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We present a new theory and quantitative evidence on the incidence of unigeniture. Existing theories hypothesize some sort of indivisibility or increasing returns to scale in wealth to overcome the testator’s inclination toward equal sharing among heirs. Examining a micro-level data set of seventeenth-century English wills, we find that even after controlling for land and other presumed sources of increasing returns to scale and indivisibility, other variables such as financial wealth still correlate with the incidence of unigeniture. This leads us to propose a model where unigeniture is an efficient way to provide insurance against income shocks. An important implication of the theory is that observed unequal bequests are partially counteracted by ex post transfers. Therefore, inequality of bequests cannot be taken as evidence of inequality of consumption between heirs.

Inter-continental trade brought a novel form of organizing business to early modern Europe: the multinational firm. Headquartered in Europe and operating in Asia, the success of the East India Companies depended largely on the management of overseas outposts and their corresponding labor force. Using a dataset of 115 individuals hired in Europe to work in Asia, I present the internal structure of the careers and wages of civil servants in the Dutch East India Company in the eighteenth century. There were stable career paths, fast tracks in promotions, and sizable returns to tenure. Despite the 300-year-old evidence, the VOC conforms rather well with present personnel practices and theories of internal labor markets.

International audience; Scale economies and demand, combined with the relative prices of input factors, can provide an economic explanation to the location and timing of the Industrial Revolution. Its labor-saving innovations were profitable only above a minimum output threshold, which allowed to cover the upfront cost of capital. In turn, the possibility to exceed such threshold depended on consumer demand, which was affected by the level and by the distribution of real income. The case of the spinning jenny and the cotton industry in England and France serves as a valuable case study to show how scale and demand considerations might have mattered even at the eve of the Industrial Revolution, thus implying also a potentially important role for income distribution.

This paper reconstructs an annual volume series of GDP and GDP per capita for Sweden within present borders 1620–1800, extending the annual series that exist from 1800 onwards. Annual fluctuations of GDP are estimated from the annual fluctuations of harvests, which in the nineteenth century were strongly correlated with each other. Long-term trends are determined based on estimates of the values added of various activities for a few benchmark years. The paper shows that the long-term trend of GDP per capita increased modestly during the studied period, a different development from real wages that fell substantially. Henceforth, available data on real wages are at best a quite weak indicator of the development of GDP per capita. If Sweden is representative of Western Europe, the new data indicate a somewhat slower growth than assumed by Maddison. The increase in GDP per capita occurred in the seventeenth century and came entirely from non-agricultural activities, especially mining, public services, trade and transports. The lack of dynamism in the aggregate economy is explained by the dominance of agriculture. Per capita agricultural production displayed a stagnating tendency. Nevertheless, the expansion of the population in the eighteenth century was largely made possible by the increased use of iron tools in agriculture. Without technological progress, the strong population growth would probably have led to decreased per capita production.

The Portuguese and Dutch merchant empires had a similar geographic distribution with outposts all around the Indian Ocean, which they controlled and manned. Both empires faced the same problem of monitoring their agents in remote corners of the world. Each, however, arrived at a different solution to the monitoring problem. I use a principal–agent model to link different monitoring options to the different organizational structures of the two empires. I further investigate the implications of the model with archival data on labor compensation for Portuguese and Dutch workers overseas.

The German firm of Siemens and Halske introduced many enterprising features of what later came to be known as welfare capitalism in the mid-nineteenth century. Profit sharing, annual bonuses, a pension fund, a reduction in work hours, and an annual party were all means to ensure a productive, trouble-free workforce. We investigate the reasons why Siemens and Halske introduced this internal welfare system. We focus on the by-far most expensive part of the welfare system: the pension fund introduced in 1872, more than a decade before the nationwide social security system was implemented in Germany. We find that the adoption of the internal welfare system increased labor productivity, and in addition discouraged workers from striking. We estimate that the company’s gains due to strike prevention and higher productivity were at least as high as the cost of the pension fund. This suggests that (1) the introduction of a pension fund is not inconsistent with simple profit maximizing behavior on the firm’s side and (2) increased labor unionization induced firms to introduce subjective components of workers’ remuneration packages.

The share of children employed in English cotton factories fell significantly before the introduction of effective child labor legislation in the early 1830s. The early factories employed predominantly children because adults without factory experience were relatively unproductive factory workers. The subsequent growth of the cotton industry fostered the development of a labor market for productive adult factory workers. This effect helps account for the shift toward adults in the cotton factory workforce. JEL classification: J13, N33, O14