VoxTalks Economics

In January 1860 the New York Times gave its blessing to a new machine: the sewing machine. These "iron needle-women", it wrote, were the only invention that could be claimed “chiefly for women's benefit”. Sewing was women's work in the nineteenth century, rich or poor, and a machine could now do it in a fraction of the time. So did it set women free?
Philipp Ager and Davide Coluccia have traced the adoption of the sewing machine in Massachusetts between 1850 and 1900, using census records and digitised business directories to work out who was exposed to it, in the factory and in the home. For poorer women the machine meant work, in garment factories and in boot and shoe production; they married later, had fewer children, and many never married at all. For wealthier women, who had few acceptable jobs open to them, the hours it saved went into earlier marriage and earlier motherhood. Philipp tells Tim Phillips the story of a machine that had very different impacts in different social classes.
The research behind this episode:
Ager, Philipp, and Davide Coluccia. 2026. "Liberation Technology? The Impact of the Sewing Machine on Women." CEPR Discussion Paper No. 21496. CEPR Press, Paris and London. CEPR Discussion Papers are gated; CEPR members and subscribing institutions can download the paper at the link.
To cite this episode:
Phillips, Tim, and Philipp Ager. 2026. "Did the Sewing Machine Liberate Women?" VoxTalks Economics (podcast). 

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About the guests

Philipp Ager is professor of economics at the University of Mannheim, a Research Fellow of the Centre for Economic Policy Research, and an editorial board member at Explorations in Economic History. His research spans the economic history of the United States, technological change, and the long-run effects of crises and disasters; his work on the Great Fire of London of 1666 featured in an earlier episode of VoxTalks Economics.
Research and sources cited in this episode

The Song of the Shirt. Thomas Hood's poem about a destitute seamstress was first published anonymously in Punch in December 1843. Hood based it on the case of Mrs Biddell, a London widow prosecuted after pawning clothes she had been given to sew. 
Godey's Lady's Book. The most widely read women's magazine in the US at the time crowned the sewing machine "the queen of inventions" in 1860, having calculated that a man's shirt took 20,620 stitches and 14 hours to sew by hand, against an hour and a quarter by machine. 
Singer and the Sewing Machine: A Capitalist Romance. Ruth Brandon's 1977 biography of Isaac Singer (Google Books) is the source for both Singer quotations read in this episode. .
How the Other Half Lives. Jacob Riis, a Danish-born police reporter in New York, published his account of tenement and sweatshop life in 1890 (free at Project Gutenberg). The shirtmaker's testimony read in this episode was given to the State Board of Arbitration during the shirtmakers' strike and reported by Riis in his chapter on the working girls of New York.
The household appliance revolution. Philipp contrasts the sewing machine with the washing machines and vacuum cleaners that arrived two generations later, which economists have credited with freeing women to join the workforce; "Engines of Liberation" by Jeremy Greenwood, Ananth Seshadri and Mehmet Yorukoglu, Review of Economic Studies, 2005, covers this topic. The sewing machine saved time in the same way, but in the 1860s far fewer acceptable jobs awaited the women whose time it saved.
More VoxTalks Economics episodes

The economic effect of the Great Fire of London. Philipp Ager's previous visit to VoxTalks Economics, with Paul Sharp, on what contemporary records reveal about London's uneven recovery after 1666.
Related reading on VoxEU

Gender norms and the labour market, a VoxEU column on how norms, both internalised and enforced by peers, constrain women's labour market outcomes; the modern counterpart of the stigma that kept married women in Massachusetts out of paid work.

