Market Forces Shaping Human Capital in Eighteenth Century London
Moshe Justman and
Karine van der Beek ()
Melbourne Institute Working Paper Series from Melbourne Institute of Applied Economic and Social Research, The University of Melbourne
We draw on quantitative and descriptive data from Robert Campbell’s widely cited manual for prospective apprentices, The London Tradesman (1747), to demonstrate the responsiveness of apprenticeship in mid-eighteenth century London to market forces of supply and demand. We regress apprenticeship premiums on journeymen’s wages, set-up costs, and a selection of employment conditions and requirements across 178 trades, and find a significant elasticity of 0.4 with respect to wages and 0.25 with respect to set-up costs. We interpret this as supporting an economic model that views premiums as bounded from above by the expected benefits of acquiring the skills of the trade (Lane, 1996); bounded from below by the expected net training costs to the master, taking into account the possibility of the apprentice terminating his service prematurely (Wallis, 2008); and reflecting the relative bargaining power of master and parent. This supports the thesis that apprenticeship played an important role in adapting the English workforce to the skill requirements of the Industrial Revolution. Moreover, by demonstrating the internal and external consistency of Campbell’s observations, our findings support their further use as a unique, invaluable source of detailed, trade-specific wage data from the early years of the Industrial Revolution.
Keywords: Apprenticeship; Industrial Revolution; tradesmen’s wages; London; eighteenth century; Robert Campbell (search for similar items in EconPapers)
JEL-codes: N33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-his and nep-hrm
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Journal Article: Market forces shaping human capital in eighteenth-century London (2015)
Working Paper: MARKET FORCES SHAPING HUMAN CAPITAL IN EIGHTEENTH CENTURY LONDON (2013)
Working Paper: Market Forces Shaping Human Capital in Eighteenth Century London (2013)
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