Capture or agreement? Why Spanish banking was regulated under the Franco regime, 1939–75

The effect of enriching milk-based beverages with plant sterols or stanols on the fatty acid composition of the products

Five plant sterol (PS)-enriched dairy products from the Spanish market were characterised for fatty acids (FA), volatile compounds and lipid stability. The ingredients used for PS enrichment by the food industry may come from different sources, thus influencing the composition and stability of the lipid fraction. In this study, the FA profile proved highly variable among samples, not agreeing with the nutritional labelling of the products. The volatile profile was characterised. A total of 55 volatile compounds were identified in the samples by GC–MS. Concentrations of hexanal (from 1.1 to 7.5 ng/g), nonanal (from 0.9 to 1.2 ng/g) and decane (from n.d. to 11.9 ng/g) indicated a low lipid ox…

How local conditions affect global banking: the case of BBVA and Santander

This paper explores why Spanish banks internationalize and why Latin America has been the main region for the international expansion of BBVA and Santander. It shows that prior to 1986 Spanish banks had a limited presence abroad, and analyses the main drivers of this initial expansion (remittances and trade connections). However, from 1986 on, there was a confluence of domestic and external factors (economic and regulatory changes in Latin America) that encouraged the international forays of BBVA and Santander. The fact that changes in the Spanish and Latin American financial sectors occurred just when other transnational banks were turning their attention to other regions created the optim…

Financial crises in historical perspective: Parallels between the past and present

The outbreak of the financial crisis in 2007 has increased the interest in the study of financial history and, mainly, from compared studies on international financial crises. To this end, Investigaciones de Historia Economica-Economic History Research has set out to publish a special issue, welcoming the research on past financial crises into its pages. This issue consists of five papers, summarized in this introduction, that revolve around three large topics: the significance of sources and their use to understand the origin of financial crisis as well as their regulatory consequences; comparisons between major crises, and the study of financial crises’ causes and the measures taken to ri…

1977: Hopes Fulfilled—Building Democracy in Turbulent Economic Times

This chapter offers an analysis of the main economic and institutional transformations in Spain from 1977 onwards. The severe economic and financial crisis that hit Spain in the mid-1970s coincided with the arrival of democracy after Franco’s death and shaped the nature and scope of the implemented reforms (Pactos de la Moncloa). While the crisis and political instability limited the possibility of making a more radical adjustment, the consensus among different social actors, unions and political parties was fundamental to the reforms. This time hopes were fulfilled and although some reforms were left pending, those that were adopted played a seminal role in putting the Spanish economy and …

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…

War and economics: Spanish civil war finances revisited

This paper reviews how the Spanish civil war was financed. We present new evidence to show that the two combatant parties, the Republican government and the Franco administration followed similar financial strategies. In both cases money creation, rather than new taxes or the issue of debt, was the main mechanism used to cover the expenses of the war. We argue, contrary to the established knowledge, that both sides consumed a similar amount of domestic and foreign resources. We also argue that the Spanish Republic did not lose the war because of a lack of means. International factors, such as the Non-Intervention agreement promoted by France and Great Britain, and the military setbacks of t…

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…

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…

1959: The Stabilization Plan and the End of Autarky

This chapter analyses the contribution of the 1959 Plan de Estabilizacion (Stabilization Plan) to the economic changes that occurred in Spain during the 1960s. Economic growth improved in the 1950s after a decade of stagnation, but it was autarkic growth and the country accumulated serious imbalances. By reducing interventionism, initiating a process of liberalization and creating an appropriate economic framework, after two decades of autarky, the Plan contributed to promoting economic growth and helped change attitudes and mentalities. Moreover, the Plan had a long-term impact by allowing Spain to take advantage of a favourable international context during the 1960s. However, the dictator…

John A. Consiglio Juan C. Martinez Oliva Gabriel Tortella, eds. Banking and Finance in the Mediterranean: A Historical Perspective. Burlington, VT: Ashgate Publishing, 2012. 352 pp. ISBN 978-1-4094-2984-5, $124.95 (hardcover); 978-1-4094-2985-2 (e-book).

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…