This paper examines the five-dollar day compensation policy instituted by the Ford Motor Company in 1914 in light of recent developments in wage-determination theory. The new wage was above the opportunity cost of the labor employed. Yet various efficiency wage theories, by which high wages increase output, are shown to provide an implausible explanation. The particular (and epochal) technical change that occurred at Ford and the attitudes and beliefs of relevant actors suggest instead a rent-sharing theory driven by the threat of collective action by labor. This confluence, not the money, marks the episode as a watershed.

The Baring Crisis is the nineteenth century's most famous sovereign debt crisis. Using a database of more than 15,000 observations, we assess its effect on emerging market borrowers and find empirical evidence of a regional crisis but not a global crisis. During the crisis, Latin American yield spreads increased by more than 200 basis points relative to the rest of the world, even after controlling for macroeconomic, trade, political-institutional factors, and other country-specific effects. Our evidence suggests that European investors may have sold off or reduced their holdings of Latin American securities in the wake of the Baring Crisis.

The opening of the Suez Canal took place in a century crowded revolutionary changes in the shipping world. In sharp contrast to the slow pace of change and development in the preceding era, major changes occurred in almost every sector of the shipping industry in the nineteenth century. While many of the new departures can be explained, at least in part, by the application of the techniques of the Industrial Revolution to shipping, the opening of Suez went far to accelerate and give direction to these changes. The canal significantly altered shipbuilding techniques and practices and contributed to the precipitous decline in the importance of the sailing ship as a major world carrier. Suez helped to bring about die realignment and relative decline of the European entrepot trade. And the new channel led to significant shifts in the patterns of Eastern and Australasian trade.

Douglass North and Robert Thomas recently proposed a model of the rise and fall of the manorial system. There is much to be admired in this work, which explores an unusually broad historical vision with great analytical acumen; but my purpose here is to examine some of its less compelling features. In section II, I consider the nature of feudalism, and develop empirical arguments against the wholly voluntaristic and non-exploitative interpretation proposed by North and Thomas. Section III examines their analysis of the “classic” manor, which I believe errs both in limiting the feasible contracts to forms of direct barter and in attributing the lowest transaction costs to labor dues even within that restricted set. Section IV reviews the proposed explanation of the later evolution of the manorial system, disputing both the continued use of the transaction costs model and the extensions of it that consider custom as an institutional barrier to efficiency, and population growth and inflation as the exogenous motors of change. Section V provides a brief concluding summary and evaluation.

This article explores wealth accumulation among European immigrants who arrived in the United States between 1840 and 1850. It uses a new sample of immigrants linked from passenger-ship records to the 1850 and 1860 federal census manuscripts. These immigrants rapidly accumulated real and personal wealth. Their real wealth grew 10 percent with each year≈s residence in the United States. This was not because immigrants arriving in the early 1840s were wealthier at arrival than later arrivals, nor was the rapid accumulation of wealth confined to one nationality or occupation. Rather, it reflects these immigrants≈ abilities to adapt to new circumstances after their arrival.

We use a new trade dataset showing that nineteenth century sub-Saharan Africa experienced a terms of trade boom comparable to other parts of the “global periphery.” A sharp rise in export prices in the five decades before the scramble (1835–1885) was followed by an equally impressive decline during the colonial era. This study revises the view that the scramble for West Africa occurred when its major export markets were in decline and argues that the larger weight of West Africa in French imperial trade strengthened the rationale for French instead of British initiative in the conquest of the interior.

Any attempt to discuss the way in which railroads have promoted the rise of the American economy must assume some theory of economic evolution. The following analysis is based upon Schumpeter's theory of innovations. Briefly this theory holds that economic evolution in capitalistic society is started by innovation in some production function, that is, by new combinations of the factors in the economic process. These innovations may center in new commodities or new services, new types of machinery, new forms of organization, new firms, new resources, or new areas. As Schumpeter makes clear, this is not a general theory of economic, much less of social, change. Innovation is an internal factor operating within a given economic system while the system is also affected by external factors (many of them sociological) and by growth (which means, substantially, changes in population and in the sum total of savings made by individuals and firms). These sets of factors interact in economic change. “The changes in the economic process brought about by innovation, together with all their effects, and the response to them by the economic system” constitute economic evolution for Schumpeter.

This study estimates the size of the so-called “informal,” or unintermediated, credit market in one Swedish city through a period of economic transformation. In the early 1840s promissory notes accounted for more than half of the total credit market, and almost four times the value of credit channeled through the banking system. Even in the 1870s, the promissory-note market was twice the size of the loan volume of the banking system. By 1905 bank-based credit had finally surpassed the informal variety; but even then, outstanding promissory notes were almost three-fifths as great as total bank credits to noncorporate borrowers.

