The end of the Spanish Civil War paved the way for a new regime in Spain, where autarky, interventionism and isolation from the international market were the most significant characteristics of economic policy. During the 1940s there was a fall in the standard of living of the Spanish population and in levels of national income. The 1935 per caput income was not recovered until the 1950s. Autarky also meant that the Spanish economy was isolated from abroad, with the entry of foreign capital denied. The Spanish Institute for Exchange Control (IEME) was created, which controlled the buying and selling of foreign currency. Any international transaction and payment had to have the Institute's authorization and concession of the corresponding foreign currency. By the late 1940s the autarkic model had collapsed, Spain's economic situation had become unsustainable and was further aggravated by international isolation. This situation started to undergo modifications in 1947 with changes in international policy, the start of the Cold War and the American administration's interest in having closer relations with the Franco regime. Changes to the policy of autarky began with a government reshuffle in 1951 and with the signing of the Treaty of Madrid with the US in 1953.

As far as the insurance sector was concerned, and in fact all other economic sectors as well, the end of the Civil War and the establishment of the Franco dictatorship led to significant changes.

I: England in the 1540s

In the introduction to my Handbook of Medieval Exchange, I presented the hypothesis that exchange rates by and large oscillated about the intrinsic metal contents of the coins underlying the moneys of account concerned. I still believe this to be true in normal times, when the intrinsic metal content of a coinage was basically equal to the price of the metal in it, minus the costs of coining, and with negligible profit or loss to the ruler. However, my hypothesis does not work when currencies were debased, for example in France at the end of Charles VII's reign, between 1417 and 1422. Numismatists, concerned with the coins themselves, have naturally concentrated on their weight and fineness. For normal times this is also what economic historians need to know. However, it is now apparent that in abnormal times, in debasement conditions, economic historians should be more interested in the prices offered by the mints for silver than with what the mints did with it afterwards. In periods of debasement there was quite frequently a deliberate official policy of secrecy to prevent the public from knowing the extent of debasement. If the public did not know how far the coin was being debased, they did know how much the mint was prepared to pay for silver, and adjusted their expectations to this, on the false assumption, that, as in normal times, debasement was in proportion to the rise in the price offered for silver.

In the Dauphin's parts of France a sequence of debasements meant that 46 times the value of coin was actually made from the marc of silver in 1422 than had been made in 1416. The public did not know this. What they did know was that at the same time the sum paid for the marc of silver had increased twelve-fold. If they thought that debasement was of this order they were hopelessly wrong.

The previous chapters have demonstrated how the transformation of the Antwerp economy between the late eighteenth and the middle of the nineteenth centuries went hand in hand with a constant restructuring of migration patterns. Although migrants secured the better half of the employment shift's mixed blessings, rising rural pressure and growing employment instability would by mid-century increasingly limit their room for manoeuvre on the urban labour market. The above discussion has indicated, however, that within the group of migrants there existed considerable differences in the extent to which they succeeded in adapting to the manifold changes in the local opportunity structure. This room for manoeuvre appears to have been strongly dependent on migrants’ geographical backgrounds and personal characteristics such as sex, age and skill, which together determined their susceptibility to push dynamics and responsiveness to specific opportunities. Geographical background and personal characteristics, moreover, appear to have borne a meaningful relationship to one another, in the sense that migrants from specific backgrounds also tended to display certain characteristics, although the extent to which this was the case differed according to the distinct migrant groups. Such a correspondence between migrant origins and profile has in the first chapter been loosely defined as a circuit, a term which has also in the previous chapters been used to highlight newcomers’ heterogeneity. After sketching out the overall diachronic shifts in migration patterns in the preceding chapters, it is now time to take a closer look at the meaning and characteristics of these circuits, which eventually shaped the adaptability of different migrant groups, and which determined the speeds of change with which certain transformations took place.

Four Major Migration Circuits

The preceding chapters have several times referred to the existence of different circuits. The associated distinctions were often cast in relatively general terms, such as urban-born versus rural-born, short distance versus long distance, intra-regional versus inter-regional or foreign migrants.

