During World War II, the German military publicly celebrated the performance of its flying aces to incentivise their peers. This column uses newly collected data to show that, when a former colleague got recognition, flying aces performed much better without taking more risks, while average pilots did only slightly better but got themselves killed much more often. Overall the incentives may have been detrimental, which serves as a caution to those offering incentives to today's financial risk-takers.
Philipp Ager, Leonardo Bursztyn, Joachim Voth, 14 January 2017
Gregori Galofré-Vilà, Martin McKee, Christopher Meissner, David Stuckler, 09 October 2016
In 1953, the Western Allied powers approved the London Debt Agreement, a radical plan to eliminate half of Germany’s external debt and create generous repayment conditions for the remainder. Using new data from the historical monthly reports of the Deutsche Bundesbank, this column argues that the agreement spurred economic growth by creating fiscal space for public investment, lowering costs of borrowing, and stabilising inflation.
Gerben Bakker, Nicholas Crafts, Pieter Woltjer, 05 February 2016
The Great Depression is considered one of the darkest times for the US economy, but some argue that the US economy experienced strong productivity growth over the period. This column reassesses this performance using improved measures of total factor productivity that allow for comparisons of productivity growth in the Depression era and in later decades. Contrary to Alvin Hansen’s gloomy prognosis of secular stagnation, the US economy was in a very strong position during the 1930s by today’s standards.
Timothy Guinnane, 13 August 2015
Greece’s crisis has invited comparisons to the 1953 London Debt Agreement, which ended a long period of German default on external debt. This column suggests that looking back, the 1953 agreement was unnecessarily generous given that Germany’s rapid growth lightened the debt repayment burden. Unfortunately for Greece, the motivations driving the 1953 agreement are nearly entirely absent today.
Johann Custodis, 18 September 2012
There were 35 million prisoners of war in WWII. This column presents new research on the use of their labour in Nazi Germany, quantifying the economic impact on the Nazi wartime economy.
Joachim Voth, Nico Voigtländer, 01 May 2012
The persecution of Jews during WWII is one of the darkest and most puzzling chapters of recent history. This column asks how economics can help our understanding, particularly of how people’s attitudes to Jews have changed over time. It argues that ‘cultural economics’ shows that there is more to understanding how people behave than looking at their incentives.