E XECUTIVE S UMMARY
Dodeficit-financedgovernment fiscalstimulusprogramsactuallystimulate theeconomy?Thisstudyexhaustivelytestsawidevarietyofdifferent stimulusmodels,testingthemindifferenttimeperiods,andusingdifferent regressiontechniquesinanattempttoanswerthisquestion.Fiscalstimulus programsexaminedincludeboththosethatcuttaxesandthosethat increasegovernmentspending.
Mostmodelsthatpredictgovernmentdeficitswillstimulatetheeconomy areKeynesian.Aprincipalcharacteristicisthattheyaredemand-driven. Eachoftheirkeystructuralequationsindicateincreasesindemandwilllead toincreasedsupply(andemployment),atleastuptofullemploymentof resources.Henceadeficit,whichincreasesgovernmentdemandbyincreasinggovernmentspending,orincreasesprivatedemandbycuttingtaxes, stimulatestheeconomy,accordingtostimulustheory.
Intestingwhetherthesestimulusprogramsactuallywork,wetookcare totestequationstakenfromtheKeynesianmodel.Thisgivesthestimulus effectsofdeficits,shouldtheyexist,thebestpossiblechanceofbeing verifiedempirically.1960–2010dataontheUSeconomywereused.A totalof228modelsofthedeterminantsofconsumption,investmentand theGDPweretested.Thesemodelsdifferinthevariablesincluded,thetime periodtested,theregressiontechniquesused,theleveloftheeconomy whentestingandthespeci fictypeoftaxcutorspendingstimulusused.Each modelisreportedindetail,withdifferencesineachsubsequentmodel comparedtothelasttested.Differencesinresultsarecomparedaswell. Theworkislengthy,butnecessarilyso.Ourgoalwastotestevery
conceivablemodelreadersmightfeelstoodachanceofshowingpositive stimuluseffects.Thatway,whateverourresultsturnedouttobe,itwould bedifficulttoarguewedidnotexamineawideenoughbreathofstimulus programstogivethemafairchancetoshowwhattheycando.
Intheory,theeffectivenessofstimulusprogramscanbecurtailedby “crowdout”.Crowdouttheorysuggeststhatwhatevertheirstimulus effects,governmentdeficitshavetheundesirableresultofsimultaneously reducingprivatespending,becausefundsnormallyborrowedbyconsumers andbusinessesmustbeusedtofundthedeficit.Reducedprivateborrowing inturncausesareductioninconsumerandbusinessspending,offsettingthe deficit’sstimuluseffects.
Intestingtoshowcrowdouteffects,adeficitvariableisaddedtoeach Keynesianconsumption,investmentorGDPmodel.ThisallowssimultaneoustestingofbothKeynesianstimulusandcrowdouteffects.Eachmodel showsstimulusandcrowdouteffectsseparately,andallowsreadersto directlycalculateneteffectsofstimulusprograms,forexample,theeffects ofreductionsinfederaltaxesonconsumptionspending,controllingfor manyotherfactorsthataffectconsumerspending.Everybodyacknowledgesthepossibilitythatcrowdout, “ifitoccurs”,canadverselyaffect stimulusprograms.Rarelydopeopleactuallytesttoseeifitdoesoccur. Thisbook’suniquecontributionisto exhaustively testtodetermineifitdoes occur,andifso,howseriousaproblemitis.
AsalternativestoKeynesianmodels,wecouldhavetesteddynamic stochasticgeneralequilibrium(DSGE)models,butthesearemodelsthat typicallycontainassumptionsabouthumanbehaviorlikeperfectforesight andintertemporalutilitymaximization,thataredesignedto inferfromthese assumedbehavioralcharacteristics thatstimulusprogramsdon’tworkinthe longrun.Similarly,wecouldhavepickeddifferentcombinationsof fiveor sixvariablesthoughtappropriateandtestedVARmodels.Theproblemhere isthatsinceVARstypicallyarenotrecognizabletheoreticalconstructs,itis hardtoknowwhatyourresultsmean.Bycomparison,weknowwhata Keynesiantheoreticalconstructmeans,andifweslipadeficitvariableintoit andthentest,thetestwilleithershowthevariablestatisticallysignificant (crowdoutmatters)ornot(crowdoutdoesn’tmatter), controllingforall theotherKeynesianinfluences.Inshort,wewillhaveausefulresult,froma fairtest,scientificallyarrivedat.
