This study uses price information relating to 12 towns and wage information from 18 towns to develop a real wage index for unskilled urban labourers in Germany during the three-and-a-half centuries preceding the onset of rapid industrialization.Combining the new series with information from other parts of Europe establishes two stages of real wage divergence during the seventeenth to nineteenth century. The first occurred in the middle of the seventeenth century when real wages in centres of trade and finance located on the rim of the North Sea rose far above the level prevailing in their hinterland. The second stage unfolded from the second quarter of the eighteenth century when the real wage in south England, northern and central Italy, and Germany began to diverge; Germany followed a middle path between the other two countries. The second commercial revolution, which improved business techniques and promoted Smithian growth, goes a long way towards accounting for this development.

The study documents fluctuations of proto-industrial income, of occupation, debt and presence on land markets across the life course for rural households in a major proto-industrial region during the seventeenth and eighteenth centuries. These fluctuations are interpreted on the basis that a major objective of households is to equalize their income across different stages of their development. The permanent income hypothesis is then extended to take into account land purchases and debt-contracting that result from the need to adjust land and capital to fluctuations in the size of the family labour force across the family cycle and from endeavours to improve the family's welfare by increasing the labour to land ratio. The empirical material presented shows marked fluctuations of income from proto-industrial work across the life course and suggests the existence of permanent income-cum-accumulation strategies to cope with these fluctuations.

Working papers of the Max Planck Institute for Demographic Research receive only limited review. Views or opinions expressed in working papers are attributable to the authors and do not necessarily refl ect those of the Institute.

No abstract

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.. Wiley and The International Studies Association are collaborating with JSTOR to digitize, preserve and extend access to International Studies Quarterly.