Vol. 71, No. 3

Yukihiko KIYOKAWA and Rui TAKAHASHI
Employment opportunities of female labor in the cotton ginning industry in prewar India: the significance of rural factories with modern technology

This paper aims to estimate the new opportunities for female employment in machine-ginning factories in prewar India.

The hand-ginning production was rapidly replaced by that of machine-ginning factories since the turn of the twentieth century. This substitution was greatly promoted due to rapid increases in the opportunity cost for hand-ginning workers with low productivity.

The new factories equipped with ginning machines also provided ample employment opportunities to women workers, in contrast with other manufacturing factories. The statistics, however, for employment size of the female labor force in the prewar period are not available.

Thus, in Section I, we specify the typical work and relative size of women workers in a standard ginning factory with the most common technology, based on partial information of various ginning factories. In the process of this confirmation, we clarified the reasons for the suitability of the roller gin (not saw gin) for Indian cotton.

In Section II, we estimated the employment size of female labor in the cotton-ginning industry by combining the data of installed gins in Large Industrial Establishments in India with sex ratios of the workers from Industrial Censuses (1911 and 1921) in various provinces. The estimates of nearly 70 thousand female workers in the 1920s and 1930s are considered to be the third largest in the manufacturing industry, next to the food-processing and the cotton-spinning industries.

The experience of the cotton-ginning industry provided employment possibilities for women in rural factories with greater linkage effects than in the plantation industries.

Kenta KATO
Corporate acquisition in the electric-power industry during the interwar period in Japan

The purpose of this paper is to analyze the effects of corporate acquisitions in the electric-power industry during the interwar period in Japan.
First, we examine the change in the structure of electric companies' stockholdings and the board of directors. In the second half of the 1920s, electric companies whose business showings were deteriorating in an increasingly competitive environment actively purchased stocks of other electric firms to become the largest stockholder and then dispatched executives to these firms.

Second, we focus our attention on electric supply networks, business connections, capital investments, and restructuring of the acquired companies. The acquired companies not only improved their power lines and substations but also built new ones in order to tie each power plant together organically. The equipment and facilities connected through acquisitions worked to expand the companies' electric supply networks. In this process, the acquiring companies became involved in the plans that were being carried forward by the acquired companies. On the other hand, the acquired companies withdrew from their subsidiary businesses to concentrate their funds on the electric power section. At the same time they saved their financial costs by raising funds through low-interest loans and debt condensing through the issuance of new corporate bonds.

Hidenao TAKAHASHI
Short-term interest rates and arbitrage: money markets in London and New York under the reconstructed gold standard

The purpose of this article is to examine arbitrage behaviour in the London and New York money markets under the 'reconstructed' gold standard (1925-1931), by taking into account an emerging forward exchange market in London. The analysis is conducted by applying non-stationary time series methods to previously unexploited weekly data for dollar-sterling spot and forward rates. It has been demonstrated that short-term interest rates in pre-World War I London and New York were closely correlated, suggesting that arbitrage was the key for the cross-Atlantic functioning of money markets under the classical gold standard. By the early 1920s, however, market situations changed with the emergence of the London forward exchange market. Our time series analysis for this period reveals: First, interest rate linkages disappeared. Second, however, any difference in the short-term interest rate between the two markets was being adjusted with arbitrage by investors through forward exchange transactions. This is a mechanism of covered interest parity, the working of which is well captured by our statistical analysis.

All this suggests that the money markets under the interwar gold standard worked reasonably well. However, this was achieved in the late 1920s when forward market transactions were declining, suggesting that the causes of the breakdown of the interwar gold standard should be sought for in international circumstances surrounding the money markets, rather than the market mechanism itself, of the day.