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Wage Convergence and Divergence in East Asia, 1900-39

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  • Myung Soo Cha

Abstract

This study calculates Robert Allen's "welfare ratio" for eleven cities in Japan, Korea, Manchuria, and Taiwan from 1900-39. Although considerable gap in prices and nominal wages existed, real wages remained roughly comparable in the 1910s in different cities of East Asia outside Manchuria, where unskilled workers enjoyed substantially higher living standards. Interwar decades saw real wage grow at different speeds in East Asian cities, causing both convergence, e.g. between Dairen and Tokyo, and divergence, e.g. between Beijing and Taipei. Workers in various cities of East Asia fared differently, primarily because productivity advanced at distinct speeds depending upon the amount of human capital available.

Suggested Citation

  • Myung Soo Cha, 2012. "Wage Convergence and Divergence in East Asia, 1900-39," Global COE Hi-Stat Discussion Paper Series gd12-253, Institute of Economic Research, Hitotsubashi University.
  • Handle: RePEc:hst:ghsdps:gd12-253
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    File URL: http://gcoe.ier.hit-u.ac.jp/research/discussion/2008/pdf/gd12-253.pdf
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    References listed on IDEAS

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    1. Gottschang, Thomas R, 1987. "Economic Change, Disasters, and Migration: The Historical Case of Manchuria," Economic Development and Cultural Change, University of Chicago Press, vol. 35(3), pages 461-490, April.
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    5. Robert Allen & Robert C. Allen, 2007. "Wages, Prices, and Living Standards in China, Japan, and Europe, 1738-1925," Economics Series Working Papers 316, University of Oxford, Department of Economics.
    6. Collins, William J., 1999. "Labor Mobility, Market Integration, and Wage Convergence in Late 19th Century India," Explorations in Economic History, Elsevier, vol. 36(3), pages 246-277, July.
    7. Eckstein, Alexander & Chao, Kang & Chang, John, 1974. "The Economic Development of Manchuria: The Rise of a Frontier Economy," The Journal of Economic History, Cambridge University Press, vol. 34(1), pages 239-264, March.
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    More about this item

    Keywords

    price; wage; living standards; skill premium; ethnic wage gap;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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