IDEAS home Printed from https://ideas.repec.org/p/ehl/wpaper/22314.html

Structural change and the growth contribution of services: how motion pictures industrialized US spectator entertainment

Author

Listed:
  • Bakker, Gerben

Abstract

This paper examines the effect of a new technology on a labour-intensive service. Comparing primal and dual TFP-growth with final-year social savings, we find that, between 1900 and 1938, motion pictures increased entertainment output (measured in spectator-hours) by at least nine percent annually, mainly through intensive growth. Falling profit margins indicate that motion pictures increased competition, while real wages rising twice the national average suggests labour captured part of the efficiency gains. Surviving live entertainment experienced some intensive growth, reached a similar capital/labour ratio but paid lower wages. These findings suggest that some services can experience similar productivity gains as manufacturing and that traditional service-activities survive the onslaught of new technologies by transforming their production structure.

Suggested Citation

  • Bakker, Gerben, 2007. "Structural change and the growth contribution of services: how motion pictures industrialized US spectator entertainment," Economic History Working Papers 22314, London School of Economics and Political Science, Department of Economic History.
    • Handle: RePEc:ehl:wpaper:22314
    as

    Download full text from publisher

    File URL: https://researchonline.lse.ac.uk/id/eprint/22314/
    File Function: Open access version.
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Millward, Robert, 1990. "Productivity in the UK Services Sector: Historical Trends 1856-1985 and Comparisons with the USA 1950-85," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(4), pages 423-436, Special I.
    2. Motta,Massimo, 2004. "Competition Policy," Cambridge Books, Cambridge University Press, number 9780521016919, January.
    3. Antras, Pol & Voth, Hans-Joachim, 2003. "Factor prices and productivity growth during the British industrial revolution," Explorations in Economic History, Elsevier, vol. 40(1), pages 52-77, January.
    4. Becker, Gary S, 1993. "Nobel Lecture: The Economic Way of Looking at Behavior," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 385-409, June.
    5. John W. Kendrick, 1961. "Productivity Trends in the United States," NBER Books, National Bureau of Economic Research, Inc, number kend61-1, September.
    6. Sue Bowden & Avner Offer, 1994. "Household appliances and the use of time: the United States and Britain since the 1920s," Economic History Review, Economic History Society, vol. 47(4), pages 725-748, November.
    7. Broadberry, Stephen & Ghosal, Sayantan, 2002. "From the Counting House to the Modern Office: Explaining Anglo-American Productivity Differences in Services, 1870–1990," The Journal of Economic History, Cambridge University Press, vol. 62(4), pages 967-998, December.
    8. repec:ehl:wpaper:22350 is not listed on IDEAS
    9. repec:ehl:wpaper:22366 is not listed on IDEAS
    10. Bakker,Gerben, 2011. "Entertainment Industrialised," Cambridge Books, Cambridge University Press, number 9781107403499, January.
    11. Alexander J. Field, 2003. "The Most Technologically Progressive Decade of the Century," American Economic Review, American Economic Association, vol. 93(4), pages 1399-1413, September.
    12. White, Lawrence J, 1987. "Antitrust and Merger Policy: A Review and Critique," Journal of Economic Perspectives, American Economic Association, vol. 1(2), pages 13-22, Fall.
    13. Chris Freeman & Luc Soete, 1997. "The Economics of Industrial Innovation, 3rd Edition," MIT Press Books, The MIT Press, edition 3, volume 1, number 0262061953, December.
    14. Foreman-Peck,James (ed.), 1991. "New Perspectives on the Late Victorian Economy," Cambridge Books, Cambridge University Press, number 9780521391078, January.
    15. repec:ehl:wpaper:22348 is not listed on IDEAS
    16. Broadberry,Steve N., 2005. "The Productivity Race," Cambridge Books, Cambridge University Press, number 9780521023580, January.
    17. Abramovitz, Moses, 1993. "The Search for the Sources of Growth: Areas of Ignorance, Old and New," The Journal of Economic History, Cambridge University Press, vol. 53(2), pages 217-243, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gerben Bakker, 2011. "Leisure Time, Cinema and the Structure of Household Entertainment Expenditure, 1890–1940," Chapters, in: Samuel Cameron (ed.), Handbook on the Economics of Leisure, chapter 16, Edward Elgar Publishing.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:ehl:wpaper:27866 is not listed on IDEAS
