Factor price convergence in the late nineteenth century

Kevin O'Rourke, Alan M. Taylor, Jeffrey G. Williamson

Research output: Contribution to journalArticle

Abstract

We examine a dramatic historical episode of factor price convergence in the late nineteenth century. Our focus is convergence between Old World and New, and the analysis centers on land and labor. Wage-rental ratios boomed in the Old World and collapsed in the New, moving the resource-rich, labor-scarce New World closer to the resource-scarce, labor-abundant Old World. We use econometrics and simulations to identify pro-convergence forces which include commodity price convergence, factor accumulation, and factor-saving biases. The results confirm that open-economy characteristics and international market integration are important sources of convergence.

Original languageEnglish (US)
Pages (from-to)499-530
Number of pages32
JournalInternational Economic Review
Volume37
Issue number3
DOIs
StatePublished - Jan 1 1996

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Price convergence
Labor
Factor prices
Resources
Factors
International markets
Wages
Market integration
Commodity prices
Simulation
Econometrics
Open economy

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

O'Rourke, K., Taylor, A. M., & Williamson, J. G. (1996). Factor price convergence in the late nineteenth century. International Economic Review, 37(3), 499-530. https://doi.org/10.2307/2527439

Factor price convergence in the late nineteenth century. / O'Rourke, Kevin; Taylor, Alan M.; Williamson, Jeffrey G.

In: International Economic Review, Vol. 37, No. 3, 01.01.1996, p. 499-530.

Research output: Contribution to journalArticle

O'Rourke, K, Taylor, AM & Williamson, JG 1996, 'Factor price convergence in the late nineteenth century', International Economic Review, vol. 37, no. 3, pp. 499-530. https://doi.org/10.2307/2527439
O'Rourke, Kevin ; Taylor, Alan M. ; Williamson, Jeffrey G. / Factor price convergence in the late nineteenth century. In: International Economic Review. 1996 ; Vol. 37, No. 3. pp. 499-530.
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