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Labor Productivity in Britain and America During the Nineteenth Century

  • Stephen N. Broadberry
  • Douglas A. Irwin

A number of writers have recently questioned whether labor productivity or per capita incomes were ever higher in the United Kingdom than in the United States. We show that although the United States already had a substantial labor productivity lead in industry as early as 1840, especially in manufacturing, labor productivity was broadly equal in the two countries in agriculture, while the United Kingdom was ahead in services. Hence aggregate labor productivity was higher in the United Kingdom, particularly since the United States had a larger share of the labor force in low value-added agriculture. U.S. overtaking occurred decisively only during the 1890s, as labor productivity pulled ahead in services and the share of agricultural employment declined substantially. Labor force participation was lower in the United States, so that the United Kingdom's labor productivity advantage in the mid-nineteenth century translated into a larger per capita income lead.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10364.

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Date of creation: Mar 2004
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Publication status: published as Broadberry, Stephen D. and Douglas A. Irwin. "Labor Productivity In The United States And The United Kingdom During The Nineteenth Century," Explorations in Economic History, 2006, v43(2,Apr), 257-279.
Handle: RePEc:nbr:nberwo:10364
Note: DAE ITI
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