Every day, billions of transactions settle between strangers who have no idea which bank the other uses. That lack of friction is not automatic. Nine-tenths of the money in daily circulation has been created by commercial banks, but it stays trustworthy only because central banks stand behind it, and keep the system in balance.
In this week’s episode Tim Phillips talks to Stephen Cecchetti (Brandeis University, CEPR) about what happens when new forms of digital money test that architecture. Cecchetti is one of the authors of the eighth Barcelona Report in The Future of Banking series, part of the Banking Initiative at IESE Business School, just published by CEPR as a free download.
Will retail central bank digital currencies, tokenised deposits, and stablecoins upset the delicate balance of system that has been running for decades? Stablecoins, for example, do not create money, but they claim the status of money without the institutional guarantee that makes money trustworthy. Three jurisdictions — the US, the EU, and the UK — are each resolving the same underlying contradiction in different ways. None has fully resolved it.
The research behind this episode:
Niepelt, Dirk, Stephen G. Cecchetti, Hélène Rey, and Xavier Vives. 2026. Digital Money: The Future of Banking 8. London: CEPR Press. Available as a free download from CEPR.
To cite this episode:
Phillips, Tim, and Stephen G. Cecchetti. 2026. “The digital money supply.” VoxTalks Economics (podcast). 

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About the guest

Stephen Cecchetti is the Rosen Family Chair in International Finance at Brandeis University, a Research Fellow of the Centre for Economic Policy Research (CEPR), and a Research Associate at the NBER. He was previously Economic Adviser and Head of the Monetary and Economic Department at the Bank for International Settlements, and Director of Research at the Federal Reserve Bank of New York. His research spanning monetary policy, financial stability, and banking regulation has shaped both academic and policy debate over three decades. He blogs at moneyandbanking.com.
Research cited in this episode

Walter Bagehot's lender of last resort doctrine. In Lombard Street: A Description of the Money Market (1873), Bagehot argued that a central bank under stress should lend freely against good collateral at a penalty rate. The prescription remains the intellectual foundation for how central banks manage runs and systemic crises. Cecchetti invokes it to make the point that no private substitute for a central bank backstop has ever proved durable, and that the doctrine is now, one hundred and fifty years on, being tested by instruments its author could not have imagined.
Monetary uniformity, mobility, and elasticity. The three institutional conditions underpinning general acceptance of money, developed in analysis by the Bank for International Settlements and discussed extensively in the report. Uniformity means a pound is a pound regardless of which bank holds it. Mobility means claims move between users and institutions at low cost and settle with finality. Elasticity means the supply of money can expand when it is under stress. Together they explain why we accept a deposit at face value without doing any analysis of the bank that issued it; and together they identify exactly where new forms of digital money create institutional gaps.
Silicon Valley Bank failure, March 2023. SVB's collapse illustrates both the lender of last resort functioning and the limits of no-bailout commitments. Cecchetti notes that SVB's liabilities were still trading at par on the Thursday before its Friday failure because the Federal Reserve stood behind them. He also notes that Circle, the issuer of USDC, held $3.3 billion of its reserves at SVB and was effectively bailed out in the resolution. The episode is one of two occasions in the past twenty years where money market fund-like instruments have been backstopped by the Federal Reserve under stress.
Genius Act (United States). Principle-based stablecoin regulation expected to come into effect in the US around 2027. Under its provisions, only stablecoins issued by bank-affiliated issuers will have access to the Federal Reserve; only those will therefore have the institutional backing needed to function as money. Stablecoins issued by non-bank entities will not.
Markets in Crypto Assets Regulation (MiCA), European Union. The EU framework for crypto assets, which entered into force in 2024. For stablecoins, MiCA requires issuers to hold 30 to 60% of their reserves in bank deposits, with no provision for central bank backing. The stated rationale is to keep deposits within the banking system; Cecchetti notes this creates a different category of vulnerability and leaves the question of what happens under stress unresolved.
Bank of England stablecoin proposal (United Kingdom). The Bank of England's approach differs from both US and EU frameworks by explicitly requiring large stablecoin issuers to hold significant reserve deposits at the Bank of England, making them in effect narrow banks with a direct central bank backstop. Cecchetti regards this as the most coherent of the three approaches in terms of institutional logic, though the same fundamental question applies: whether holding to that design under stress would be politically sustainable.
Tether and the jurisdictional challenge. Tether, the largest stablecoin issuer, is registered in El Salvador having previously operated out of the British Virgin Islands. Its tokens are held by users in multiple countries, traded on exchanges in multiple jurisdictions, and backed by US Treasury securities. Cecchetti uses this to illustrate why local regulation, however well-designed, is necessary but not sufficient; effective oversight of instruments that are genuinely global requires international standards and coordination.
Fractional reserve banking and the goldsmith model. The institutional structure described in the episode has roots in mid-seventeenth century England, when goldsmiths began issuing more paper receipts than they had gold in their vaults. The goldsmiths became bankers; the paper became money; the vulnerability to runs became a structural feature of private money creation that persists today. Cecchetti uses the history to make the point that while technology changes how we store and transmit information, the underlying architecture of trust in private money is as old as Newtonian physics.
More VoxTalks Economics episodes