Whenexamininghowconsumptionorinvestmentspendingvariesas deficitsriseorfall,wecontrolfortheeffectofbusinesscyclevariationon bothgovernmentdeficitsandonprivatespending.Thiswasnecessaryto
unambiguouslyidentifycrowdout’seffects.Adecliningeconomyalonecan causeagrowingdeficitandsimultaneouslydecliningconsumerandbusiness spending,butthatisabusinesscycleeffect,notacrowdouteffectinwhich thedeficit causes thedeclineinprivatespending.Someargueitisonly businesscycleeffects,notcrowdout,whichcausethenegativerelationship betweendeficitsandprivatespending.Theyarguethatwithoutthestimulus programs,theobserveddeclineinprivatespendingassociatedwiththe deficitwouldhavejustbeenworse.Thedifferencebetweenthisandthe crowdoutexplanationhasenormouspoliticalandeconomicimplications forgovernment’sroleintheeconomy.
Methodologically,extensivetestsforendogeneity,stationarityand heteroskedasticitywereundertaken.Testingwasdonein firstdifferences, eliminatingmostnon-stationarityandreducingmulticollinearityproblems byabouthalf.Modelsexplained90–95%oftheyearlychangesofconsumptionandinvestmentduringthe50-yearperiodtested.Fourdifferent, thoughoverlapping,timeperiodsweretested.Findingswereessentially thesameforthe1950sand1960sasforthe2001–10decade,andfor decadesinbetween.Deficitresultswerealsorobustformoderatechangesin thestructureofthemodelstested.Theywerealsogenerallyrobustto differentregressiontechniques(OLS,strongandweakinstrument2SLS), anduseofdifferentstrong2SLSinstruments.Hence,wefeelour findings willbedifficulttorefuteinreasonablywell-constructedfuturemodelsof howtheKeynesiansystemworks.
Our findingsoverwhelminglyindicatethatasgovernmentdeficitsgrow, creatingobservablestimuluseffects,consumerandbusinessspending declinesduetocrowdout,fullycancellingthestimuluseffects(orworse). Theoffsettingdeclineinprivatespendingappearsdueto “crowdout”,that is,tryingto financebothincreaseddeficitsandtraditionalprivateborrowing levelsfromarelativelyunchangingsizedpoolofloanablefunds.
This findingthatstimulusprogramsdonotworkheldinvirtuallyall circumstancestested.Thespeci fictypeoftaxcutorgovernmentspending deficitdidnotmatter,nordiditmatterifwetestedinrecessionsornormal economictimes.Nordiditmatterwhatparticulardecadessince1960we tested,and,generally,itdidnotmatterifweusedoneregressiontechnique (OLS)versusanother(2SLS)todoouranalysis(thoughasamatterofgood practice,where2SLSisneeded,itshouldbeused).Withrareexceptions, usuallyduetostatisticalproblemslikemulticollinearity,noneofthese variationsinthemodelswetestedresultedinanetpositiveeffectfortax
cutorspendingincreasestimulusprograms.Invirtuallyallcases,results indicatedcrowdoutfully,ormorethanfully,offsetstimuluseffects.
Examinationofthe1981–83recessionperiodindicatesthepoolof loanablefundsdropsevenfasterinrecessionsthanbusinessandconsumer loandemand.Hence,newdeficit financingdemandsonthepoolofloanable fundsinrecessions,ifanything,causeevenbiggercrowdoutproblemsthan innormaltimes.Thedataexaminedsupportthisconclusion.
Themodelsfromwhichweobtainedtheseresultsalsoexplainextremely wellthebehaviorofconsumptionandinvestmentduringthe2007–09 economiccrisis.Oureconometric findingssuggestthatdeficit-financed stimulusprogramssuchasthe2009Obamastimulusprogramhavea substantialnegativeeffectontheGDP,raisingunemployment2.26–2.94%duringtheperiodtheyareinforce.Deficitshavethisundesirable resultbecausetofundthem,fundsnormallyborrowedbyconsumersand businessesareused.Reducedborrowingbyconsumersandbusinessesin turncausesareductionintheirspending,offsettingthedeficit’sstimulus effects.
Worse, “lumpiness” inborrowingtendstoresultinprivatespending reductionsevengreaterthanthestimulus’ positiveeffects,leadingstimulus programstohaveanetnegativeimpactontheeconomy.Bylumpinesswe meanthefollowing:consumerswhoneedtoborrow$10,000tobuyanew car,but findthattheirbankcanonlylendthem$9000(becausetheylent theother$1000tothegovernmentto financea$1000stimulusprogram), willnotbuythecaratall.Thiscausesprivatespendingtofall$10,000from expectedlevels,afargreaterdropthanthestimuluscanoffset.
Chapter 16 providesamoredetailedsummaryof findingsand conclusions.
