Unreal Wages? A New Empirical Foundation for the Study of Living Standards and Economic Growth in England, 1260-1860

The Institute of Economics will hold the next meeting of its Seminar Series on Tuesday, March 21, 2017: Jacob Louis Weisdorf, from the University of Southern Denmark, will present the paper Unreal Wages? A New Empirical Foundation for the Study of Living Standards and Economic Growth in England, 1260-1860 .

Abstract:

Existing measures of historical real wages suffer from the fundamental problem that workers’ annual incomes are estimated on the basis of day wages without knowing the length of the working year. We circumvent this problem by presenting a novel wage series for male workers employed on annual contracts. We use evidence of labour market arbitrage to argue that existing estimates of annual incomes are badly off target, because they overestimate the medieval working year but underestimate the industrial one. Our data suggests that modern economic growth began two centuries earlier than hitherto thought and was driven by an ‘Industrious Revolution’.