Introduction

My hypothesis is that the increasing difficulties found by Latin American and Caribbean (LA&C) governments to promote growth enhancing policies via foreign trade during the first half of the twentieth century completely changed their system of incentives. Until quite late – for the smallest countries until the late 1940s – they hoped for the return of the old free trade order. The agreements reached at Bretton Woods – with a strong Latin American presence – were highly promising for all of them. The disappointment over the failure to launch the Organization of International Trade was enormous. While in the aftermath of the Second World War western European countries were able to expand their markets, to build a full employment consensus and to keep under control the challenge of the communist parties and the popular attraction of the Soviet Union, Latin American and Caribbean countries had to contend with the shrinking of their markets without any clear explanation as to why they were shrinking. The only reason was the opportunistic behaviour of the developed countries, taking advantage of the Cold War series of exceptions to the Bretton Woods agreements. I use the European southern peripheral countries as a counter-example.

If everybody in the literature accepts the importance of the ‘carrot’ for post Second World War western Europe, what could be the importance of the ‘stick’ for Latin America? In my view, the diminished expectations that were increasingly built from the 1920s to the 1940s fuelled the decline of Latin American institutions.

Introduction

Born in Belgium in 1911 and educated at the Catholic University of Louvain, Triffin left for the USA in 1935 to pursue an MA at Harvard University. He returned briefly to Belgium, where his decision to go back to the USA to become the first Belgian to earn a PhD at Harvard put him at odds with Léon H. Dupriez, head of the economic research institute at Louvain (along with Fernard Baudhuin and Paul van Zeeland), where Triffin had been a research assistant. Yet his decision to return to the USA in 1939 was propitious, because the Nazis invaded Belgium in 1940. This just-in-time escape from an authoritarian regime is a life experience he shared with Machlup and Fellner.

In his brief biography in the Banca Nazionale del Lavoro Quarterly Review, Triffin acknowledged Joseph Schumpeter, his dissertation adviser, as a major influence on his understanding of pure economic theory. He studied fiscal policy from a Keynesian perspective with John Williamson (whose national key currencies perspective Triffin would not share) and Alvin Hansen (whose perspective on ‘fundamental disequilibrium’ Triffin would embrace). Like Hansen, Triffin believed that a country's balance of payments position might arise from significant internal imbalances (deep recession, low output, high unemployment), which could outweigh balance of payments considerations and point towards major policy changes.

‘To Work Hard for a Larger Family’

Introduction

Betsey [John and Elizabeth's eldest daughter, also Elizabeth] was wrong; her mother had not gone a journey to get orders. Instead, she was visiting her family in Lancashire. But the child's innocent words spoke to a very powerful truth about the deep impression made by business on every aspect of life for the Shaws, unwittingly revealing the complex skeins binding together working life and family life, husband and wife, man and woman, public and private, worldly and domestic. These threads were as tightly woven together as any Gordian Knot. In their everyday practices, at home and at work, the lines between John and Elizabeth, and what each of them did, what they were and what they might be, were blurred to a remarkable degree, sometimes almost to the point where they were completely dissolved.

In this chapter I will explore the demands made upon John and Elizabeth, and in time, the wider family, by an enterprising life. Naturally, the business required long hours, whether John was at the home or on the road. This took a toll that was both physical and emotional and was experienced by all alike.

Introduction

The creation of special drawing rights (SDRs) was designed to solve the liquidity shortage that might delay balance of payments adjustment or provoke financial crises. How SDRs were distributed – to whom, how much and how often – was influenced by the ministers and bank governors of the Group of Ten, a group of mostly European officials from countries that had signed the General Arrangements to Borrow, and their deputies. The deputies of the Group of Ten met separately from the IMF in a series of eighteen conferences called the Joint Meetings of Officials and Academics (1964–77), organized by economists Fritz Machlup, Robert Triffin and William Fellner as an early social interest non-governmental organization (NGO). The conference organizers sought to provide a framework within which to manage issues where international management had become inadequate, and, increasingly, to provide a voice and identity for the European nations who were part of the Group of Ten.

While the Fritz Machlup and Robert Triffin Papers confirm the Bellagio Group's recommendation of a special reserve asset as early as 1964, the group's real work on adjustment and special drawing rights (as it came to be called) was done at the Joint Conferences of Officials and Academics from 1964 to 1977.

As discussed in Chapter 8, the Group of Ten countries had emerged as a powerful sub-group, often pursuing their own versions of projects that the IMF as a whole had in progress.

This chapter explores two distinct efforts to develop mining from the end of the eighteenth century and through the nineteenth century. Prior to the onset of industrialization, miners concentrated on the search for gold and precious stones. Nevertheless, provisioning plantations and mines with expensive and scarce iron tools was one of the enduring bottlenecks of the colonial period. Iron ore, forged into implements and machinery, was essential to support the perceived sources of Brazilian wealth: gold, precious stones and sugar. In the twenty-five years prior to independence, the Portuguese Crown attempted to implement Brazil's first industrial policy in order to advance iron mining and forging. This proto-import-substituting-industrialization policy aimed to produce domestically the tools and machinery needed for precious mineral mining and sugar production.