¼ β Y T ðÞþ λ T G ðÞð
Lambda(λ)representsthemarginalcrowdouteffectofthegovernment deficitonconsumerdemand(spending).Withthisfunction,thesimple KeynesianCrossmodelbecomes
Fromwhichwecaneasilyseethattheimpactofachangein T or G onthe GDPdependsonthemarginalcrowdouteffect(λ)aswellasthemarginal stimuluseffect(β ).Thetaxmultiplier,showingthemarginalimpactofachange intaxesisnow( β + λ1)/(1 β ).Thespendingmultiplier,showingthe marginalimpactofachangeingovernmentspending,isnow(1 λ1)/(1 β ). Ifthecrowdouteffectisgreaterthanzero, BothTandGnetmarginalstimulus effectswillbesmaller(inabsoluteterms)thantheywouldhavebeenwithoutcrowd outeffects.
Wecanexpandthismodeltoincludeeffectsofcrowdoutoninvestment spending.Assumeasimpleinvestmentmodelinwhichinvestmentisdeterminedbyonlythreevariables:theaccelerator(ACC),realinterestrates(r) andaccesstocredit,whichvarieswiththegovernmentdeficit(T G ).
wheregamma(γ )indicatesthemarginaleffectofcrowdout(thegovernmentdeficit)oninvestmentspending,and(θ 1,θ 2)representsthemarginal effectsofrealinterestratesandtheaccelerator.
ReplacinginvestmentandconsumptionintheGDPidentitywiththeir hypothesizeddeterminants,weobtainatypicalKeynesianISequation:
InthisISequation,thenormalstimulatingimpactoftaxcutsonthe GDP( β )isoffsetinpartbytheeffectsofdeficit-inducedchangesincredit availabletoconsumersandinvestors(λ + γ ). Taxstimuluseffectsmayswitch fromnegativetopositiveifthecrowdouteffects(λ þ γ )arelargerthanthe disposableincomeeffect( β ). Theeffectofachangeingovernmentspendingisalsoreducedperdollarofexpenditurefromjustthestimuluseffect (1)tothateffectnetofcrowdouteffects( λ γ ).Netstimuluseffectsmay bereduced ormayevenswitchfrompositivetonegativeifcrowdouteffects exceedthestimuluseffect.Thenetexportsstimuluseffect(also1)staysthe same,nowbecomingrelativelystrongerrelativetogovernmentspendingor taxcuts.ResultsareshowninTable 2.2.
Simpleextensionsofthismodelallowfordifferenteffectsoftaxcutand spendingincreasedeficits(seeChaps.6and8),differenteffectsduring recessionandnon-recessionperiods(Chaps.14and15),anddifferent kindsoftaxcutsorspendingincreases(Chaps.3,p.10;5.12,p.29;10.3, p.98and16,p.116).
Thereareanumberoftheoreticalreasonswhy λ1 and λ2 mayleavethetax coefficientzeroorpositive,andthespendingcoefficientzeroornegative. Discontinuitiesmaycauseprivateborrowing(andthereforespending)to declinemorethanthedeficithasreducedloanablefunds:abankmayonly beabletolendaconsumerpartofwhatisneedtobuyanewcar,butthis reducescarspendingbythewholeamount.Also,inadditiontothedecline inprivatespendingresultingfromthestimulus,stimulusdollarsmayonlybe usedtomaintainpreviousspendinglevelsamongstimulusaidrecipients.In
Table2.2 SimpleKeynesianmechanicswithandwithoutcrowdout
thiscase,theneteffectofthestimulusiszero,sincewithoutthedeficit, privatespendingoutofborrowedmoneywouldnothavedeclined,but privatespendingbystimulusrecipientsmighthave.Finally,evidenceindicatesthatevenholdingincomeandeconomicconditionsconstant,private spendingvarieswithavailabilityofborrowing.Chapters8.3,p.88,10.1, pp.92–93and16,p.123presentmoredetailontheoryofcrowdout.
CHAPTER3
LiteratureReview
Thevalidityofstimulustheoryhangsheavilyonwhetherdeficitscrowdout privateborrowing,andtherefore,privatespending.Wecould find no seriousscienti ficworkdirectlytestingtheimpactofdeficitsonprivate borrowing ,andrelativelylittleprofessionallevelworkdonetestingthe relationshipbetweenprivatespendinganddeficits,consideringthepolicy importanceofthetopic.Asnotedearlier,OttoEckstein,whofatheredthe 800-equationDataResources,Inc.(DRI)large-scalemacroeconomic model,notedthesameproblem30yearsago: Does fiscalpolicywork?Ordoesthe financingofdeficits “crowdout” privateactivity.Thishasbeenoneofthemoredurablecontroversiesin macroeconomictheory.(1983,p.35)
3.1P OPULAR P RESS
Thepopularpressis filledwithseeminglyendlessdiscussionofcrowdout effectswhenstimulusprogramsareproposed,typicallybasedonthe assumptions, notscience,aboutwhethercrowdoutdoesordoesnotwork.Afew typicalexamplesinclude:
1. Chan,S. (NYTimes, 2/7/10,p.A16):ChannotedtheIMFhad indicatedthat “risinggovernmentdebtcouldcrowdoutprivate borrowingandraiseinterestratesforprivateborrowers,andslow downeconomicrecovery.”
