I am a full professor in the economics of financial development at Groningen University, with a PhD from the University of Amsterdam (2001). After post-doc research at Imperial College London, research officer at ODI and work as Adviser to DFID, I came to Groningen in 2004. Research Inspirations: Keynes, Schumpeter, Minsky. My central question: how does finance support investment and innovation leading to stable, sustainable and equitable growth? My approach: think in balance sheets, follow the money, understand institutions, use innovative data. I wrote a few dozen peer-reviewed articles, engage in policy advice and media contributions, organized symposia, give keynote and other talks, teach master students, supervise PhD projects. My work was supported by the Institute for New Economic Thinking. I am a memeber of the Sustainable Finance Lab. Welcome.
Long-term growth in developing countries has been explained in four frameworks: ‘extractive colon... more Long-term growth in developing countries has been explained in four frameworks: ‘extractive colonial institutions’ (Acemoglu et al., 2001), ‘colonial legal origin’ (La Porta et al., 2004) ‘geography’ (Gallup et al., 1998) and ‘colonial human capital’ (Glaeser et al., 2004). In this paper we test the ‘colonial human capital’ explanation for sub-Saharan Africa, controlling for legal origins and geography. Utilizing freshly
This paper is the first study to conduct an econometric analysis of indigenous slavery in Africa.... more This paper is the first study to conduct an econometric analysis of indigenous slavery in Africa. We distinguish indigenous slavery from export slavery and survey the literature in order to identify the factors that shaped its prevalence and its impact on Africa's long-term development. We present data collected from colonial records and utilize these in a statistical analysis. The results
ABSTRACT Although Africa’s indigenous systems of slavery have been extensively described in the h... more ABSTRACT Although Africa’s indigenous systems of slavery have been extensively described in the historical literature, comparatively little attention has been paid to analyzing its long term impact on economic and political development. Based on data collected from anthropological records we conduct an econometric analysis. We find that indigenous slavery is robustly and negatively associated with current income levels, but not with income levels immediately after independence. We explore one channel of transmission from indigenous slavery to income growth consistent with this changing effect over time and find evidence that indigenous slavery impeded the development of capable and accountable states in Africa.
This article explores the structure of the rural economy in Armenia from a farm household perspec... more This article explores the structure of the rural economy in Armenia from a farm household perspective. Ownership of capital and access to activities are examined on the basis of data from a recent large-scale survey of farm households in Armenia. Different measures for the outcome of livelihood strategies in terms of well-being are observed. Income-poor households are found to be less well endowed especially with financial and social capital. They derive smaller income shares from economic activities and more from dissaving and social payments. The findings are relevant to policies aimed at alleviating rural poverty.
The replacement of wage-labour farms by family farms in Central and Eastern Europe during the tra... more The replacement of wage-labour farms by family farms in Central and Eastern Europe during the transformation has been more limited than was initially expected. In this paper a formal framework is developed in order to analyse the behaviour of family farms and socialist-style farms in the presence of risk, given the typical post-socialist environment. Management incentives, ownership structure, lump-sum transfers and consumption choices are shown to have the potential to limit the size of family farms relative to socialist-style farms. The hypotheses are tested with survey data collected by the author in the Czech Republic.
In this paper we explore the variety of monetary policy transmission channels in an agent-based m... more In this paper we explore the variety of monetary policy transmission channels in an agent-based macroeconomic model. We identify eight transmission channels and present a model based on Caiani et al. Caiani et al., 2016, extended with an inter-bank market. We then analyze model simulation results of interest rate shocks in terms of GDP and inflation for four of the transmission channels. We find these effects to be small, in line with the view that monetary policy is an weak tool to control inflation.
The replacement of wage-labour farms by family farms in Central and Eastern Europe during the tra... more The replacement of wage-labour farms by family farms in Central and Eastern Europe during the transformation has been more limited than was initially expected. In this paper a formal framework is developed in order to analyse the behaviour of family farms and socialist-style farms in the presence of risk, given the typical post-socialist environment. Management incentives, ownership structure, lump-sum transfers and consumption choices are shown to have the potential to limit the size of family farms relative to socialist-style farms. The hypotheses are tested with survey data collected by the author in the Czech Republic.
