This study builds the first internationally comparable index of real wages for Mexico City bridging the 18 th and the early 20 th century. Real wages started out in relatively high international levels in the mid 18 th century, but declined from the late 1770s on, with some partial and temporal rebounds after the 1810s. After the 1860s, real wages recovered and eventually reached 18 th -century levels in the early 20 th century. Real wages of Mexico City's workers subsequently fell behind those of high-wage economies to converge with the lower fringes of middle-wage economies. The age of the global Great Divergence was Mexico's own age of stagnation and decline relative to the world economy.

Historical wage and income data provide both normative measures of living standards, and indicators of patterns of economic development. This study shows that, given limited historical data, median incomes are most appropriate for measuring welfare and inequality, while urban unskilled wages can be used to test dualist models of development. We present new estimates of these series for Mexico from 1800 to 2015 and find that both have historically failed to keep up with aggregate growth: GDP per worker is now over eight times higher than in the nineteenth century, while unskilled urban real wages are only 2.2 times higher, and national median incomes only 2.0 times higher. From the perspective of inequality and social welfare, our findings confirm that there is no automatic positive relationship between economic growth and rising living standards for the majority. From the perspective of development, we argue that these findings are explained by a dual economy model incorporating Lewis's assumption of a reserve army of labour, and we explain why the decline in inequality predicted by Kuznets has not occurred.

We examine the evolution of adult female heights in twelve Latin American countries during the second half of the twentieth century based on demographic health surveys and related surveys compiled from national and international organizations. Only countries with more than one survey were included, allowing us to cross-examine surveys and correct for biases. We first show that average height varies significantly according to location, from 148.3cm in Guatemala to 158.8cm in Haiti. The evolution of heights over these decades behaves like indicators of human development, showing a steady increase of 2.6cm from the 1950s to the 1990s. Such gains compare favorably to other developing regions of the world, but not so much with recently developed countries. Height gains were not evenly distributed in the region, however. Countries that achieved higher levels of income, such as Brazil, Chile, Colombia and Mexico, gained on average 0.9cm per decade, while countries with shrinking economies, such as Haiti and Guatemala, only gained 0.25cm per decade.

Historical wage and incomes data are informative both as normative measures of living standards, and as indicators of patterns of economic development. We show that, given limited historical data, median incomes are most appropriate for measuring welfare and inequality, while urban unskilled wages can be used to test dualist models of development. We present a new dataset including both series in Mexico from 1800 to 2015 and find that both have historically failed to keep up with aggregate growth: per worker GDP is now over eight times higher than in the nineteenth century, while unskilled urban real wages are only 2.2 times higher, and median incomes only 2.0 times. From the perspective of inequality and social welfare, our findings confirm that there is no automatic positive relationship between economic growth and rising living standards for the majority. From the perspective of development, we argue that these findings are consistent with a dual economy model incorporating Lewis’s assumption of a reserve army of labour, and explain why Kuznets’s predicted decline in inequality has not occurred. (Stone Center on Socio-Economic Inequality Working Paper)

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