© TheAuthor(s)2017
J.J.Heim, CrowdingOutFiscalStimulus, DOI10.1007/978-3-319-45967-7_3
11
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F 307 Rhizome of Polygonatum multiflorum: a bud; b shoot; c d scars left by shoots of previous years
F . 308. Smilax pseudosyphilitica: A shoot of male plant; C ♂-flower; D berry, almost ripe; E the same in longitudinal section. B Smilax syphilitica: portion of branch with base of leaf and tendrils.
B. A , A G . Scale-like leaves and green assimilating branches.—Asparagus: horizontal rhizome. The aerial shoots are very richly branched; the numerous needle-like bodies
upon the plant are leafless shoots, which are crowded together in double scorpioid cymes in the axils of the scale-leaves; the two first lateral axes, placed outside to the left and right, generally bear flowers. Polygamous.—Ruscus (Butcher’s broom) is a S. European shrub with leaf-like, ovoid or elliptical shoots (phylloclades) which are borne in the axils of scale-like leaves, and bear flowers on the central line Diœcious Stamens 3, united, anthers extrorse Semele androgyna bears its flowers on the edge of the flat shoot.
C. S . Smilax (Sarsaparilla) (Fig. 308); climbing shrubs with the leaf-sheath produced into tendrils. The leaves have 3–5 strong nerves proceeding from the base, and are reticulate. Orthotropous or semi-anatropous ovules. Diœcious (Fig. 308 C, E).
D. D . Fruit in some a berry, in others a capsule. The stem of D , when old, has the appearance of being dichotomously branched; it has the power of increase in thickness, and may become enormously thick. The Dragon-tree of Teneriffe, measured by Humboldt, attained a circumference of 14 m. and a height of 22 m.; the leaves are large, linear or linear-lanceolate. Cordyline (East Asia), various species in gardens and greenhouses (Yucca is closely allied). Astelia.
P . Paris quadrifolia and Convallaria majalis have no honey, and are chiefly visited by pollen-collecting bees (in the absence of insect visits selfpollination takes place); Polygonatum multiflorum has honey secreted by septal glands and protected by the base of the tubular perianth; it is pollinated by humblebees, etc. Asparagus officinalis has small, polygamous, greenish, honey-bearing flowers; the ♂-flower is almost twice as large as the ♀; both have rudiments of the opposite sex.
About 555 species; especially from N America, Europe, and Central Asia
O : “Dragons’-blood,” a red resinous juice from the stem of Dracæna and the roots of some Central American species of Smilax. The tuberous stems of the Eastern Asiatic Smilax glabra are officinal. The flowers of Convallaria majalis have been lately used as a substitute for Digitalis. Pungent, poisonous properties are possessed by Paris None of the species are used as food, except the young annual shoots of Asparagus officinalis, a shore-plant which is used as a vegetable
Order 4. Pontederiaceæ. Flowers generally zygomorphic, hypogynous, ☿, with handsome, white or violet, petaloid perianth which forms a tube at its base. The stamens are inserted at different heights in the perianth-tube, and are reduced to three (in Heteranthera seldom to one). In some the ovary is trilocular with ∞ ovules (Eichhornia), in others reduced to one loculus with one ovule (Pontederia) Fruit a
capsule or nut. Embryo as long as the abundant, mealy endosperm. Tropical water-plants (22 species) with peculiar sympodial branching, nearly the same as in Zostera Spikes without floral-leaves Many intercellular spaces in the stem and leaf In greenhouses: Eichhornia azurea, E crassipes (both from tropical and sub-tropical S America); the latter has swollen petioles which serve as floats and enable it to float freely on the water, sending down its roots into the mud Heteranthera reniformis, H zosterifolia Pontederia cordata
Order 5. Amaryllidaceæ (Narcissi). The flower is epigynous, otherwise exactly the same as in the Liliaceæ (6 stamens). The majority, like these, are also perennial herbs with bulbs and scapes. The fruit and the other characters as in the Liliaceæ. The external appearance is, however, very different.
A. A have bulbs and the leaves generally arranged in two rows; the flowers are borne singly or in umbel-like inflorescences on lateral scapes, while the main axis of the bulb is unlimited. Beneath the inflorescence is an involucre (Fig. 309).—Galanthus, Snowdrop, has a polyphyllous perianth without corona; the three inner perianth-leaves are emarginate and shorter than the outer; the anthers dehisce apically. Leucojum differs in having the perianth-leaves equal in length Amaryllis has a funnel-shaped perianth, entirely or nearly polyphyllous, but somewhat zygomorphic Crinum; Hæmanthus; Clivia —Narcissus has a tubular corona, a ligular structure arising from the perianth-tube exterior to the outer stamens. In Pancratium (Fig. 309) the corona is united with the filaments which appear to spring from its edge Eucharis amazonica
F . 309.—Pancratium caribæum.