The composition of private debt matters to the severity of post-2007 recessions. Using new data o... more The composition of private debt matters to the severity of post-2007 recessions. Using new data on four types of bank credit over 2000-2012 for 51 economies in OLS and Bayesian averaging models, we find that changes in the share of household mortgage credit in total credit before the crisis are significantly associated with recession depth and growth loss after the 2007 crisis. This finding is robust to a wide range of control variables and to the different responses across advanced and emerging economies. The evidence also suggests that mortgage growth combined with increasing bank leverage was particularly damaging to output growth. We discuss policy implications and future research.
Does financial development increase income inequality? Ambiguous answers to this question to date... more Does financial development increase income inequality? Ambiguous answers to this question to date may be due to over-aggregation. In data over 1990–2012 for 26 EU economies, we study the effects on income inequality of different components of financial development. We find that bank credit to real estate and financial asset markets, which increases the wage share of the Finance, Insurance and Real Estate (FIRE) sector, increases income inequality. Credit to non-financial business and for household consumption supports broader income formation, decreasing income inequality. There was a large shift of bank credit allocation since the 1990s, away from supporting investments by non-financial firms and towards financing capital gains in real estate and financial asset markets. Combined with our new findings, this ’debt shift’ helps to understand the growth of inequality.
Non-technical summary The thesis of this paper is that the COVID-19 crisis creates opportunities ... more Non-technical summary The thesis of this paper is that the COVID-19 crisis creates opportunities for fundamental change towards a more sustainable economy, for two reasons: structural change in the economy and a change in public opinion. The paper identifies how the COVID-19 crisis accelerates six processes of change that can be leveraged in policy making. With a focus on the Netherlands, it argues for activist government policy because of the tipping-point nature of the economic system in the crisis. Technical summary Structural change in the economy and a change in public opinion during the COVID-19 crisis jointly imply that government choices regarding investments, regulation and taxes can now create stronger synergies of cleaner economic growth and employment creation with ecological, social and financial sustainability. The paper details this for six areas, with examples taken from The Netherlands. High levels of private and (in some countries) public debt may become so unsusta...
This review article assesses the legacy of Hyman Minsky on the occasion of two newly published bo... more This review article assesses the legacy of Hyman Minsky on the occasion of two newly published books. It identifies two strands of research building on Minsky’s ideas and his research practice, which was eclectic. These two strands draw inspiration from, respectively, a ‘Money View Minsky’ and a ‘Model Minsky’. They represent different ways of doing economics, and they highlight, respectively, the microeconomic and macroeconomic dimensions of the Minskian analysis. Their compatibility hinges on the contested issue of aggregation in the financial instability hypothesis. This paper presents reviews of the books, and it highlights the diversity and the tensions in interpretations of Minsky’s work.
Long-term growth in developing countries has been explained in four frameworks: ‘extractive colon... more Long-term growth in developing countries has been explained in four frameworks: ‘extractive colonial institutions’ (Acemoglu et al., 2001), ‘colonial legal origin’ (La Porta et al., 2004) ‘geography’ (Gallup et al., 1998) and ‘colonial human capital’ (Glaeser et al., 2004). In this paper we test the ‘colonial human capital’ explanation for sub-Saharan Africa, controlling for legal origins and geography. Utilizing freshly
This paper is the first study to conduct an econometric analysis of indigenous slavery in Africa.... more This paper is the first study to conduct an econometric analysis of indigenous slavery in Africa. We distinguish indigenous slavery from export slavery and survey the literature in order to identify the factors that shaped its prevalence and its impact on Africa's long-term development. We present data collected from colonial records and utilize these in a statistical analysis. The results
ABSTRACT Although Africa’s indigenous systems of slavery have been extensively described in the h... more ABSTRACT Although Africa’s indigenous systems of slavery have been extensively described in the historical literature, comparatively little attention has been paid to analyzing its long term impact on economic and political development. Based on data collected from anthropological records we conduct an econometric analysis. We find that indigenous slavery is robustly and negatively associated with current income levels, but not with income levels immediately after independence. We explore one channel of transmission from indigenous slavery to income growth consistent with this changing effect over time and find evidence that indigenous slavery impeded the development of capable and accountable states in Africa.
This article explores the structure of the rural economy in Armenia from a farm household perspec... more This article explores the structure of the rural economy in Armenia from a farm household perspective. Ownership of capital and access to activities are examined on the basis of data from a recent large-scale survey of farm households in Armenia. Different measures for the outcome of livelihood strategies in terms of well-being are observed. Income-poor households are found to be less well endowed especially with financial and social capital. They derive smaller income shares from economic activities and more from dissaving and social payments. The findings are relevant to policies aimed at alleviating rural poverty.