Making banking safe, Stephen Cecchetti and Kermit Schoenholtz. Our financial system is supposed to be more resilient than before the global financial crisis, but that didn’t save Silicon Valley Bank, Signature Bank or First Republic. So what went wrong?
Related reading on VoxEU

New coins on the block: Digital currencies and the financial system. The authors of the Barcelona Report warn that “Digital money will be reliable only where sound institutions and robust technology come together.”

Someone once held a patent on the swing. A piece of wood. Two ropes. The US Patent Office granted it. How often does that actually happen, and what does it cost when the system gets it wrong? Or, how often is a valid patent claim rejected?
Until now, no one knew. Tim Phillips talks to Mark Schankerman of LSE and CEPR, who with co-authors William Matcham spent eight years building the tools to find out. Using natural language processing across a dataset of around one million patent applications, twenty million claims, and fifty-five million examiner decisions, they measure how similar each incoming claim is to the hundred million claims that preceded it, going back to 1976. They find that 81% of initial patent claims fall below the patentability threshold; examiners must negotiate that figure down round by round. And they do a pretty good job. But around a third of all abandoned applications contain at least one valid claim the system failed to protect. You don’t see patents that aren’t awarded, so those errors have, until now, been invisible.
The research behind this episode:
Matcham, William, and Mark Schankerman. Forthcoming. "Screening Property Rights for Innovation." Econometrica. Available as CEPR Discussion Paper DP18334 (gated). Current version dated January 2026.
To cite this episode:
Phillips, Tim, and Mark Schankerman. 2026. “How “well does patent screening work? VoxTalks Economics (podcast). 

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About the guest

Mark Schankerman is Professor of Economics at the London School of Economics, where his research spans innovation, intellectual property, and the economics of technology. His work has examined how patent rights shape R&D incentives, the market for technology, and the behaviour of innovative firms, with particular attention to the institutions that govern how property rights are allocated and enforced.
Research cited in this episode

