Changing Returns to Scale in Manufacturing 1880-1930: The Rise of (Skilled) Labor?

Jeanne Lafortune, Ethan Lewis, José Pablo Martínez and José Tessada

No 28633, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper estimates returns to scale for manufacturing industries around the turn of the twentieth century in the United States by exploiting an industry-city panel data for the years 1880-1930. We estimate decreasing returns to scale on average over the period, contrary to most of the existing literature, because our empirical methodology allows us to separate returns to scale from "agglomeration" effects. We also find that returns to scale grew substantially after 1910, mostly because the return to labor grew. We find that this was more marked in industries that were more intensive in human capital and energy at the beginning of the period and in cells that were less competitive. Overall, results suggest that technological change and lack of initial competition played relevant roles in the rise of larger establishments in manufacturing.

JEL-codes: J23 N61 N62 R12 (search for similar items in EconPapers)
Date: 2021-04
New Economics Papers: this item is included in nep-eff, nep-his, nep-lma and nep-ure
Note: DAE LS
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.nber.org/papers/w28633.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:28633

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w28633

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().