Time-budget studies done among contemporary primitive people suggest that the first farmers worked harder to attain subsistence than their foraging predecessors. This makes the adoption of agriculture in the Stone Age one of the major curiosities in human cultural history. Theories offered by economists and economic historians largely fail to capture work-intensification among early farmers. Attributing a key role to human metabolism, this study provides a simple framework for analysing the adoption of agriculture. It demonstrates how the additional output that farming offered could have lured people into agriculture, but that subsequent population increase would eventually have swallowed up its benefits, forcing early farmers into an irreversible trap, where they had to do more work to attain subsistence compared to their foraging ancestors. The framework draws attention to the fact that, if agriculture arose out of need, as some scholars have suggested, then this was because prehistoric foragers turned down agriculture in the first place. Estimates of population growth before and after farming, however, in the light of the present framework seem to suggest that hunters were pulled rather than pushed into agriculture.

There is a lively ongoing debate, led by Stephen Epstein and Sheilagh Ogilvie, about the economic effects of institutions (particularly guilds) on the pre-industrial economies. The focus of the controversy is an article published by Ogilvie in which she points out that there is a new trend, as Epstein puts it, a ‘modern consensus’, aimed at the ‘rehabilitation of guilds’. Based on her study of the Württemberg worsted industry and supplemented with a variety of examples from all over Europe, she develops a theoretical framework outlining the reasons for the economic inefficiency of the guilds. She challenges the view that guilds had a tangible effect on market failures with regard to (1) product quality, (2) innovation and (3) training. She also examines (4) the link between guilds and social capital. This article suggests that the first two issues are the most relevant for an analysis of the economic effects of the activities of the Silesian merchant guilds on regional growth in the eighteenth century. The focal point of this argument is the difference between craft guilds and merchant guilds and thus refers back to the earliest studies by Ogilvie on corporative institutions.

This article traces links between the monetary regime and some institutions of the labour market in Denmark over the past century. The results indicate that elements of the labour market are endogenous. The longest wage contract terms are found towards the end of the pre-World War I classical gold standard period – characterised by price-level stability – and during the period since the mid 1990s that has seen a firm fixed exchange-rate policy and low and stable inflation. The shortest contract lengths are observed in the interwar period with high inflation volatility. Inflation indexation of wages was used most extensively in the Bretton Woods period and during the soft peg period of the 1970s when inflation was high and rising. The degree of nominal wage rigidity in the economy is therefore not necessarily approximately constant, as it is otherwise assumed in many New Keynesian models.

During the ‘Golden Age’, the high investment rates reached by the European countries have been considered crucial in explaining growth. The literature about the Golden Age has emphasized supply-side explanations based on structural change, the reconstruction effort and the catch-up hypothesis, but also demand-side explanations focused on the effects of demand stability for promoting high rates of investment. In this article we have focused our attention on the evolution of the user cost of capital for explaining the high rates of investment. Our hypothesis is that the increase in investment rates was propelled by the decline in the user cost of capital, the consequence largely of the drop in the relative price of machinery. The embodiment of new technology and the reductions in trade barriers explain this decrease in the relative price of machinery.

The article re-examines Sweden's price-level targeting during the 1930s which is regarded as a precursor of today's inflation targeting. According to conventional wisdom, the Riksbank was the first central bank to adopt price-level targeting, although in practice giving priority to exchange-rate stabilisation. Based on Bayesian econometric techniques and the evaluation of new archival sources, we come to the conclusion that defending a fixed exchange rate is hard to reconcile with the claim of adopting price-level targeting. This finding has implications for the prevailing view of the 1930s as a decade of great policy innovations.