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Mass Migration, Commodity Market Integration and Real Wage Convergence: The Late Nineteenth Century Atlantic Economy

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  • Jeffrey G, Williamson
  • Kevin O'Rourke
  • Timothy J. Hatton

Abstract

As part of a process that has been at work since 1850, real wages among the current OECD countries converged during the late 19th century. The convergence was pronounced as that which we have seen in the post World War Il period. This paper uses computable general equilibrium models to isolate the sources of that economic convergence by assessing the relative performance of the two most important economies in the Old World and the New -- Britain and the USA. It turns out that between 1870 and 1910, the convergence forces that mattered were those that generated by commodity price convergence, stresses by Eli Heckscher and Bertil Ohlin, and mass migration, stressed by Knut Wicksell. It turns out that offsetting forces were contributing to late 19th century divergence, a finding consistent with economic historians' traditional attention to Britain's alleged failure and America's spectacular rise to industrial supremacy. The convergence forces, however, dominated for most of the period.

Suggested Citation

  • Jeffrey G, Williamson & Kevin O'Rourke & Timothy J. Hatton, 1993. "Mass Migration, Commodity Market Integration and Real Wage Convergence: The Late Nineteenth Century Atlantic Economy," NBER Historical Working Papers 0048, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberhi:0048
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    2. Joanna Wolszczak-Derlacz, 2009. "Does migration lead to economic convergence in an enlarged European market?," Bank i Kredyt, Narodowy Bank Polski, vol. 40(4), pages 71-87.
    3. Yoshiaki Nakada, 2018. "Deriving the factor endowment--commodity output relationship for Thailand (1920-1927) using a three-factor two-good general equilibrium trade model," Papers 1810.04819, arXiv.org.
    4. Joshua L. Rosenbloom, 1996. "The Extent of the Labor Market in the United States, 1850-1914," NBER Historical Working Papers 0078, National Bureau of Economic Research, Inc.
    5. Hatton, Timothy J. & Wheatley Price, Stephen, 1998. "Migration, Migrants and Policy in the United Kingdom," CEPR Discussion Papers 1960, C.E.P.R. Discussion Papers.
    6. Mario Sanchez, 2003. "Internal Migration, Return Migration, and Mortality. Evidence from Panel Data on Union Army Veterans," NBER Chapters, in: Health and Labor Force Participation over the Life Cycle: Evidence from the Past, pages 203-230, National Bureau of Economic Research, Inc.
    7. White, Eugene N., 1996. "The past and future of economic history in economics," The Quarterly Review of Economics and Finance, Elsevier, vol. 36(Supplemen), pages 61-72.
    8. Coulombe, Serge & Lee, Frank C., 1998. "Évolution à long terme de la convergence régionale au Canada," L'Actualité Economique, Société Canadienne de Science Economique, vol. 74(1), pages 5-27, mars.

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