Saturday, January 1, 2011

New Year's update

So, we have four papers and a book (yes!) to finish off this year. Here is a little run-down job by job:

1. The 'political' paper is under peer review at the moment. Let me know if you want a copy. We showed that there was a strong statitistical relationship between the type of crops grown in a political constituency, the attendance at church of the residents, and how the MP for that constituency voted. The parliament of 1841 was very much about 'church and state' and so these findings make sense. We used some novel statistical techniques to get round the 'missing voter' problem. Many MPs didn't turn up for divisions and so our sample size is small. But we know all we need about the MP except for how he would have voted had he turned up. We want to keep this information, not toss it out. We used Anne Sartori's improvement on the Heckman procedure (he won a Nobel for that). Special kudos to Hugh (Salway) from the University of York in the UK for volunteering a huge amount of time and helping us with hard to get data. Come and visit us, Hugh!

2. The 'Devon rents' paper. Here we are using very old data: from the 1836 Tithe Commission. We find that in the county of Devon, there is an amazingly robust relationship between arable rent, wheat yields, elevation and distance to market town. This fits all the 'locational rent' theories: von Thunen, Ricardo etc. So not content with that, we want to see whether this relationship holds in neighbouring counties. Malcolm has built up a large dataset (n>600) of parishes in six contiguous (look it up!) counties. What is interesting is that some parts of the relationship change as we move east, seeming at first sight to indicate less reliance on local markets as we get closer to London. Makes sense. To test this, we'll be using a relatively new statistical technique called Geographically Weighted Regression. In regular regression, we are trying to estimate some 'global' parameter that fits throughout the statistical population. In GWR, we allow the parameter estimates to vary according to local conditions. I am keen to measure the elasticity between rent and what the tenant farmer could take home to his wife and kids: in other words, were some landlords greedier than others, and if so, why? I am half-hopeful that we'll see the hand of the Anglican Church behind all this, but mustn't get my hopes up.

3. The 'railways and rents' paper. A huge amount of track construction went on in 'our' period, see the graph below. This must have had some impact on farming. James Caird, writing in 1851, makes an intriguing reference to a Norfolk farmer saving four hundred pounds a year ( a lot. You could have bought a Bentley if they had made them then) because his cattle didn't lose weight when they went by rail; when he walked them to market they ended up quite thin. But amazingly there isn't much published on this. And I can see why. Getting the data is like pulling hen's teeth. Malcolm is figuring out the total amount of track in a 40km radius of Holkham Hall, Norfolk for the years 1836 to 1866 on an annual basis. And Mi is scouring the libraries of the world for any sort of references that might help. Here is the graph:.

Growth like this must have had consequences! We hypothesise that the tenant-farmer's savings would have been transferred to the landlord via an increased rent. This is the phenomenon of 'surplus extraction'. Generally you want to be the extractor, not the extracted. But the tenants were in a weak we would expect to see their rents going up in tandem with better transportation. Mi has got us the rents, now we await Malcolm's annual track data. Then I'll use a time-series analysis procedure called ARIMA to test for linkage. If the Norfolk estate gives us a YES, we'll extend the procedure to other estates and use a panel-data approach. Nice cutting edge stuff.

4. The 'supply response' paper. In the 1870s, the price of wheat fell dramatically because those blasted Americans opened up their railroads and shipped in wheat below the domestic price. See the graph of wheat prices below. Quite shocking: halved in price in less than two decades.
Look what has happened: wheat has halved but livestock numbers have shot up. This look like a structural shift in agriculture. But this is at the national level....individual farmers won't all have been able to shift out of wheat and into livestock.  We hypothesise that those estates which were more flexible with what the tenants did with their land probably didn't need to drop their rents as much as those estates which were more rigid. Farmers are not (always) stupid and can adapt pretty well to changing market conditions. Different matter if they can't adapt because of regulations on land use. We will test for a 'breakpoint' in rents, and then use that year as an indicator. Going to borrow from medical statistics, normally for use in working out how long a patient has got to live. Again, nice cutting edge stuff.
5. A book! New idea, inspired by Sarah, one of my two fantastic sisters. This is historical fiction, in other words a story based on real people. The working title is 'Breaking Free From Dr Malthus' and the theme is how the heck did the farmers increase yields enough to allow enough folk to escape from the hard scrabble of agriculture to start off the Industrial Revolution. A new format...left hand side page is fiction, the facing right hand side is economic analysis and commentary on the the fiction. Including the highly exciting new field of neuro

1 comment:

Malcolm V L said...

I just had to see how much £400 inflates to from 1850 - today, and it comes out to ~£34,000 ($53,000). I'd probably buy Japanese though.