    2. Bakker, Gerben, 2007. "Structural change and the growth contribution of services: how motion pictures industrialized US spectator entertainment," LSE Research Online Documents on Economics 22314, London School of Economics and Political Science, LSE Library.
    3. repec:ehl:wpaper:22348 is not listed on IDEAS
    4. Bakker, Gerben, 2009. "Time and productivity growth in services: how motion pictures industrialized entertainment," LSE Research Online Documents on Economics 27866, London School of Economics and Political Science, LSE Library.
    5. Gerben Bakker & Nicholas Crafts & Pieter Woltjer, 2019. "The Sources of Growth in a Technologically Progressive Economy: The United States, 1899–1941," The Economic Journal, Royal Economic Society, vol. 129(622), pages 2267-2294.
    6. Field, Alexander J., 2009. "US economic growth in the gilded age," Journal of Macroeconomics, Elsevier, vol. 31(1), pages 173-190, March.
    7. repec:ehl:wpaper:22350 is not listed on IDEAS
    8. Nicholas Crafts & Pieter Woltjer, 2021. "Growth Accounting In Economic History: Findings, Lessons And New Directions," Journal of Economic Surveys, Wiley Blackwell, vol. 35(3), pages 670-696, July.
    9. Martha J. Bailey & William J. Collins, 2011. "Did Improvements in Household Technology Cause the Baby Boom? Evidence from Electrification, Appliance Diffusion, and the Amish," American Economic Journal: Macroeconomics, American Economic Association, vol. 3(2), pages 189-217, April.
    10. Leandro Prados de la Escosura & Tamás Vonyó & Ilya B. Voskoboynikov, 2021. "Accounting For Growth In History," Journal of Economic Surveys, Wiley Blackwell, vol. 35(3), pages 655-669, July.
    11. Harald Edquist & Magnus Henrekson, 2006. "Technological Breakthroughs and Productivity Growth," Research in Economic History, in: Research in Economic History, pages 1-53, Emerald Group Publishing Limited.
    12. Broadberry, Stephen & Ghosal, Sayantan, 2005. "Technology, organisation and productivity performance in services: lessons from Britain and the United States since 1870," Structural Change and Economic Dynamics, Elsevier, vol. 16(4), pages 437-466, December.
    13. repec:dgr:rugggd:gd-108 is not listed on IDEAS
    14. Herman De Jong & Pieter Woltjer, 2011. "Depression dynamics: a new estimate of the Anglo‐American manufacturing productivity gap in the interwar period," Economic History Review, Economic History Society, vol. 64(2), pages 472-492, May.
    15. Jong, H. de & Woltjer, P., 2009. "A Comparison of Real Output and Productivity for British and American Manufacturing in 1935," GGDC Research Memorandum GD-108, Groningen Growth and Development Centre, University of Groningen.
    16. Peter Scott, 2009. "Mr Drage, Mr Everyman, and the creation of a mass market for domestic furniture in interwar Britain1," Economic History Review, Economic History Society, vol. 62(4), pages 802-827, November.
    17. Prados de la Escosura, Leandro & Rosés, Joan R., 2008. "Proximate causes of economic growth in Spain, 1850-2000," IFCS - Working Papers in Economic History.WH wp08-12, Universidad Carlos III de Madrid. Instituto Figuerola.
    18. Michael D. Bordo & David C. Wheelock, 2004. "Monetary policy and asset prices: a look back at past U.S. stock market booms," Review, Federal Reserve Bank of St. Louis, vol. 86(Nov), pages 19-44.
    19. Hugh Rockoff, 2008. "Great Fortunes of the Gilded Age," NBER Working Papers 14555, National Bureau of Economic Research, Inc.
    20. Eichengreen, Barry, 2017. "A two-handed approach to secular stagnation: Some thoughts based on 1930s experience," Journal of Policy Modeling, Elsevier, vol. 39(4), pages 650-654.
    21. Giovanni Dosi & Richard Nelson, 2013. "The Evolution of Technologies: An Assessment of the State-of-the-Art," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 3(1), pages 3-46, June.
    22. Jean-Pierre Dormois, 2006. "Tracking the elusive French productivity lag in industry 1840-1973," Hi-Stat Discussion Paper Series d05-152, Institute of Economic Research, Hitotsubashi University.
    23. Ramey, Valerie A., 2020. "Secular stagnation or technological lull?," Journal of Policy Modeling, Elsevier, vol. 42(4), pages 767-777.
    24. Hansen, G.D. & Ohanian, L.E., 2016. "Neoclassical Models in Macroeconomics," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 2043-2130, Elsevier.

    More about this item

    JEL classification:

    • N0 - Economic History - - General
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ehl:wpaper:22314. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: LSERO Manager on behalf of EH Dept. (email available below). General contact details of provider: https://edirc.repec.org/data/chlseuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.