The replacement of wage-labour farms by family farms in Central and Eastern Europe during the tra... more The replacement of wage-labour farms by family farms in Central and Eastern Europe during the transformation has been more limited than was initially expected. In this paper a formal framework is developed in order to analyse the behaviour of family farms and socialist-style farms in the presence of risk, given the typical post-socialist environment. Management incentives, ownership structure, lump-sum transfers and consumption choices are shown to have the potential to limit the size of family farms relative to socialist-style farms. The hypotheses are tested with survey data collected by the author in the Czech Republic.
In this paper we explore the variety of monetary policy transmission channels in an agent-based m... more In this paper we explore the variety of monetary policy transmission channels in an agent-based macroeconomic model. We identify eight transmission channels and present a model based on Caiani et al. Caiani et al., 2016, extended with an inter-bank market. We then analyze model simulation results of interest rate shocks in terms of GDP and inflation for four of the transmission channels. We find these effects to be small, in line with the view that monetary policy is an weak tool to control inflation.
The replacement of wage-labour farms by family farms in Central and Eastern Europe during the tra... more The replacement of wage-labour farms by family farms in Central and Eastern Europe during the transformation has been more limited than was initially expected. In this paper a formal framework is developed in order to analyse the behaviour of family farms and socialist-style farms in the presence of risk, given the typical post-socialist environment. Management incentives, ownership structure, lump-sum transfers and consumption choices are shown to have the potential to limit the size of family farms relative to socialist-style farms. The hypotheses are tested with survey data collected by the author in the Czech Republic.
The composition of private debt matters to the severity of post-2007 recessions. Using new data o... more The composition of private debt matters to the severity of post-2007 recessions. Using new data on four types of bank credit over 2000-2012 for 51 economies in OLS and Bayesian averaging models, we find that changes in the share of household mortgage credit in total credit before the crisis are significantly associated with recession depth and growth loss after the 2007 crisis. This finding is robust to a wide range of control variables and to the different responses across advanced and emerging economies. The evidence also suggests that mortgage growth combined with increasing bank leverage was particularly damaging to output growth. We discuss policy implications and future research.
Does financial development increase income inequality? Ambiguous answers to this question to date... more Does financial development increase income inequality? Ambiguous answers to this question to date may be due to over-aggregation. In data over 1990–2012 for 26 EU economies, we study the effects on income inequality of different components of financial development. We find that bank credit to real estate and financial asset markets, which increases the wage share of the Finance, Insurance and Real Estate (FIRE) sector, increases income inequality. Credit to non-financial business and for household consumption supports broader income formation, decreasing income inequality. There was a large shift of bank credit allocation since the 1990s, away from supporting investments by non-financial firms and towards financing capital gains in real estate and financial asset markets. Combined with our new findings, this ’debt shift’ helps to understand the growth of inequality.
Non-technical summary The thesis of this paper is that the COVID-19 crisis creates opportunities ... more Non-technical summary The thesis of this paper is that the COVID-19 crisis creates opportunities for fundamental change towards a more sustainable economy, for two reasons: structural change in the economy and a change in public opinion. The paper identifies how the COVID-19 crisis accelerates six processes of change that can be leveraged in policy making. With a focus on the Netherlands, it argues for activist government policy because of the tipping-point nature of the economic system in the crisis. Technical summary Structural change in the economy and a change in public opinion during the COVID-19 crisis jointly imply that government choices regarding investments, regulation and taxes can now create stronger synergies of cleaner economic growth and employment creation with ecological, social and financial sustainability. The paper details this for six areas, with examples taken from The Netherlands. High levels of private and (in some countries) public debt may become so unsusta...
This review article assesses the legacy of Hyman Minsky on the occasion of two newly published bo... more This review article assesses the legacy of Hyman Minsky on the occasion of two newly published books. It identifies two strands of research building on Minsky’s ideas and his research practice, which was eclectic. These two strands draw inspiration from, respectively, a ‘Money View Minsky’ and a ‘Model Minsky’. They represent different ways of doing economics, and they highlight, respectively, the microeconomic and macroeconomic dimensions of the Minskian analysis. Their compatibility hinges on the contested issue of aggregation in the financial instability hypothesis. This paper presents reviews of the books, and it highlights the diversity and the tensions in interpretations of Minsky’s work.
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