American Incomes 1774-1860

Abstract

Building what we call social tables, this paper quantifies the level and inequality of American incomes from 1774 to 1860. In 1774 the American colonies had average incomes exceeding those of the Mother Country, even when slave households are included in the aggregate. Between 1774 and 1790, this income advantage over Britain was lost, due to the severe dislocation caused by the fight for Independence. Then between 1790 and 1860 US income per capita grew even faster than previous scholars have estimated. We also find that the South was initially much richer than the North on the eve of Revolution, but then suffered a severe reversal of fortune, so that by 1840 its white population was already poorer than free Northerners. In terms of inequality, our estimates suggest that American colonists had much more equal incomes than did households in England and Wales around 1774. Indeed, New England and the Middle Colonies appear to have been more egalitarian than anywhere else in the measureable world. Income inequality rose dramatically between 1774 and 1860, especially in the South.

The effects of family and location on wealth: A longitudinal study of the US North, 1850–1870

“…It is difficult to find records that link the two, but Kearl and Pope (1986b) used census data and tax lists to study this in Utah. While inequality was less than in Europe early on, Lindert and Williamson (2012), using estimates of incomes based on dividing the population into occupations or classes, find that inequality (of households, not individuals) in the United States increased between 1774 and 1860 when his study ends. Steckel and Moehling (2001) find that inequality had increased in New England during the period we are studying, based on tax lists.…”

Mary Parker Follett, managerial responsibility, and the future of capitalism

“…As organizations pursue ever-cheaper labor and pay for those at the top increases, we see a widening level of income inequality (Lin & Tomaskovic-Devey, 2013). This creates a central vulnerability for capitalism rooted in the historically high levels of income inequality present in the United States (Lindert & Williamson, 2012;Saez, 2012). This is a particular concern when compared to levels of inequality in other industrialized countries, as there is growing evidence that more equal societies are also healthier and happier societies (Wilkinson & Pickett, 2011).…”

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“…It is in effect known that Southern colonists were "wealth-older" and accumulated more capital than the Northerners even if we exempt slaves. Per capita incomes in the South were also higher until early 19 th century (see Lindert and Williamson, 2012).…”