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Happy in the service of the Company: the purchasing power of VOC salaries at the Cape in the 18th century

Author

Listed:
  • Sophia du Plessis

    (Department of Economics, University of Stellenbosch)

  • Stan du Plessis

    (Department of Economics, University of Stellenbosch)

Abstract

This paper contributes to the debate on the level and trajectory of welfare at the Cape of Good Hope during the 18th century. Recent scholarship (for example, Allen 2005) has calculated and compared the levels and evolution of real wages in various European and Asian economies since the early modern period. To this lit-erature we add evidence for unskilled and skilled workers of the Dutch East India Company at the Cape of Good Hope during the 18th century, following De Zwart (2009; 2011), who recently presented evidence for unskilled workers in the Cape for the latter half of the 17th century and the 18th century. We calculate job-specific real wages in a three-step argument; from the narrowest international comparison of wage rates in terms of silver content to one based on a basket of widely consumed goods. The paper’s contributions lie in the breadth of the com-parisons, the inclusion of skilled workers in the comparison and the adaptation of the consumption basket to local conditions and relative prices at the Cape. The results support the hypothesis that at the start of the 18th century, the Cape Col-ony was relatively poor on an international comparison, but as the century un-folded, gained considerably on even the richest contemporary societies.

Suggested Citation

  • Sophia du Plessis & Stan du Plessis, 2012. "Happy in the service of the Company: the purchasing power of VOC salaries at the Cape in the 18th century," Working Papers 01/2012, Stellenbosch University, Department of Economics.
  • Handle: RePEc:sza:wpaper:wpapers153
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    References listed on IDEAS

    as
    1. Robert C. Allen & Jean-Pascal Bassino & Debin Ma & Christine Moll-Murata & Jan Luiten Van Zanden, 2011. "Wages, prices, and living standards in China, 1738–1925: in comparison with Europe, Japan, and India," Economic History Review, Economic History Society, vol. 64, pages 8-38, February.
    2. 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.
    3. Stephen Broadberry & Bishnupriya Gupta, 2006. "The early modern great divergence: wages, prices and economic development in Europe and Asia, 1500–1800," Economic History Review, Economic History Society, vol. 59(1), pages 2-31, February.
    4. 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.
    5. Pim de Zwart, 2011. "Real wages at the Cape of Good Hope: A long-term perspective, 1652-1912," Working Papers 0013, Utrecht University, Centre for Global Economic History.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Lessons from the Cape Colony
      by Johan Fourie in Johan Fourie's Blog on 2012-03-15 15:30:02
    2. Lessons from the Cape Colony
      by Johan Fourie in Johan Fourie's Blog on 2012-03-15 15:30:02

    Citations

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    Cited by:

    1. Johan Fourie, 2018. "Cliometrics in South Africa," Working Papers 14/2018, Stellenbosch University, Department of Economics.
    2. Johan Fourie & Jan Luiten Zanden, 2013. "GDP in the Dutch Cape Colony: The National Accounts of a Slave-Based Society," South African Journal of Economics, Economic Society of South Africa, vol. 81(4), pages 467-490, December.
    3. Johan Fourie & Dieter von Fintel, 2010. "A History With Evidence: Income inequality in the Dutch Cape Colony," Working Papers 184, Economic Research Southern Africa.
    4. Pim de Zwart, 2011. "Real wages at the Cape of Good Hope: A long-term perspective, 1652-1912," Working Papers 0013, Utrecht University, Centre for Global Economic History.
    5. Sophia du Plessis & Ada Jansen & Dieter von Fintel, 2014. "Slave prices and productivity at the Cape of Good Hope from 1700 to 1725: did all settler farmers profit from the trade?," Working Papers 17/2014, Stellenbosch University, Department of Economics, revised 2014.
    6. Jerven, Morten & Austin, Gareth & Green, Erik & Uche, Chibuike & Frankema, Ewout & Fourie, Johan & Inikori, Joseph & Moradi, Alexander & Hillbom, Ellen, 2012. "Moving Forward in African Economic History. Bridging the Gap Between Methods and Sources," Lund Papers in Economic History 124, Lund University, Department of Economic History.
    7. Bokang Mpeta & Johan Fourie & Kris Inwood, 2017. "Black living standards in South Africa before democracy: New evidence from heights," Working Papers 670, Economic Research Southern Africa.
    8. Willem H. Boshoff & Johan Fourie, 2015. "When did globalization begin in South Africa?," Working Papers 10/2015, Stellenbosch University, Department of Economics.
    9. Martins, Igor, 2019. "An Act for the Abolition of the Slave Trade: The Effects of an Import Ban on Cape Colony Slaveholders," African Economic History Working Paper 43/2019, African Economic History Network.
    10. Piraino, Patrizio & Muller, Sean & Cilliers, Jeanne & Fourie, Johan, 2013. "The transmission of longevity across generations: The case of the settler Cape Colony," SALDRU Working Papers 113, Southern Africa Labour and Development Research Unit, University of Cape Town.
    11. Johan Fourie & Nonso Obikili, 2019. "Decolonizing with data: The cliometric turn in African economic history," Working Papers 02/2019, Stellenbosch University, Department of Economics.

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    More about this item

    Keywords

    Real wages; Dutch East India Company (VOC); Cape Colony; Compari-sons of living standards; Economic history of South Africa; Economic history of the Cape Colony;
    All these keywords.

    JEL classification:

    • N37 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Africa; Oceania
    • N97 - Economic History - - Regional and Urban History - - - Africa; Oceania
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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