Sweet Diversity: Colonial Goods and the Rise of European Living Standards after 1492

Abstract

Did living standards stagnate before the Industrial Revolution? Traditional real-wage indices typically show broadly constant living standards before 1800. In this paper, we show that living standards rose substantially, but surreptitiously because of the growing availability of new goods. Colonial luxuries such as tea, coffee, and sugar transformed European diets after the discovery of America and the rounding of the Cape of Good Hope. These goods became household items in many countries by the end of the 18 th century. We use the Greenwood-Kopecky (2009) method to calculate welfare gains based on data about price changes and the rate of adoption of new colonial goods. Our results suggest that by 1850, the average Englishman would have been willing to forego 15% or more of his income in order to maintain access to sugar and tea alone. These findings are robust to a wide range of alternative assumptions, data series, and valuation methods. JEL: D12, D60, F10, N33

When did Britain industrialise? The sectoral distribution of the labour force and labour productivity in Britain, 1381–1851

“…Indeed, it is perhaps surprising that Clark should choose to put so much emphasis on this architectural indicator of prosperity, given the dramatic urbanisation and transformation of the built environment that had occurred by the end of the eighteenth century (de Vries, 1984), by which time British GDP per capita had risen to $2,000. This is just one of the many aspects of economic life which show a clear upward trend, including the growing diversity of diets (Feinstein, 1995;Woolgar et al, 2006), the availability of new and cheap consumer goods (Hersh and Voth, 2009), the growing wealth of testators (Overton et al, 2004;de Vries, 1994), the virtual elimination of famines (Campbell and Ó Gráda, 2011), the growth of publicly funded welfare provision (Slack, 1990), increasing literacy (Houstan, 1982;Schofield, 1973), and the growing diversity of occupations (Goose and Evans, 2000). The stagnation of daily real wage rates highlighted by Clark (2007;2012) is also quite consistent with the rising GDP per capita estimated by consumption goods increased (Angeles, 2008).…”

Why Did the Industrial Revolution Start in Britain?

“…Besides the construction of historical national accounts tracing the evolution of GDP per capita in Northwestern Europe and other regions of the world, a number of studies have also been produced to estimate preindustrial wages and thus check more precisely the hypothesis of "Little Divergence" of living standards across societies before the industrial revolution (see e.g. Allen, 2001Allen, , 2005aAllen, and 2009avan Zanden, 2005a;Broadberry and Bishnupriya, 2006;Clark, 2007b;Hersh and Voth, 2009;Pamuk and van Zanden 2010;Allen, Bassino et al, 2011;Allen, Murphy et al, 2012) (Goldstone, 2015). According to the early modernists, the "Great Divergence" between Europe and Asia would thus root in a "Little Divergence" occurring during the centuries preceding the industrial revolution (Broadberry, 2014).…”

“…2011,2015). Interestingly, Allen and Weisdorf (2011) Mui, 1988;Hoh-Chueng and Lorna, 1989;de Vries, 1993;Lemire, 1984Lemire, , 1992Lemire, , 1997Clifford, 1999, Berry, 2002;Stobart and Hann, 2004;Berg, 2004Berg, , 2005Reis, 2005;Vickery, 2006;Styles, 2006Styles, , 2007McCants, 2007;Hersh and Voth, 2009), have often been advanced in the literature to account for the British economic success after 1750 (see e.g. Habakkuk, 1962;Wrigley, 1967;de Vries, 1984de Vries, , 1994de Vries, , 2008Voigtlander and Voth, 2006;Allen, 2009bAllen, , 2010Brunt and Garcia-Penalosa, 2012;Abramson and Boix, 2014).…”

Measuring the Welfare Gain from Personal Computers: A Macroeconomic Approach

“…The European diet was essentially composed of beer, grains, meat, milk, and water. Hersh and Voth (2009) discuss how these new goods dramatically transformed European eating habits. After their introduction, the price of goods such as sugar and tea declined rapidly [see Hersh and Voth (2009, figures 2-4)].…”