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Explaining UK wage inequality in the past globalisation period, 1880–1913

Author

Listed:
  • C. Betrán

    (Facultad de Economía, Universidad de Valencia, 46022 Valencia, Spain.)

  • J. Ferri

    (Facultad de Economía, Universidad de Valencia, 46022 Valencia, Spain.)

  • Maria A. Pons

    (Facultad de Economía, Universidad de Valencia, 46022 Valencia, Spain.)

Abstract

The current era of globalisation has witnessed a rising premium paid to skilled workers resulting in increasing wage inequality in most OECD countries. This pattern differs from that observed during the past globalisation period (1880–1913), in which wage inequality decreased in most of the Old World countries. The present debate over wage inequality focuses on the implications of globalisation, technological change, the role of labour market institutions and education. Similar factors were at work in the past globalisation process. In order to disentangle the main factors that contribute to wage inequality, we calibrate a general equilibrium model for the UK economy in the past globalisation period. The results show that a trade shock and a skilled-biased technology shock increased wage inequality. However, education and emigration had a more significant impact and led to a decrease in wage inequality.

Suggested Citation

  • C. Betrán & J. Ferri & Maria A. Pons, 2010. "Explaining UK wage inequality in the past globalisation period, 1880–1913," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 4(1), pages 19-50, January.
    • Handle: RePEc:afc:cliome:v:4:y:2010:i:1:p:19-50
    DOI: 10.1007/s11698-009-0038-z
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    Citations

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    Cited by:

    1. Timothy J. Hatton, 2010. "The Cliometrics Of International Migration: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 24(5), pages 941-969, December.
    2. Matteo Cervellati & Gerrit Meyerheim & Uwe Sunde, 2023. "The empirics of economic growth over time and across nations: a unified growth perspective," Journal of Economic Growth, Springer, vol. 28(2), pages 173-224, June.
    3. Garg, Shamita & Sushil,, 2021. "Determinants of deglobalization: A hierarchical model to explore their interrelations as a conduit to policy," Journal of Policy Modeling, Elsevier, vol. 43(2), pages 433-447.
    4. Timothy J. Hatton & Zachary Ward, 2024. "International Migration in the Atlantic Economy 1850–1940," Springer Books, in: Claude Diebolt & Michael Haupert (ed.), Handbook of Cliometrics, edition 3, pages 507-535, Springer.
    5. Giovanni Federico & Alessandro Nuvolari & Leonardo Ridolfi & Michelangelo Vasta, 2021. "The race between the snail and the tortoise: skill premium and early industrialization in Italy (1861–1913)," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 15(1), pages 1-42, January.

    More about this item

    Keywords

    Wage inequality; Globalisation; Technological change; General equilibrium;
    All these keywords.

    JEL classification:

    • N30 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - General, International, or Comparative
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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