Prior art. In patent law, prior art is any publicly available knowledge that predates a patent application. Examiners are required to search prior art and reject claims insufficiently distinct from it. The concept defines the outer boundary of what can be granted protection; the closer a claim is to prior art, the weaker the case for granting it.
Type I and Type II errors in patent screening. A Type I error occurs when an examiner grants a claim that should have been rejected, typically because it is too similar to prior art. This allows the holder to charge royalties and, in the US context especially, to bring litigation. A Type II error occurs when a valid claim is refused or abandoned, depriving the applicant of protection they deserve and reducing future incentives to innovate. Schankerman argues that Type II error is systematically under-discussed in public debate: you can point to a patent that should not have been granted; you cannot point to the invention that was never protected.
Structural model. The paper uses a dynamic structural model, meaning it models the actual institutional rules, incentives, and decision sequences that govern patent prosecution at the USPTO. Structural models allow researchers to run counterfactual experiments, asking what would happen if specific rules or incentives were changed, without running those experiments for real. This is the methodological basis for the paper's policy analysis.
Patent distance measure. The paper's key methodological innovation is a quantitative measure of how similar a patent claim is to existing claims, constructed using natural language processing. The algorithm is trained on existing patent documents and compares the textual content of each incoming claim against all prior claims, covering roughly a hundred million filings going back to 1976. This produces a scalar distance figure that can be compared against an estimated patentability threshold.
Deadweight loss. The standard economic term for the welfare cost created when prices are raised above competitive levels. In the patent context, a wrongly granted claim allows its holder to charge higher licensing fees than the market would otherwise bear, generating a cost for users without a corresponding social benefit.
Request for Continued Examination (RCE). A procedural mechanism in the US patent system that allows applicants to re-open a finally rejected application in exchange for a fee. Unlike the European Patent Office or China's patent system, the USPTO places no hard limit on how many times an applicant can return. Schankerman's counterfactual analysis finds that restricting rounds to one substantially reduces screening costs and discourages strategic padding of claims.
Unified Patent Court (UPC). A specialised European court that began operating in June 2023. Its remit covers the enforcement of patent rights across participating EU member states; it does not conduct patentability examinations. Schankerman argues that by reducing the cost of enforcement, the UPC raises the stakes of the upstream screening process: a wrongly granted patent becomes cheaper and easier to assert.
Amazon one-click patent. Amazon received a US patent on the one-click online purchasing process. Schankerman uses the case to illustrate the core economic argument: the relevant question is not whether an invention is valuable, but whether patent protection was necessary to induce its development. If the invention would have occurred regardless, the grant creates costs without providing the intended innovation incentive.
Intrinsic motivation. The tendency for individuals to pursue a task for its own sake rather than for external rewards. Schankerman's model estimates that USPTO examiners exhibit substantial intrinsic motivation and that this is the primary driver of screening quality. In counterfactual simulations, removing intrinsic motivation causes outcomes to deteriorate markedly; removing the credit-based extrinsic incentive system has a much smaller effect.
Padding. Schankerman's term for the strategic behaviour in which patent applicants include claims that are broader than what is strictly novel, hoping some will survive examiner scrutiny and expand the scope of their eventual property right. The paper measures the extent of padding directly from the distance data and confirms it is widespread.
More VoxTalks Economics episodes

Patent pools for generic drugs, Mark Schankerman talks about how diffusion of new drugs is painfully slow in low-income countries. Do patent pools accelerate the process, and how we could still do a better job of licensing life-saving medicines?
Related reading on VoxEU

Patent screening, innovation, and welfare, Florian Schuett and Mark Schankerman, 6 Nov 2020. Critics of the patent system claim that patent rights are becoming an impediment to innovation, and an instrument to extract rents through patent litigation. This column develops a framework to quantitatively assess the effectiveness of the current US patent system and the welfare impact of reforms.

The fiat money system has survived the Great Inflation, the global financial crisis, and a pandemic. But can it survive digital currencies?
Bitcoin and the blockchain solved a genuine problem in computer science: how to stop people spending the same money twice. Forty years of successful inflation control means central bank money is stable; that is the stability in stablecoins, attempting to solve the volatility problem. What's next? What if the unit of account itself were indexed to consumer prices? Digitalisation might finally make that approach viable at scale. Price stability, by design.
Will we still need cash? Maybe not now, But if you never use it, it may not be there if the blackout comes.
The research behind this episode:
Stracca, Livio. 2025. Redefining the Monetary Standard in the Digital Age: Digital Innovations and the Future of Monetary Policy. Springer Nature.
To cite this episode:
Phillips, Tim, and Livio Stracca. 2026. "Redefining the monetary standard." VoxTalks Economics (podcast). 

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About the guest

Livio Stracca is Deputy Director General for International and European Relations at the European Central Bank, where he has worked for more than two decades. His research spans monetary economics, international finance, and the implications of digitalisation for central banking, with extensive work on exchange rates, capital flows, and the architecture of the international monetary system. 
Research cited in this episode

