1936. Frustrated Hopes: The Great Depression, the Second Republic and the Civil War

The Great Depression was accompanied by the collapse of the monarchical regime and the establishment of a modern democracy with the Second Republic in April 1931. The new regime had to balance the importance of gaining domestic and international respectability (using orthodox fiscal and monetary policy) with efforts to shift towards a moderate protectionist policy, and enact land, labour and educational reforms. There were fierce confrontations from 1934 on, eventually culminating in a civil war in 1936. The consequences included a long-lasting impact on economic growth; autarky and interventionist policies; a huge loss of human capital; poverty and rising inequality; and a 40-year-long dic…

Financial crises in Spain: lessons from the last 150 years

Financial crises are not unique to current financial systems. Are crises alike? Have they become more frequent, longer lasting and more severe since the 20th century? What does history tell us? The objective of this paper is to study the financial crises that have occurred in Spain over the last 150 years. We consider different types of crises (banking, currency and stock market crises), together with all their possible combinations, estimate their frequency by period and measure their length and depth. The main conclusion we obtain is that Spanish crises have been more frequent than in the rest of the world and have been more severe and more complex since 1973, as the 2007 crisis is confir…

Understanding Spanish financial crises severity, 1850–2015

Two Great Banking Crises and Their Economic Impact Compared: Spain 1976/1977 and 2008

The 1976/1977 crisis was the most severe in Spanish history, but the losses associated with the 2008 crisis are huge. This paper compares these two great banking crises and identifies the main parallels and differences between them. Is the current crisis as severe as that of 1976? What is the impact on the banking and financial sectors? We show that the 1976 crisis is being surpassed by the 2008 crisis in terms of the decline in GDP, industrial production and unemployment, and that these two events have had at least a similar impact in terms of output gap and output loss. Finally, the financial impact measured by different financial indicators confirms the greater severity of the 2008 crisi…

Understanding Spanish Financial crises, 1850-2000: What determined their severity?

The objective of this paper is to study the financial crises that have occurred in Spain over the last 150 years. With this objective in mind, the paper has two main purposes. Firstly, we determine the number of crises that took place between 1850 and 2000 considering currency, banking and stock market crises and all their possible combinations and define their depth or severity using different indicators. Secondly, we consider potential factors that could explain the depth or intensity of the crises in Spain. According to our results, each financial crisis has its own particularities and it is very difficult to find common factors in the origin of the Spanish financial crises. Despite this…

CAPITAL FLOW BONANZAS AS A FUNDAMENTAL INGREDIENT IN SPAIN'S FINANCIAL CRISES, 1850-2015

El trabajo analiza los mecanismos a través de los cuales los flujos de capital produjeron inestabilidad financiera en España durante un período de 165 años. Se estudia por qué y cómo las bonanzas de capital hacen que las crisis sean más probables y severas, y si su incidencia varía en función de los tipos de crisis (crisis cambiaria, bancaria y de deuda). Concluimos que la mayoría de ellas se produjeron en diferentes regímenes de política monetaria pero que se asociaron a bonanzas de capital en un marco regulatorio liberal, lo que contribuyó a una mayor probabilidad y a una mayor gravedad de las crisis. El análisis de los diferentes regímenes de política monetaria, las estructuras financier…

Labour market response to globalisation: spain, 1880-1913

Abstract This paper analyses the impact of globalisation (trade and migration) on the Spanish labour market between 1880 and 1913 by examining the influence that globalisation factors had on agricultural and industrial wages. Our results show that the nineteenth century grain invasion had a negative impact on agricultural wages, whereas the fall in wheat prices did not benefit industry workers. We also found that migration pushed up real agricultural and industrial wages. As agriculture was the main sector in the economy, the final impact was a wage decrease. The negative impact of trade on agricultural and industrial labour markets partly explains the trade policy response of “integral pro…

Natural resources, electrification and economic growth from the end of the nineteenth century until World War II

RESUMENLas repercusiones de la nueva rúente de energía, electricidad, en el crecimiento económico de una muestra de países –Estados Unidos, Reino Unido, Francia, Italia, España y Canadá- caracterizados por sus diferentes dotaciones de recursos carboníferos es el principal objetivo de este artículo. La nueva energía, entre otras ventajas, redujo la dependencia de los recursos naturales de carbón al poder generarse a partir de diferentes energías primarias: agua o carbón. Con el fin de valorar la importancia de esta reducción de la dependencia del carbón, se presenta una base de datos de los recursos energéticos para los seis países, se muestra que los precios relativos de la electricidad fre…

Skilled and unskilled wage differentials and economic integration, 1870-1930

In this article we analyse the differences between the wages of skilled and unskilled workers in the period 1870–1930 for five countries with different levels of development and economic integration: the USA, France, the UK, Italy and Spain. We have constructed a ratio of skilled to unskilled wages (the skill premium) in the industrial sector for all these countries with the exception of the USA, for which data were already available. We study the impact of globalisation, technological and structural change and labour movements on the skill premium growth rate. The main conclusion we obtain is that the globalisation variables (migration and trade) explain only part of this growth. Technolog…

Comparing past and present wage inequality in two globalisation periods

Abstract This paper compares past and present globalisation with an aim to highlighting the different factors that drove wage inequality then and those which are doing so now. We have constructed a ratio of wage inequality for 15 countries in the first period of globalisation (1870–1913) and the subsequent period of deglobalisation (1914–1930) and then compare this pattern to wage inequality in the 1980s and 1990s. We propose that the difference in wage inequality trends for the two globalisation periods is due to migration and institutional factors (education and labour market institutions). These factors offset the increase in wage inequality produced by globalisation and technological ch…