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Shifting attention: two ideas for a genuine micro founded macro-economic master thesis

Summary:
From Merijn Knibbe I’m trying to write a book about the relation (not) of neoclassical macro-economic concepts to the concepts of macro-economic statistics. Which leads one to interesting places one can’t explore. If there is anybody out there in search for an interesting idea for a master thesis or something light that, these might do: A qualitative and quantitative exploration of ‘hoboism’ in the 1930’s looking at it using the lens of ‘involuntary part time unemployment’ An international and historical extension of existing estimates of domestic servants and how this relates to our estimates of GDP. Ad 1. If you do this well you can make it to the American Economic Review. It’s also great fun. In the thirties, there were hundreds of thousands of ‘hobo’s’ in the USA, mainly young men

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from Merijn Knibbe

I’m trying to write a book about the relation (not) of neoclassical macro-economic concepts to the concepts of macro-economic statistics. Which leads one to interesting places one can’t explore. If there is anybody out there in search for an interesting idea for a master thesis or something light that, these might do:

  1. A qualitative and quantitative exploration of ‘hoboism’ in the 1930’s looking at it using the lens of ‘involuntary part time unemployment’
  2. An international and historical extension of existing estimates of domestic servants and how this relates to our estimates of GDP.

Ad 1. If you do this well you can make it to the American Economic Review. It’s also great fun. In the thirties, there were hundreds of thousands of ‘hobo’s’ in the USA, mainly young men free riding trains (very dangerous!), begging and sleeping wherever it was dry. These hobo’s had an obsession: finding ‘gainful employment’. Here you will find scores of fascinating ego documents of these men (and some women). As such, their existence is a negation of the Cole and Ohanian approach to unemployment during the Great Depression. They do not look at individual people. So, forget about their statement that their ideas are micro-founded: they’re not. instead, they look at ‘average hours worked’ and model the decrease of the average number of hours worked as a voluntary choice of the USA population for more ‘leisure’ – therewith negating the fact that many people had full time jobs while others worked zero hours. Look here for details. The idea for this study is however is to look at individual people who were only partly uneployed (sometimes, the hobos had a gig job) and to make a qualitative study of their search behaviour as well as a quantitative estimate (guesstimate) of their number as well as aggregate the individual data. And to estimate the extent to which USA unemployment data during the thirties have to be increased to account for these hobos. After Pearl Harbour, the hobos almost instantly disappeared. To an extent this was surely caused by labour demand from an overheated war economy. To an extent the political system might (I’m not entirely sure about this) have changed the rules (also because of the war economy, of course): hoboism was not tolerated anymore. This has to be analyzed, too.

Ad 2. In 1946 George Stigler published the NBER study ‘Domestic servants in the United States, 1900-1940‘. He did not underestimate the importance of domestic servants. Quote: “in 1939 there were as many domestic servants as employees of the railroads, coal mines, and automobile industry combined“. Using census information, he gives some comparative information about the historical number or servants in the USA, Germany and the UK. There are many local studies about domestic servants, but a comparative historical overview seems absent. It is possible to extend Stigler’s information backward and forward and to a larger number of countries. Some preliminary work shows that it was only after 1950 that the amount of domestic servants dwindled, at least in rich countries with low unemployment. Many historical censuses are however not on the internet, but the International Labour Organization does have a non-internet databank of 2.000 censuses which might be used. Domestic servants do have their attention (their estimate of the amount of servants world-wide is 52 million). One reason to extend the estimates is of course that macro information about domestic servants is interesting in its own right: it was and is an important aspect of the world of labour. And production. Focussing on this last aspect it is possible to relate the information to ideas about the household as a production entity and changes in the structure of the household, as well to its size and the amount of children, the relation between household production and the market or the mechanization of the household (the washing machine…). The decline of domestic service however seems to have been led by a dwindling supply of servants (mainly: unmarried, young women and, as Stigler notes, in the USA mainly black or immigrant young, unmarried women), not by lower demand. This, however, has to be investigated. There are scores of studies which enable a qualitative assessment of this process on the micro level.  If you manage to make a reliable qualitative assessment of why domestic service declined and a guesstimate of the extent to which this influenced out estimates of nominal and real GDP, it might surely be published in the Review of Income and Wealth or a comparable publication. We can try if the ILO will reimburse travel expenses to Switzerland.

Merijn T. Knibbe
Economic historian, statistician, outdoor guide (coastal mudflats), father, teacher, blogger. Likes De Kift and El Greco. Favorite epoch 1890-1930.

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