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The price of human capital in a pre-industrial economy: Premiums and apprenticeship contracts in 18th century England

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  • Minns, Chris
  • Wallis, Patrick

Abstract

Training through apprenticeship provided the main mechanism for occupational human capital formation in pre-industrial England. This paper demonstrates how training premiums (fees) complemented the formal legal framework surrounding apprenticeship to secure training contracts. Premiums varied in response to scarcity rents, the expected productivity of masters and apprentices, and served as compensation for the anticipated risk of default. In most trades premiums were small enough to allow access to apprenticeship training for youths from modest families.

Suggested Citation

  • Minns, Chris & Wallis, Patrick, 2013. "The price of human capital in a pre-industrial economy: Premiums and apprenticeship contracts in 18th century England," Explorations in Economic History, Elsevier, vol. 50(3), pages 335-350.
    • Handle: RePEc:eee:exehis:v:50:y:2013:i:3:p:335-350
    DOI: 10.1016/j.eeh.2013.02.001
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    References listed on IDEAS

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    2. David de la Croix & Matthias Doepke & Joel Mokyr, 2018. "Clans, Guilds, and Markets: Apprenticeship Institutions and Growth in the Preindustrial Economy," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 133(1), pages 1-70.
    3. Bernard, Seth, 2024. "The premium for skilled labor in the Roman world," Explorations in Economic History, Elsevier, vol. 91(C).
    4. Rao, Neel, 2015. "General training in labor markets: Common value auctions with unobservable investment," Journal of Economic Behavior & Organization, Elsevier, vol. 120(C), pages 19-45.
    5. B. Zorina Khan, 2018. "Human capital, knowledge and economic development: evidence from the British Industrial Revolution, 1750–1930," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 12(2), pages 313-341, May.
    6. Wallis, Patrick & Colson, Justin & Chilosi, David, 2016. "Puncturing the Malthus delusion: structural change in the British economy before the industrial revolution, 1500-1800," Economic History Working Papers 66816, London School of Economics and Political Science, Department of Economic History.
    7. Moshe Justman & Karine Beek, 2015. "Market forces shaping human capital in eighteenth-century London," Economic History Review, Economic History Society, vol. 68(4), pages 1177-1202, November.
    8. Feldman, Naomi E. & van der Beek, Karine, 2016. "Skill choice and skill complementarity in eighteenth century England," Explorations in Economic History, Elsevier, vol. 59(C), pages 94-113.
    9. Marc Klemp & Jacob Weisdorf, 2019. "Fecundity, Fertility and The Formation of Human Capital," The Economic Journal, Royal Economic Society, vol. 129(618), pages 925-960.
    10. Hoogenboom, Marcel & Kissane, Christopher & Prak, Maarten & Wallis, Patrick & Minns, Chris, 2018. "Guilds in the transition to modernity: the cases of Germany, United Kingdom, and the Netherlands," LSE Research Online Documents on Economics 87476, London School of Economics and Political Science, LSE Library.
    11. Claude Diebolt & Roger Fouquet & Ralph Hippe, 2020. "Cliometrics and the Evolution of Human Capital," Post-Print hal-02920429, HAL.
    12. Frankema, Ewout & van Waijenburg, Marlous, 2019. "The Great Convergence. Skill Accumulation and Mass Education in Africa and Asia, 1870-2010," CEPR Discussion Papers 14150, C.E.P.R. Discussion Papers.
    13. Morgan Kelly & Cormac O Grada, 2014. "Ready for Revolution? The English Economy before 1800," CAGE Online Working Paper Series 209, Competitive Advantage in the Global Economy (CAGE).
    14. Rota, Mauro & Spinesi, Luca, 2024. "Economic growth before the Industrial Revolution: Rural production and guilds in the European Little Divergence," Economic Modelling, Elsevier, vol. 130(C).
    15. Ruben Schalk, 2016. "Apprenticeships and craft guilds in the Netherlands, 1600–1900," Working Papers 0080, Utrecht University, Centre for Global Economic History.
    16. Cormac Ó Gráda, 2018. "Notes on Guilds on the Eve of the French Revoloution," Working Papers 201804, School of Economics, University College Dublin.

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    More about this item

    Keywords

    Apprenticeship; Training; 18th century England;
    All these keywords.

    JEL classification:

    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • N33 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: Pre-1913
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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