B. H . The leaves, which are grass-like, dry, folded, and in some hairy, spring from a rhizome, generally with a divergence of 1/3. Flowers small, perianth polyphyllous, persistent, on which account perhaps the Hypoxideæ may be considered as the least altered type The chief characteristic is that the embryo is separated from the hilum Hypoxis; Curculigo (C recurvata, a favourite ornamental plant; S E Asia)
C. A . (Alstrœmeria, Bomarea); stems long, leafy, often climbing.
D. V (Vellosia, Barbacenia); stem woody, usually dichotomously branched, with terminal, single flowers; it bears numerous aerial roots which pierce the leaves and surround the stem Stamens often (by splitting) 6–18 High tablelands of S. America and S. Africa.
E. A . Very similar to the Bromeliaceæ both in their distribution (nearly all American) and in external appearance. They appear as gigantic bulbous plants with perennial, aerial, generally short stem, and perennial, large, lanceolate or linear, stiff, thick, and often thorny leaves, which form a large rosette; after the course of several (8–20) years the terminal inflorescence is developed, which is 10–12 m high, paniculate, and freely branched Before the inflorescence expands, a large quantity of sugar-containing sap is collected from A americana by removing the terminal bud; this on distillation yields “pulque,” the national drink of Mexico After flowering the entire shoot dies, but the subterranean lateral shoots survive and reproduce the plant.—Agave americana, etc.; Fourcroya; Polianthes tuberosa (Tuberose; Central America).
D . The 650 species are chiefly natives of S. Africa and S. America. Clivia, Hæmanthus, Amaryllis are from the Cape; Narcissus from S Europe, whence many species have been introduced; Galanthus and Leucojum are especially from S and Central Europe, and from the Caucasus
U , few, except as ornamental plants: Galanthus nivalis; Leucojum; Narcissus pseudonarcissus, N. poeticus, N. jonquilla, N. tazetta, etc.; Amaryllis, Alstrœmeria, Eucharis, Crinum, Vallota, etc. The vascular bundles of the various species of Agave (Agave rigida, var. sisalana, sisal hemp,) are used for cordage, etc.
Order 6. Bromeliaceæ. The flowers are hypogynous, epigynous or semi-epigynous; the perianth is divided into calyx and corolla; stamens 6. The fruit is a capsule or berry with many seeds. Endosperm mealy, embryo small, at the edge of the endosperm, but not enclosed by it.
F . 310. Aechmea miniata.
F . 311. Multiple-fruit of Ananassa sativa.
Perennial herbs with a very characteristic appearance (Fig. 310); the stem is most often short, thick, and crowned by a rosette of many leaves, which are long, often very narrow, leathery, stiff, and with a spiny edge; they are usually channeled, completely closing round each other, with their edges forming a tightly closed hollow, in which generally water is collected (this among other things insulates the inflorescence and thus prevents the access of creeping insects, such as ants). The presence of numerous stellate, water-containing hairs often gives the leaves a grey appearance, and the layers of cells beneath the upper epidermis of the lamina form an “aqueous tissue,” which serves as a protection against the rays of the sun and
regulates the evaporation. The stomata are often situated in furrows on the underside of the leaf, and hence cause a striped appearance. They are all American (525 species), especially from S. America, where they live partly as epiphytes on trees, partly in the clefts of rocks, often on the steepest slopes, to which they firmly attach themselves by aerial roots; some are terrestrial. The stem is seldom tree-like or many metres in height (Puya, in Chili; Hechtia, in Mexico). The inflorescence is a terminal spike, raceme, or panicle, often with large and brightly-coloured floral-leaves. The flowers are without scent. The seeds, in the species whose fruit is a capsule, are often provided with wings (hairs, expansions, etc).—Ananassa sativa, Pine-apple (W. Indies, Central America) is cultivated for the sake of its juicy, aromatic fruits, which coalesce with their fleshy bracts and form a large spike-like fruit-cluster (multiple-fruits,[29] Fig. 311) bearing on its apex a leafy shoot, which may be used as a cutting. Seeds very rarely developed.—Tillandsia (T. usneoides is a filamentous, richly branched, rootless epiphyte hanging in masses from trees; Trop. Am.), Aechmea, Billbergia, Pitcairnia, etc.
U . The leaves of the Pine-apple, in its native country, are used for the manufacture of cloth.