Since the triumph of a business culture a century and half ago the businessman has been scorned, and so the phrase “bourgeois virtue” sounds like an oxymoron. Economists since Bentham have believed that anyway virtue is beside the point: what matters for explanation is Prudence. But this is false in many circumstances, even strictly economic circumstances. An economic history that insists on Prudence Alone is misspecified, and will produce biased coefficients. And it will not face candidly the central task of economic history, an apology for or a criticism of a bourgeois society.

This study provides an empirical test of North and Weingast's theory of British capital-market development after the Glorious Revolution. The evidence is consistent with the hypotheses that institutional innovation in the 1690s led to the dramatic growth in London capital markets, and that threats to these institutions caused financial turmoil. We also find the economic motivation for these innovations to be consistent with the work of Ekelund and Tollison.

Carefully constructed but fallible historical estimates of GDP and agricultural output inform our understanding of the preindustrial origins of economic growth. Here we review four recent attempts at estimating agricultural output and food availability in England and Wales at different points between the Middle Ages and the Industrial Revolution. We highlight their contrasting implications for trends in well-being and nutritional status over time. Building on these estimates, we propose our own tentative, compromise estimate of food availability. The compromise estimates are more coherent with our understanding of conditions before and during the Industrial Revolution.

Various states in the Holy Roman Empire prepared for the Thirty Years' War by creating new mints and debasing the subsidiary coinage. The process spread through Gresham's Law: bad money was taken by debasing states to their neighbors and exchanged for good. The neighbor typically defended itself by debasing its own coin. The resulting hyperinflation was terminated early in the war by an agreement to return to the Imperial Augsburg Ordinance of 1559. The Kipper- und Wipperzeit, as the period is called, illuminates the geographic spread of financial crises, German hypennflations of this century, and current proposals for “free banking.”

The steel industry of Wilhelminian Germany is especially known for its tariff protection; its anti-competitive collusion, and the rapid increases of its productivity and its output. This study analyzes the interdependence of these four phenomena. The tariffs and cartels were directly symbiotic in providing protection, which had substantial redistributive effects in favor of larger firms. The restriction of competition by tariffs and cartels may have contributed to the productivity advances of the German steel industry by reducing the riskiness of capital-intensive technologies. Productivity increases made a major contribution to the industry's growth.

This article examines the determinants of emigration from post-Famine Ireland. As Irish real wages rose relative to those in destination countries, the emigration rate fell. We argue, from time series analysis, that much of the secular fall in the rate can be explained by that narrowing of the wage gap. County-level, cross-sectional analysis of emigration rates indicates that poverty and low wages, large family size, and limited opportunities to acquire smallholdings all contributed to high rates of emigration. Changes in those variables over time reflect the rise in living standards, consistent with time series evidence.

Women engaged primarily in the provision of domestic services for family members make important contributions to total output. This article provides estimates of the size and sectoral allocation of the nonmarket household work force in the United States between 1800 and 1860. Those estimates are then used as a basis for several alternative imputations of the value of these women's work, which modify the historical picture of economic growth over this period.

This article explores the operation of the international capital market between Amsterdam and London in the early eighteenth century and concludes that both markets were efficient and well integrated from 1723 on.

The gap between the mean wages of black men and white men in the United States narrowed substantially between 1940 and 1950. There was, however, almost no change in this wage gap between 1950 and 1960. Some of this discontinuity in the path of black progress can be explained by general changes in the wage structure—wage compression in the 1940s and slight expansion in the 1950s. However, most of the gains of the 1940s were driven by race-specific factors, including increasing relative wages controlling for worker characteristics. These race-specific gains ceased in the 1950s.

Manufacturing contributed almost all—83 percent—of the growth of total factor productivity in the U.S. private nonfarm economy between 1919 and 1929. During the depression manufacturing TFP growth was not as uniformly distributed, and only half as rapid, accounting for only 48 percent of PNE TFP growth. Yet the overall growth of the residual between 1929 and 1941 was the highest of any comparable period in the twentieth century. This resulted from the combination of a still potent manufacturing contribution with advances in transportation, public utilities, and distribution, fueled in part by investments in public infrastructure.

From 1930 to 1960 rural communities, mainly in the U.S. South and Southwest, gained access to electricity. In addition to lights, the benefits included easier clothes washing, refrigeration, and pumped water. This article uses differences in the timing of electricity access across rural counties to study the effects on infant mortality and fertility. Rural electrification led to substantial reductions in infant mortality but had little effect on women's fertility. The increase in electricity access between 1930 and 1960 can account for 15 to 19 percent of the decline in rural infant mortality during this period.