Program meeting on Development of the American Economy.

The NBER's Program on the Development of the American Economy met at the Bureau's Cambridge office on March 7, 1998. Organizers Claudia Goldin, Program Director, also of Harvard University, and John J. Wallis, NBER and University of Maryland, chose the following presenters and topics:

Lee J. Alston, NBER and University of Illinois, and Kyle Kauffman, Wellesley College, "Social Norms of Racial Discrimination and Their Impact on Land Rentals in the U.S. South"

Joshua Rosenbloom, NBER and University of Kansas, and William Sundstrom, Santa Clara University, "The Sources of Regional Variation in the Severity of the Great Depression: Evidence from U.S. Manufacturing, 1919-1937"

Charles Calomiris, NBER and Columbia University, and Berry Wilson, Federal Communications Commission, "Bank Portfolio Risk and Capital: The 1930s Capital Crunch and Scramble to Shed Risk"

Dora Costa, NBER and MIT, "The Unequal Work Day: A Long-term View"

Richard H. Steckel, NBER and Ohio State University, "Tax Records and the Distribution of Wealth, 1820-1910"

At the turn of 20th century, a variety of racially discriminatory laws and norms affecting the behavior of blacks existed in the U.S. South. Alston and Kauffman provide an indirect test of how the southern institutions of discrimination affected market prices. They start from the observation that in 1920 in the U.S. South, black cash renters paid more per acre than did white cash renters within the same county. The explanation for the cash rent differences is not discrimination in the classic sense but rather a reflection of the absence of civil rights for blacks. In the presence of discriminatory laws and practices, black renters were willing to pay "paternalism premiums" for protection from potential abuses.

The severity of the Great Depression in the United States varied by region, especially when measured in terms of employment fluctuations. Most notably, compared with the rest of the country, the south Atlantic states experienced a milder contraction, while the mountain states suffered more severely. The effect of the contraction was more uniform across other regions of the country. Rosenbloom and Sundstrom use data from the biennial Census of Manufactures on 20 individual manufacturing industries disaggregated by state to analyze the relative contributions of industry mix and location to regional variations in economic performance from 1919 to 1937. The authors find that industrial composition had a significant...