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Globalisation, inequality and Swedish catch up in the late nineteenth century. Williamson’s real wage comparisons under scrutiny

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  • Larsson, Svante

    ()
    (Department of Economic History, School of Economics and Commercial Law, Göteborg University)

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    Abstract

    The idea of rapid factor price convergence in the latter half of the nineteenth century stems from an article from 1995 by Jeffrey Williamson. That article presented real wage comparisons of unskilled urban workers for seventeen countries. Sweden, along with the rest of Scandinavia, appeared to be an influential case in accounting for much of the alleged factor price convergence taking place. This paper takes a closer look at all the three steps that have to be accomplished in order to establish real wage comparisons focusing on Sweden in relation to the US and the UK. The most important finding is twofold. First, that the US-Sweden wage gap is considerably smaller for industrial than for building workers, and second, that the rate at which Sweden’s real wages approached the American and the British has been overestimated. Swedish real wages did grow rapidly, but not as rapidly as Williamson’s comparison will have us to believe, because his real wage series does not constitute a representative account of the Swedish real wage experience. I argue that as we suffer from a serious paucity of data for narrow and thereby comparable selections of unskilled workers resorting to encompassing wage measures is a more viable option.

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    Bibliographic Info

    Paper provided by University of Gothenburg, Department of Economic History in its series Göteborg Papers in Economic History with number 2.

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    Length: 29 pages
    Date of creation: 08 Nov 2005
    Date of revision:
    Handle: RePEc:hhs:gunhis:0002

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    Postal: Department of Economic History, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG
    Phone: 031-773 47 50
    Fax: 031-773 47 39
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    Web page: http://www.econhist.gu.se/
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    Keywords: Economic History; Globalisation; Real wage; Convergence; Inequality;

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    1. Broadberry S. N., 1994. "Comparative Productivity in British and American Manufacturing during the Nineteenth Century," Explorations in Economic History, Elsevier, vol. 31(4), pages 521-548, October.
    2. Hanson, John II, 1988. "Third world incomes before World War I: Some comparisons," Explorations in Economic History, Elsevier, vol. 25(3), pages 323-336, July.
    3. Kevin O'Rourke & Jeffrey G. Williamson, 1995. "Open Economy Forces and Late 19th Century Scandinavian Catch-Up," NBER Working Papers 5112, National Bureau of Economic Research, Inc.
    4. Williamson Jeffrey G., 1995. "The Evolution of Global Labor Markets since 1830: Background Evidence and Hypotheses," Explorations in Economic History, Elsevier, vol. 32(2), pages 141-196, April.
    5. R. V. Jackson, 1987. "The structure of pay in nineteenth-century Britain," Economic History Review, Economic History Society, vol. 40(4), pages 561-570, November.
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    7. Feinstein, Charles, 1988. "The Rise and Fall of the Williamson Curve," The Journal of Economic History, Cambridge University Press, vol. 48(03), pages 699-729, September.
    8. Hanson, John II, 1991. "Third world incomes before world war I: Further evidence," Explorations in Economic History, Elsevier, vol. 28(3), pages 367-379, July.
    9. Allen, Robert C., 2001. "The Great Divergence in European Wages and Prices from the Middle Ages to the First World War," Explorations in Economic History, Elsevier, vol. 38(4), pages 411-447, October.
    10. Kevin H. O'Rourke & Jeffrey G. Williamson, 2001. "Globalization and History: The Evolution of a Nineteenth-Century Atlantic Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650592, December.
    11. Baumol, William J, 1986. "Productivity Growth, Convergence, and Welfare: What the Long-run Data Show," American Economic Review, American Economic Association, vol. 76(5), pages 1072-85, December.
    12. Betr N, Concha & Pons, Maria A., 2004. "Skilled and unskilled wage differentials and economic integration, 1870 1930," European Review of Economic History, Cambridge University Press, vol. 8(01), pages 29-60, April.
    13. Margo, Robert A. & Villaflor, Georgia C., 1987. "The Growth of Wages in Antebellum America: New Evidence," The Journal of Economic History, Cambridge University Press, vol. 47(04), pages 873-895, December.
    14. Rosenbloom, Joshua L., 1996. "Was There a National Labor Market at the End of the Nineteenth Century? New Evidence on Earnings in Manufacturing," The Journal of Economic History, Cambridge University Press, vol. 56(03), pages 626-656, September.
    15. O'Rourke, Kevin H & Taylor, Alan M & Williamson, Jeffrey G, 1996. "Factor Price Convergence in the Late Nineteenth Century," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(3), pages 499-530, August.
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