Books

MIT Press (2020)

Distributed ledger technology (DLT) has the potential to transform economic organizations and financial structures. In this book, Robert Townsend steps back from the hype and controversy surrounding DLT (and the related, but not synonymous, innovations of blockchain and Bitcoin) to offer an economic analysis of what distributed ledgers can do and a blueprint for the optimal design and regulation of financial systems. Townsend examines the key components of distributed ledgers, discussing, evaluating, and illustrating each in the context of historical and contemporary economies, reviewing featured applications in both developed economies and emerging-market countries, and indicating where future innovations can have large impact.

Throughout, Townsend emphasizes the general-equilibrium impact of DLT innovations, the welfare gains from these innovations, and related regulatory innovations. He analyzes four crucial components of distributed ledgers—ledgers as accounts, e-messages and e-value transfers, cryptography, and contracts—assesses each in terms of both economics and computer science, and forges some middle ground. Relatedly, Townsend highlights hybrid systems in which some of these components allow useful innovation while legacy or alternative pieces deal with the problem of scale. The specific applications he analyzes include an intelligent financial automated system that provides financial services to unbanked and under-banked populations, and cross border payments systems, including financial systems that can integrate credit and insurance with clearing and settlement. Finally, Townsend considers cryptocurrencies, discussing the role and value of tokens in economies with distributed ledger systems.

Open Access version: https://direct.mit.edu/books/book/4932/Distributed-LedgersDesign-and-Reg...

 

Chronicles from the Field: The Townsend Thai Project
MIT Press (2013)

Running since 1997, the Townsend Thai Project has tracked millions of observations about the economic activities of households and institutions in Thailand. The authors offer an account of the design and implementation of the survey and tell the story not only of the origins and operations of the project but also of the challenges and rewards that come from a search to understand the process of a country's economic development.The book explains the technical details of data collection and survey instruments but emphasizes the human side of the project. It is supplemented with an epilogue on research findings and an appendix that contains a list and abstracts of papers using data from the project. Social and economic policies are too often skewed by political considerations. The Townsend Thai Project offers another basis for policy: accurate measurement based on thoroughly collected data. From this a clear template emerges for understanding poverty and alleviating it.

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Oxford University Press (2011)

Unique in its approach and in the variety of methods and data employed, this book is the first of its kind to provide an in-depth evaluation of the financial system of Thailand, a proto-typical Asian developing economy. Using a wealth of primary source qualitative and quantitative data, including survey data collected by Robert M. Townsend, it evaluates the impact of specific financial institutions, markets for credit and insurance, and government policies on growth, inequality, and poverty at the macro, regional, and village level in Thailand. Useful not only as a guide to the Thai economy but more importantly as a means of assessing the impact that financial institutions and policy variation can have at the macro- and micro-level, including the distribution of gains and losses, this book is invaluable to academics and policymakers with an interest in development finance.

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Households as Corporate Firms: Analysis of Household Finance Using Integrated Household Surveys & Corporate Financial Accounting
Cambridge University Press (2009)

This investigation proposes a conceptual framework for measurement necessary for an analysis of household finance and economic development. The authors build on and, where appropriate, modify corporate financial accounts to create balance sheets, income statements, and statements of cash flows for households in developing countries, using an integrated household survey. The authors also illustrate how to apply the accounts to an analysis of household finance that includes productivity of household enterprises, capital structure, liquidity, financing, and portfolio management. The conceptualization of this analysis has important implications for measurement, questionnaire design, the modeling of household decisions, and the analysis of panel data.

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The Medieval Village Economy: A Study of the Pareto Mapping in General Equilibrium Models
Princeton University Press (1993)

In this book, Townsend combines the theory of general economic equilibrium with the notion that allocations and institutions of a given economy might be Pareto optimal to try to explain various salient features of the medieval village economy. The medieval village economy in many ways reflects the economies of poor high-risk agrarian villages of the contemporary world and serves as an ideal testing ground for Townsend's theories. The environment of the medieval village resembles those of relatively simple models with such key elements as uncertainty and private information, and its institutions display distinctive features such as fragmented landholding patterns. In this book standard models of macroeconomics and the literature on contract theory and mechanism design are reinterpreted, applied, and extended. The author draws both descriptive institutional material and particular parameter values from historical observations, and characterizes solutions to the models analytically and numerically. The idea is to see whether the observed outcomes can be explained, shedding light both on the historical material and the models themselves.

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Financial Structure and Economic Organization
Basil Blackwell Inc. (1990)

This volume focuses on how groups of economic agents organize themselves, with a special interest in the financial arrangements they adopt. This is achieved primarily through the development and refinement of neoclassical models incorporating transactions costs and impediments to trade, but also through parallels with the organization of real economies drawn from the history of early Europe. The author demonstrates that the key elements determining financial structure and economic organization in history are the key features in the described environments of modern economics models. These include the facts that economics agents are separated in time and space; economic life is full of uncertainty; there are sometimes difficulties of communication among agents; and there can be problems in getting agents to commit to arrangements, the difficulties of costly and limited enforcement. Analyzing these central issues both in theory and in history, Professor Townsend makes a highly original contribution to the understanding of the diverse forms of economic and financial organization.

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