Evidence on the Standard of Living debate in Great Britain

from

“Conjectures and Contrivances: Economic Growth and the Standard of Living in Britain during the Industrial Revolution," an unpublished paper by Charles Feinstein,

All Souls College, Oxford University, 1977

Table 5. Indices of Average Full-time Nominal Earnings, the Cost of Living, and Real Earnings in Great Britain, 1770 to 1882 (Five--year averages, 1770 to 1772 = 100)

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Years	Nominal Earnings	Cost of Living	Real Earnings
1770 to 72	100	100	100
1773 to 77	103	109	95
1778 to 82	109	109	100
1783 to 87	109	107	101
1788 to 92	117	112	104
1793 to 97	140	133	105
1798 to 02	166	170	99
1803 to 07	187	167	111
1808 to 12	204	203	100
1813 to 17	200	191	105
1818 to 22	180	162	111
1823 to 27	171	151	113
1828 to 32	169	148	113
1833 to 37	171	138	123
1838 to 42	181	155	116
1843 to 47	185	150	123
1848 to 52	183	137	134
1853 to 57	208	165	126
1858 to 62	213	156	136
1863 to 67	228	160	142
1868 to 72	242	163	148
1873 to 77	271	162	167
1879 to 82	265	150	175

This estimate of the changes in the material aspect of living standards is thus markedly less optimistic

than the corresponding estimate by Lindert and Williamson, which showed a rise of some 75 per cent between

1781 and 1851 (Table 6). This discrepancy is almost entirely due to differences in the respective cost of living

indices, and to in particular to to the rate at which prices are estimated to have fallen from their war to time peak to 1850.

Table 6. Comparison with Lindert and Williamson Index, Real Earnings, 1781 to 1871 (1781 = 100)

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	Lindert and Williamson	Present Index
1781	100	100
1797	80	107
1805	103	112
1810	101	100
1815	105	105
1819	116	107
1827	131	113
1835	145	124
1851	174	135
1861	189	137
1871	210	153

This picture of a very slow improvement in the average real wage during the first half of the nineteenth century may be thought to conform rather better with qualitative accounts of conditions in both rural and urban areas in this period than the markedly more optimistic interpretation implied by the Lindert and Williamson series. ²¹ It is consistent with theoretical models of the behaviour of nominal earnings in an economy in which there was rapid population growth as well as the vast reservoir in rural Ireland, effectively creating an unlimited supply of labour in the countryside. ²² Given this excess supply of rural labour in conjunction with the other factors noted earlier to innovations in the hand to tools used for harvesting wheat and the post to war collapse of farm prices to agricultural earnings dropped steeply until the end of the 1820s and were subsequently unable to advance by more than a very modest amount.

The rural surplus in turn helped to keep down urban wages, and this pressure was exacerbated in many sectors as skilled male craftsmen were displaced or challenged by the introduction of machinery, by the employment of female workers in traditional male occupations such as the weaving of woolen cloth, and by changes in the organization of production, for example in the manufacture of clothing and footwear, which undermined the traditional position and organization of the skilled male journeymen. The very modest progress revealed by the present estimates is also consistent with other indicators of an abundant supply of unskilled labour; for instance, the ease and speed with which the huge number of navies was obtained to construct the railways in the 1840s (Mitchell, 1964, 322 to 3; Hawke, 1970, 327); or the fact that it was not the 1850s that the Army began to experience serious problems of recruitment and initiated a succession of measures to improve the infantryman's basic gross pay of 13d. per day which had prevailed since 1797 (Skelley, 1977).

It might also be suggested that the slow growth in average real earnings revealed by the present estimates makes more sense of the persistence of the standard of living controversy itself. The debate would surely not have been so protracted if the outcome had clearly been as unambiguously favourable to the workers as claimed by Lindert and Williamson. From this alternative perspective it can be seen that it was the unfortunate position of those sectors and regions which fell behind the modest improvement in the average which sustained the case of both contemporary and modern writers in arguing for a pessimistic interpretation. Farm labourers in the southern counties of England and Wales and certain of the former craftsmen and skilled journeymen were among those who experienced an actual deterioration in their material conditions in the first half of the nineteenth century. However, even if they escaped this fate, the new estimates suggest that most of those at work in the 1770s would have derived very little benefit from the industrial revolution during their lifetimes, and even those who started their working life after 1815 would typically have had to wait some four decades before seeing any significant improvement.

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21 See, for example, the discussion in Habakkuk (1962) pp. 132--88 and Pollard, (1978).

22 See, for example Lewis (1954). It should be noted, however, that Williamson (1985a) explicitly rejects the proposition

that the Lewis model is applicable to the British labour market in this period.