The double-spend problem. The fundamental challenge in any decentralised digital payment system: how to prevent a participant from spending the same unit of money twice when there is no trusted central authority to verify transactions. Bitcoin's 2008 white paper offered an innovative solution by making the transaction ledger public, cumulative, and computationally expensive to rewrite. The trade-off is that transparency sacrifices privacy; every transaction is visible to all participants in the network.
The blockchain. A distributed ledger in which transactions are grouped into sequential blocks, each cryptographically linked to the one before. Reversing any transaction requires rewriting every subsequent block, which demands enormous computational effort. This design solves the double-spend problem in a decentralised network but makes the system slow and costly to operate at scale.
The payment trilemma. A framework discussed in the episode and in Stracca's book: any digital payment system can optimise for at most two of three properties simultaneously (universal access, security against fraudulent transactions, and privacy). Cash is the only instrument that escapes the trilemma; digital systems must accept a trade-off among the three, and the choice is often made implicitly by the designer of the system rather than through democratic deliberation.
Hayek, Friedrich A. 1976. Denationalisation of Money. London: Institute of Economic Affairs. The classic argument for currency competition: let currencies compete freely and the one providing the most stable prices will win. Economists, including Milton Friedman, largely rejected the proposal on the grounds that money exhibits strong network externalities; the more people use a currency, the more attractive it becomes to the next user, producing a natural tendency towards monopoly. A formal modern revisitation, finding similar conclusions, is Fernández-Villaverde, Jesús, and Daniel Sanches. 2019. "Can Currency Competition Work?" Journal of Political Economy 127 (3): 1017 to 1058.
Irving Fisher's compensated dollar. A proposal published in Fisher, Irving. 1913. "A Compensated Dollar." Quarterly Journal of Economics 27 (2): 213–235 (the same year the Federal Reserve was created). Fisher argued for a dollar whose purchasing power was held constant by adjusting its gold content in line with prices. The mechanical details of his proposal are no longer relevant, but its animating idea (indexing the unit of account to a price level) has gained new plausibility in a digital context.
The Unidad de Fomento. Chile's inflation-indexed unit of account, in operation since 1967 and updated daily against the consumer price index. It is used widely in long-term contracts, including mortgages, and functions as a security that can be traded. Stracca cites it as evidence that an indexed monetary standard is operationally feasible, and as a prototype for what a digital equivalent might look like at larger scale.
The Great Moderation. The period of low and stable inflation in advanced economies running roughly from the mid-1980s until the inflation episode of 2021 to 2023. Economists attribute it to improved monetary policy frameworks, particularly central bank independence, inflation targeting, and (crucially, in Stracca's account) the introduction of interest on reserves, which gave central banks precise control over the short-term interest rate without draining liquidity. Stracca treats the Great Moderation as the benchmark against which any proposed reform of the monetary standard must be judged.
Programmable money. A form of digital money in which payment is conditional on an independently verifiable event, potentially confirmed by a machine rather than a human intermediary. Example: a payment that executes automatically when a delivery is confirmed by a sensor. Decentralised ledgers make such conditional payments technically straightforward; traditional banking systems can approximate them but with far greater friction. Stracca notes significant enthusiasm for programmable money but also real scepticism about whether the benefits outweigh the complexity in practice.
More VoxTalks Economics episodes

Stablecoins and Global Imbalances, Gilles Moëc explains why we can think of stablecoins as a radical macroeconomic experiment that has arrived at exactly the moment the US external position is showing signs of stress.
Can blockchain decentralise money, contracts, and finance? Bruno Biais on blockchain’s potential, its flaws, and its future.
Do stablecoins threaten financial stability? Richard Portes thinks so.

Europe's NATO members have pledged 3.5% of GDP to rearmament. The political argument is already about which social programmes will be sacrificed to pay for this, when the government chooses guns instead of butter. What does history tell us about what politicians will do?
Christoph Trebesch and Johannes Marzian spent four years assembling the Global Budget Database: 150 years of primary government budget documents from 20 countries, with 116 identified military spending booms in peace and war. They find that governments almost never cut social spending when they rearm; they expand both military and welfare budgets simultaneously. The bill arrives later, as higher taxes. Top income rates typically rise by 10 to 15 percentage points in the decade following a military boom, funded mainly through broad-based income and value-added taxes. With rearmament underway, will history repeat itself?
The research behind this episode:
Marzian, Johannes, and Christoph Trebesch. 2026. "Guns and Butter: The Fiscal Consequences of Rearmament and War." CEPR Discussion Paper 21193. [Gated]
To cite this episode:
Phillips, Tim, and Christoph Trebesch. 2026. "Guns and Butter." VoxTalks Economics (podcast). 