Order 7 Hæmodoraceæ. 120 species; in all parts of the world except Europe; perennial, often tomentose and resembling the Bromeliaceæ, Iridaceæ and Amaryllidaceæ Hæmodorum (Australia) To this order belong Ophiopogon, Peliosanthes, Sanseviera, and others
Order 8. The Iridaceæ have epigynous, hermaphrodite flowers with petaloid perianth as in the Amaryllidaceæ, but the interior whorl of stamens is entirely suppressed, and the 3 developed outer stamens have extrorse anthers (Fig. 279); there is 1 style with 3 large, generally more or less leaf-like branches bearing the stigmas. Ovary and capsule as in the Amaryllidaceæ and Liliaceæ.— Perennial herbs; bulbs are rarely found, but horizontal rhizomes, corms, etc., take their place. The leaves are (except Crocus) as in the Iris, two-rowed, equitant and sword-like. Flowers or inflorescences terminal.
The Iris (Flag) has a horizontal rhizome. The flowers are borne in the leaf-axils in fan-like inflorescences (rhipidium). The branches of
the style are large and petaloid; on their under surface may be seen a small projecting shelf (Fig. 312 a) having on its upper surface the stigmatic hairs. Beneath the branches of the style are 3 well protected stamens, and immediately outside these the external perianth-leaves. The honey is secreted in the perianth-tube, and the insects, endeavouring to obtain it through the narrow passages at the base of the stamens, settle upon the outer perianth-leaves, which are bent backwards and often very hairy along their central line. The insects then rub their backs on the anthers just above them, beneath the branches of the style; they readily deposit the pollen on the stigma of another flower as they enter it, but cannot do so in withdrawing, since the stigma is pushed back, and self-fertilisation is thus avoided The stylar branches lie close to the outer perianth-leaves, which are just beneath them, or separated by a distance of only 6–10 mm.; the first form of flower is adapted for Rhingia rostrata, the latter for bees.—Crocus has vertical, tuberous, underground stems surrounded by the leaf-sheaths (corms), and terminal flowers; the linear leaves are not equitant, but have two longitudinal furrows on the under side. The perianth is gamophyllous and funnel-shaped. The stylar branches (stigmas) are fleshy, rolled together in the shape of a horn, and split along the edge.—Gladiolus has corms like the Crocus; spikes with slightly zygomorphic, almost bilabiate flowers, most frequently turning to one side. Position of the leaves as in the Iris.—Diplarrhena has 2 fertile and 1 barren stamen; Hermodactylus has a unilocular ovary with 3 parietal placentæ. Cypella and Tigridia have bulbs
F 312 Iris pseudacorus One external and two internal perianth-leaves, and one of the stylar-branches have been removed, y The outer, i the inner perianthleaves; g stylar-branch; a stigma; s anther The ovary is seen in longitudinal section
770 species; chiefly in the countries round the Mediterranean, and in Africa, especially the Cape (Gladiolus, Ferraria, Moræa, Galaxia, Sparaxis, Antholyza, Tritonia, Ixia, etc.), Australia and Tropical America (Sisyrinchium, Tigridia, Cipura, Cypella, etc) A great number are ornamental plants: the cultivated Crocus-species are from the South of Europe and Asia; Gladiolus communis from S Europe; the other species principally from S Africa The native species of Iris are I pseudacorus (yellow) and I fœtidissima
O : the stigmas of Crocus sativus (Oriental, cultivated in France, Spain, Italy, and Austria), used as a colouring matter, saffron; the rhizomes of the S. European Iris florentina, pallida, and germanica (“Orris-root”).
F 313 —Dioscorea batatas: A ♂-plant; B ♂-flower; C ♀-plant (nat size); D, E ♀-flowers (mag ); F seed; G embryo
Order 9. Dioscoreaceæ. Perennial herbs with fleshy, often very large tuberous rhizomes (or roots); twining stems; leaves stalked, often arrow- or heart-shaped, lobed, palminerved and finely reticulate as in the Dicotyledons (Fig. 313). The flower is diclinous (most frequently diœcious), regular, epigynous, small, and of a greenish colour, but otherwise typical (Pr3 + 3, and A3 + 3, or G3); in most instances 2 ovules are placed one above the other in each loculus. The inflorescence is a spike or raceme, sometimes richly branched and paniculate.—The order approaches most nearly to the Amaryllidaceæ.
Tamus (Bryony) has a berry, Dioscorea (Yam) a thin-walled, 3edged or 3-winged capsule (Fig. 313). Both have subterranean or aerial tubers; the Yam very often also developes tubers in the axils of the foliage-leaves; tuberous roots are said to occur in D. batatas.
The tubers of many species of Yams (D. batatas from China and Japan, D. alata, South Sea Islands and India, D. bulbifera) are a very important source of food in the Tropics, especially the first-named.— Testudinaria; Rajania.—The tuberous stem of Tamus communis and Testudinaria elephantipes, and some species of Dioscorea is formed from one single internode (epicotyl), and the aerial shoots are developed from adventitious buds; in T elephantipes the stem is aerial, and covered with thick scales of cork, regularly arranged, and separated by grooves.
