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Skill Intensity and Rising Wage Dispersion in Nineteenth-Century American Manufacturing

Published online by Cambridge University Press:  29 March 2004

Professor of Economics and History, Vanderbilt University, and Research Associate, National Bureau of Economic Research.
Nicholas A. Beadles Professor of Economics, University of Georgia.
Professor of Economics and History, Vanderbilt University, and Research Associate, National Bureau of Economic Research.


We study the correlates of the monthly establishment wage—the average monthly wage at the establishment level—and changes in wage dispersion between plants using a model of manufacturing developed by Goldin and Katz and data from manuscript censuses of manufacturing. We find that wages were decreasing in establishment size, but increasing in capital intensity and use of steam power. We also find an increase in inequality in the establishment wage between 1850 and 1880. Most of the increase occurred below the median wage and can be attributed, in part, to the growing concentration of employment in large establishments.

© 2004 The Economic History Association

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