For the Weekend...
Reading: Lant Pritchett (1997): Divergence, Bigtime

Reading: William Nordhaus (1996): Do Real-Output and Real-Wage Measures Capture Reality?

William Nordhaus (1996): Do Real-Output and Real-Wage Measures Capture Reality?: The History of Lighting Suggests Not

Let's go through the argument:

  • Standard measures tell us that real wages in the North Atlantic grew at an average rate of 1%/year in the 19th century and 2%/year in the 20th century.

  • But let's look at the price of light: it suggests that growth has been much faster:

  • A wax candle emits 13 lumens, a 100-watt filament bulb emits 1300 lumens.

  • Hours of work to pay for one hour's worth of light from a 100-watt filament bulb:

Cursor and Preview of Reading William Nordhaus Do Real Output and Real Wage Measures Capture Reality

  • Growth in lighting technology:

    • A factor of 2000 since 1900: 7.6%/year
    • A factor of 25 in the 19th century: 3.2%/year
    • A factor of 8 in the previous 1600 years: 0.13%/year
    • A cumulative factor since 1800 BC of: 400,000
  • How much of what we make is "like" light?

  • Consumption:

    • Run-of-the-mill sectors: 28%
    • Seismically-active sectors: 36%
    • Tectonic-shift sectors: 37%

Cursor and www nber org chapters c6064 pdf




NewImage key: <>