Wages, prices and living standards in a growing economy. The case of Boston, Massachusetts

Abstract

This study analyzes the living standards of laborers in Boston, Massachusetts in 1785-1900. Using a linear programming model, I find the food basket that provided a balanced nutrition at the lowest possible cost. Then, I estimate the welfare ratio of laborers. The evidence shows that laborers in Boston earned enough to cover their basic needs, and that their real wages increased in the 19th century. The results also show that the welfare ratio of laborers in Boston was higher than the ratios of several European cities. Boston can be considered a high-wage economy during the late 18th and 19th centuries.