With the return of the Portuguese Crown to Lisbon in 1821, this strategy was abandoned in favour of creating attractive conditions for foreign miners to invest their capital and technology in the search for precious minerals. In response, the St John d'el Rey Mining Company formed in London for the purpose of mining for gold in Minas Gerais. The company's charter dates to 1830, and its mine in Sabará opened in 1834. The unique experience and archival records of this company provide a valuable window into the conflicts and constraints that private enterprise faced in Brazilian mining.

Since Adam Smith, liberal economists have remained sceptical about government banking. Smith rejected government banks as a source of public revenue, but his arguments anticipate those of recent critics. Government banks are mercantilist and interfere with free market relations. Government banks are subject to mismanagement ranging from ‘slothful and negligent profusion’ under monarchies in times of peace to ‘thoughtless extravagance’ under democracies in times of war.

These quotations are separated by a chasm as wide chronologically as socially, but they express a common ideal of early modern English society: every person, regardless of circumstance, should be able to support herself independently. This valuing of self-sufficiency has important implications for the lives of poor women, especially in relationship to their household and family. As recent research has demonstrated, family economies were essential to the maintenance of independence, and that independence was the essence of the aspirations and self-image of even the lower classes. And yet, of course, it could be extremely difficult for poor women, especially, to develop effective strategies for self-reliance, and it may seem problematic to assume that the poor shared the well articulated ideals of their economic ‘betters’.

The Anomaly

This book began when I opened the morning paper in São Paulo on 21 June 2001. Finance Minister Pedro Malan and Central Bank President Arminio Fraga had capitalized Brazilian federal banks to meet Bank for International Settlement (BIS) Basel II Accord guidelines for capital risk. The image of a US-trained economist and advocate of liberalization and privatizations aside a former emerging markets trader at the Soros Fund announcing the capitalization and reform of government banks seemed very odd. Was this another bailout of bureaucrats? Why did reformist President Fernando Henrique Cardoso capitalize rather than privatize these banks after seven years in office, just a year before a decisive campaign to elect his successor? Was this a return to Brazilian statism? Did private banks somehow conspire or acquiesce to keep out foreign competitors (having acquired state government banks and large market shares themselves)? Were Brazilian federal government banks simply too big to fail or too broke to privatize? A mental experiment came to mind. What would a US president do with three big banks? President Henry Jackson's veto of the Second Bank of the US in 1832 made it hard to imagine a US federal bank (I later learned of Abraham Lincoln's advocacy of a National Bank and the US Postal Bank, 1945–8). But the experiment stuck. It seemed impossible that having three big banks under government ownership and control made no difference for policy and political economy.

In the first half of the nineteenth century, Antwerp went through a total transition from a middle-sized regional textile centre to a booming international port town of more than 120,000 inhabitants. An easily accessible and well-connected inland port in the densely populated Low Countries, Antwerp was favourably located to act as a major transit centre for the Southern Netherlands, part of the Northern Netherlands, the German Rhineland and the north of France – mostly densely populated and rapidly industrializing regions. The exploitation of these geographical assets became possible only as a result of the conjunction of certain economic and political conditions, and took place at the cost of deteriorating living and working conditions of Antwerp's labouring poor. The smallholding regions in the city's immediate hinterland, meanwhile, were confronted with strong population growth and increasing proletarianization, resulting in an overall increase of rural push forces. Migration patterns in turn displayed several important shifts over the first decades of the nineteenth century. Mapping these changes in space and time and analysing their relationship to the changes in the city's local opportunity structure is the main point of this chapter. The nature of this relationship, in turn, sheds light on the adaptability of migration patterns, and on the contribution of migrants to the observed transformation of Antwerp's economic structures. What was the role of newcomers in the city's rapid conversion to a port town? What implications did the changes in local opportunity structure have for the socio-economic prospects and life-cycle trajectories of newcomers? And how did new patterns of migration relate to those established for the late eighteenth century?

Converting to a Port Town

Antwerp's conversion from a regional textile centre to an international port town was anything but a gradual or linear process. It took place at different speeds in different phases, which were tied up with the different political regimes under which the urban economy operated.