions changed in importance over time? One may examine revenues, expenditures, and scope of
activities.