Tropical order (167 species); 2 species (Tamus communis and Borderea pyrenaica) in Europe
Family 6. Scitamineæ.
The flowers belong to the ordinary monocotyledonous type. They are hermaphrodite, epigynous, and have either a petaloid perianth, or calyx and corolla; they are, however, zygomorphic or unsymmetrical, and of the stamens most frequently only one is completely developed, the others being generally represented by petaloid staminodes. The ovary has 3 loculi, more rarely it is unilocular with the suppression of 2 loculi. Endosperm is absent (except Zingiberaceæ); but, on the other hand, there is a large perisperm. To this family belong large, glabrous, especially perennial herbs with rhizomes; leaves large, distinctly divided into sheath, stalk, and blade, the latter being more or less elliptical or lanceolate, entire, with pinnate venation, and always with a very wellpronounced midrib, gradually tapering towards the apex, and giving off numerous branches, which run outwards, towards the margin, at a larger or smaller angle; these lateral veins are closely packed, and parallel, but with only weak, connecting branches between them; the leaves, therefore, are easily torn pinnately (Figs. 314, 317). The leafsheaths close tightly round each other and form a false stem.
This very natural family comprises orders closely connected with each other, but is not itself nearly allied to any other family. First in the series stands:—
Order 1. Musaceæ. The petaloid perianth is strongly zygomorphic, the anterior leaf being very large (a kind of “labellum”),
the posterior one small; only the posterior stamen is wanting, or is rudimentary, the other five are developed, and have quadrilocular anthers; ovary, 3-locular. Seed with straight embryo in mealy perisperm.
F 314 Two Musa-species
The best-known genus is Musa, the Banana (Fig. 314). From the short rhizome arise enormously large, spirally-placed leaves, whose sheaths envelope one another, and form an apparently aerial stem, several metres in height. The inflorescence is a terminal spike with floral-leaves placed spirally, and sometimes magnificently coloured; in the axils of each of these several flowers are situated in two transverse rows (accessory buds); the lowest flowers in the inflorescence are ♀, the central ones ☿, the upper ones ♂, so that fruits are only found in the lower region of the inflorescence, the remaining portion persisting as a naked axis after the floral-leaves and flowers have fallen off; the inflorescence terminates in an ovoid bud formed by the flowers which have not yet opened (Fig. 314, the left-hand figure). The perianth-leaves are united (except the posterior one). The fruit (known as a “Banana”) is a berry, having the form of a smooth, short, three-cornered Cucumber (as much as 30 cm. in length); inside the tough skin is found a farinaceous, aromatic pulp. No seed is developed in the cultivated species.—Several Musa-species are cultivated in the Tropics for the sake of the fruit (M. paradisiaca, M. sapientum); for the fibrovascular bundles, M textilis (Manilla Hemp) Their home is, no doubt, the Tropics of the Old World; they were introduced into America before the arrival of Europeans. Musa ensete has dry, leathery fruits; an ornamental plant.
In Musa the barren, posterior stamen belongs to the inner whorl; and also in Strelitzia and Ravenala; the latter may have all 6 stamens developed. In Heliconia, on the contrary, it belongs to the outer whorl; in Heliconia the perianth-leaves are differently arranged, and there is only one ovule in each loculus. The three latter genera have dry fruits and leaves arranged in two rows. In the “Travellers’ Palm” (Ravenala madagascariensis) the foliage-leaves form an enormous fan. Tropical; about 50 species.
The order may be divided as follows:—1. Museæ: Musa, Ravenala, Strelitzia in the Old World. 2. Heliconiæ: Heliconia in the New World.
F 315 Diagram of a Zingiberaceous flower (Kæmpferia ovalifolia): b bract; v bracteole; k calyx; p1 , p2 , p3 the petals; sst, lateral staminodes (“wings”); lab labellum (formed of two staminodes); st the fertile stamen; * position of suppressed stamen. The ovary is in the centre of the diagram.]
Order 2. Zingiberaceæ. Perianth most frequently divided into calyx and corolla. Calyx gamosepalous. Only 1 fertile stamen (the posterior, Fig. 315, belonging to the inner whorl) with quadrilocular anther, which encloses the style in a furrow; the 2 stamens in the outer whorl are staminodes, the median one (the anterior) is wanting. The 2 lateral staminodes of the inner whorl form the “labellum” (Fig. 315 lab), which usually is the largest segment of the flower, and is often bilobed. Ovules many. The fruit in some is a leathery, 3-valved capsule, with loculicidal dehiscence; in others it is more or less berry-like and indehiscent, or irregularly dehiscent. Straight embryo. —The aerial stem is seldom developed to any extent, and the inflorescences, which are (compound) spikes or racemes, often with coloured floral-leaves, spring in some (e.g. Zingiber officinale) directly from the rhizome. The leaves are arranged in two rows.—
The ovary in a few instances (Globba and others) is unilocular, with 3 parietal placentæ.
