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Between Conquest and Independence: Real Wages and Demographic Change in Spanish America, 1530-1820

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Author Info

  • Leticia Arroyo Abad
  • Elwyn A.R. Davies
  • Jan Luiten van Zanden

Abstract

On the basis of a newly constructed dataset, this paper presents long-term series of the price levels, nominal wages, and real wages in Spanish Latin America – more specifically in Mexico, Peru, Bolivia, Colombia, Chile, and Argentina – between ca. 1530 and ca. 1820. It synthesizes the work of scholars who have collected and published data on individual cities and periods, and presents comparable indices of real wages and prices in the colonial period that give a reasonable guide to trends in the long run. We show that wages and prices were on average much higher than in Western Europe or in Asia, a reflection of the low value of silver that must have had consequences for competitiveness of the Latin American economies. Labour scarcity was the second salient feature of Spanish Latin America and resulted in real wages much above subsistence and in some cases (Mexico, Bolivia, Argentina) comparable to levels in Northwestern Europe. For Mexico, this was caused by the dramatic decline of the population after the Conquest. For Bolivia, the driving force was the boom in silver mining in Potosi that created a huge demand for labour. In the case of Argentina, low population density was a pre-colonial feature. Perhaps due to a different pattern of depopulation, the real wages of other regions (Peru, Colombia, Chile) were much lower, and only increased above subsistence during the first half of the 18th century. These results are consistent with independent evidence on biological standards of living and with estimates of GDP per capita at the beginning of the 19th century.?

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Bibliographic Info

Paper provided by Utrecht University, Centre for Global Economic History in its series Working Papers with number 0020.

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Length: 49 pages
Date of creation: Dec 2011
Date of revision:
Handle: RePEc:ucg:wpaper:0020

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Postal: University of Utrecht, Drift 10, The Netherlands
Web page: http://www.cgeh.nl
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Keywords: Wages; Prices; Latin America; Early Modern Period;

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  1. Kaoru Sugihara, 2007. "The Second Noel Butlin Lecture: Labour-Intensive Industrialisation In Global History," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 47(2), pages 121-154, 07.
  2. Baten, Jöerg & Carson, Scott, 2010. "Latin American anthropometrics, past and present--An overview," Economics & Human Biology, Elsevier, vol. 8(2), pages 141-144, July.
  3. Allen, Robert C. & Bassino, Jean-Pascal & Ma, Debin & Moll-Murata, Christine & Zanden, Jan Luiten van, 2009. "Wages, prices, and living standards in China, 1738-1925: in comparison with Europe, Japan, and India," CEI Working Paper Series 2009-03, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
  4. Alan M. Taylor, 2000. "Peopling the Pampa: On the Impact of Mass Migration to the River Plate, 1870-1914," NBER Historical Working Papers 0068, National Bureau of Economic Research, Inc.
  5. van Zanden, Jan L., 1999. "Wages and the standard of living in Europe, 1500 1800," European Review of Economic History, Cambridge University Press, vol. 3(02), pages 175-197, August.
  6. Daron Acemoglu & Simon Johnson & James A. Robinson, 2000. "The Colonial Origins of Comparative Development: An Empirical Investigation," NBER Working Papers 7771, National Bureau of Economic Research, Inc.
  7. zmucur, S leyman & Pamuk, Sevket, 2002. "Real Wages And Standards Of Living In The Ottoman Empire, 1489 1914," The Journal of Economic History, Cambridge University Press, vol. 62(02), pages 293-321, June.
  8. 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.
  9. Salvucci, Richard J., 1990. "Essays on the Price History of Eighteenth-Century Latin America. Edited by Lyman L. Johnson and Enrique Tandeter. Albuquerque, NM: University of New Mexico Press, 1990. Pp. xiii, 419. $49.50. cloth: $," The Journal of Economic History, Cambridge University Press, vol. 50(04), pages 972-973, December.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. On the Explanations of How Latin America Fell Behind
    by bearodr in NEP-HIS blog on 2012-02-13 12:19:28
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Cited by:
  1. Robert Allen, 2013. "American Exceptionalism as a Problem in Global History," Economics Series Working Papers 689, University of Oxford, Department of Economics.

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