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About the guest

Christoph Trebesch is Director of the Research Center on International Finance at the Kiel Institute for the World Economy and Professor of Macroeconomics at Kiel University. His research spans sovereign debt, financial crises, China's role in global finance, the economics of populism, and the long-run fiscal history of military spending. He is a Research Fellow of the Centre for Economic Policy Research (CEPR). In 2024 he received the Hermann Heinrich Gossen Award, Germany's leading economics prize for economists under 45.
Research cited in this episode

The Global Budget Database is the primary dataset introduced in this paper. Marzian and Trebesch constructed it from primary archival sources, including national parliamentary budget documents, for 20 countries from 1870 to 2022. Unlike existing datasets that rely on planned rather than realised expenditures, it records what governments actually spent, broken down by ministry and purpose. The Switzerland case illustrates the stakes: standard sources record Swiss military spending at around 2% of GDP during the World Wars. The archival record shows actual spending reached 10% once off-budget items are included; five times the apparent figure.
The Correlates of War (COW) Military Expenditures Dataset is one of the most widely used secondary-source datasets for historical military spending, maintained by the Correlates of War Project. Trebesch uses the Swiss case to illustrate the limitations of secondary-source data: the COW series misses off-budget military items that primary archival documents capture, producing a significantly distorted picture of wartime mobilisation in a number of countries.
Credit booms methodology provided the template for identifying military spending booms. Trebesch and Marzian define a boom as an increase of at least 6.5 percentage points of military spending as a share of GDP over two consecutive years, ending when spending growth falls to zero. This approach, adapted from the literature on financial credit expansions and their economic consequences, allows systematic cross-country and cross-period identification without relying on retrospective classification alone. Each algorithmically flagged episode was then verified against historical sources.
Local projections are the main statistical technique used to trace the long-run fiscal path following military booms. The method estimates how a variable (here, tax revenues and top income rates) evolves over time following an identified shock. It is well suited to the protracted dynamics Trebesch and Marzian observe: tax rates rising over a decade or more after a military buildup and, critically, not returning to pre-boom levels once the spending episode ends.
Exogenous military shocks are the basis of the paper's causal identification strategy. To separate the fiscal effects of military spending from broader economic conditions, the authors distinguish episodes triggered by external geopolitical events from those driven by domestic factors. France's rearmament in the mid-1930s, forced by Nazi Germany's military expansion regardless of French domestic politics, is used as an example of an exogenous peacetime boom. Germany's own rearmament in the same period would not qualify as exogenous, since Germany initiated the shock. The same logic applies to wars: a country attacked faces an exogenous event; the attacker does not.
More VoxTalks Economics episodes

In Can Europe Defend Itself?, featuring Moritz Schularick, Christoph’s colleague from the Kiel Institute, we examine whether Europe has the industrial and strategic capacity to convert its rearmament commitment into credible deterrence, and what European rearmament could mean in practice. 
Related reading on VoxEU

Defence spending: no free lunch, a VoxEU column arguing that increased military expenditure adds modestly to near-term economic activity while adding to fiscal pressure; lasting economic benefits from rearmament are far from guaranteed.
Macroeconomic impacts of defence spending, a VoxEU column modelling the EU-wide effects of raising NATO members' defence spending to 5% of GDP by 2035; projected GDP gains are modest and come at the cost of higher debt-to-GDP ratios.
Converging military spending and its fiscal consequences, a VoxEU column examining long-run trends in military expenditure across countries and the fiscal footprint they leave behind.
The economic effects of military support for Ukraine: evidence from fiscal multipliers in donor countries, a VoxEU column finding that spending multipliers for military expenditure can exceed those for other categories of public spending.