They are perennial herbs with fleshy and tuberous rhizomes, which are used as condiments and in medicine on account of their pungent and aromatic properties and also for starch, dyes, etc. O : rhizomes of Zingiber officinale (Ginger, unknown wild, but cultivated generally in the Tropics), of Curcuma longa (Turmeric, a dye, E India) and C zedoaria, of C angustifolia and others (as E India Arrowroot), of Alpinia officinarum, China (galangal) “Preserved Ginger” from Alpinia galanga Similar aromatic materials (volatile oils) are present also, for example, in the fruits; Cardamom fruits and seeds (from Elettaria cardamomum, China, seldom from E major)
315 species; Tropics, preponderating in the Eastern Hemisphere, India, and especially S. Asia, whence all the aromatic species originate; they are now commonly cultivated in the Tropics. Some are ornamental plants in greenhouses, e g Hedychium, Costus, etc Globba (with axillary buds in the inflorescence, as in Ficaria), Renealmia, Kæmpferia
F . 316. Flower of Canna: f ovary; pa calyx; pi corolla; l labellum; st stamens; an anther; g stigma; α and β staminodes.
Order 3. Cannaceæ. American herbs without aromatic properties. Flowers asymmetric (Fig. 316). Calyx polysepalous. The stamens are petaloid (Fig. 316 st) and barren with the exception of one (the posterior), which bears on one of its edges a bilocular anther; another, which is especially large and coloured, is termed the labellum. The style is compressed and leaf-like, with a small stigma at the apex. Ovules numerous in the 3 loculi. The capsule is furnished with warts or soft prickles. Embryo straight.
Canna (30 species; Trop. Am.). The inflorescence is a terminal spike with 2-flowered unipared scorpioid cymes in the axils of the floral-leaves. Ornamental plants: Canna indica, etc.
The diagram of the andrœcium of the Cannaceæ and Marantaceæ may be represented in the following manner (calyx,
corolla and gynœceum being omitted):—
C . M .
w The lateral staminodes, “wings;” st fertile stamen; * the suppressed stamen; lab labellum; c hood; wi inner-wing
The labellum of the Cannaceæ corresponds with the hood of the Marantaceæ and not with the labellum of the Zingiberaceæ.
Order 4. Marantaceæ. The flower is asymmetrical. Only 1 or 2 of the 3 stamens in the outer whorl are present as staminodes; in the inner whorl 2 are petaloid and of the sixth stamen one-half is developed as a staminode and the other half bears a bilocular anther. One ovule only in each loculus. The style is strongly curved and at first enclosed in one of the staminodes (hood) of the inner whorl; later on it springs elastically forward towards the other staminode (inner-wing) of the same whorl. The stigma is very oblique or 2-lipped. Two of the three loculi of the ovary, in some (Maranta, Thalia) become small and empty. Embryo curved. Leaves in two
F 317 Calathea zebrina
rows, with sheath, stalk, and blade (Fig. 317); at the base of the last is a characteristic swelling (articulus).—Phrynium, Calathea, Stromanthe, Ctenanthe, Saranthe, etc. About 150 species; tropical, especially America. The starch of the rhizome of Maranta arundinacea is , “West Indian Arrowroot.”
Family 7. Gynandræ.
The flowers are hermaphrodite and constructed on the ordinary 3merous, pentacyclic type with petaloid, epigynous, strongly zygomorphic perianth, and generally one-stamened by the suppression of the other 5 stamens. The family has derived its name from the fact that the stamen is united with the style into a “stylar column” (except Burmanniaceæ). All are herbs; many grow as epiphytes on other plants.
This family and the Scitamineæ occupy correspondingly high positions among the Monocotyledons; these two families may therefore be placed close together, although one cannot be derived from the other The first of the two orders is very small, but the second is very rich in species. The Apostasieæ are best classed with the Orchidaceæ and have no independent place.
Order 1. Burmanniaceæ. This order forms a transitional link between the Gynandræ and the epigynous Liliifloræ (Amaryllidaceæ), in having a 6-leaved perianth, and 6–8 stamens; but some have a labiate perianth (the median perianth-leaf of the outer whorl being very large). The ovary is most frequently unilocular with three parietal placentæ; but in some it is 3-locular with axile placentation. Capsule. Seeds ∞, small, with endosperm. The relationship to the Orchidaceæ is shown especially in the very imperfectly developed embryo and in the ovary. Small, tropical herbs (59 species); some are saprophytes.
