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Labour market adjustment to economic downturns in the Catalan textile industry, 1880-1910: did employers breach implicit contracts?

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  • Domenech, Jordi

Abstract

This paper studies the way workers and firms behaved in a highly cyclical sector such as the cotton textile industry, which encompassed 1/5 of the Catalan industrial workforce in the early 20th century. Using firm level evidence from the late 19th and early 20th centuries, the paper shows that, in spite of weak unionisation and the lack of regional or local collective bargaining institutions, piece rates in cotton spinning and weaving were not subject to competitive rate cuts and remained fixed over the cycle. When facing a negative demand shock, firms adjusted by reducing output, hours of work, labour productivity and employment. I argue that in the Catalan case the stability of piece rate lists depended on a highly flexible labour market for female workers, limiting the pressure of unemployed workers on prevailing wages.

Suggested Citation

  • Domenech, Jordi, 2005. "Labour market adjustment to economic downturns in the Catalan textile industry, 1880-1910: did employers breach implicit contracts?," Economic History Working Papers 22333, London School of Economics and Political Science, Department of Economic History.
    • Handle: RePEc:ehl:wpaper:22333
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • N0 - Economic History - - General
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925

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