EH.Net Abstracts in Economic History

               EHS Abstract Submission
                    (c) 1996 EH.Net
-----------------------------------------------------------
              Name:  Brad Hansen
               Email:  bhansen at MWCGW.MWC.EDU
         Institution:  Mary Washington College

       Co-author:  None

             Title:  The Golden Age of Flexible Wages in The
South: Labor Markets in Virginia during the Panic of 1907

  Internet Address
of abstracted work:  Not available on the Internet

           By mail:
                     Brad Hansen
                     Mary Washington College
                     Fredericksburg VA 22401
                     USA

          Language:  English

          Abstract:
   One of the most widely held perceptions about U.S
macroeconomic history is that wages and prices were more flexible
prior to World War II. Numerous macroeconomic theories, as well
as theories of labor market adjustment, have arisen around this
generalization. Recently, however, a number of authors have
questioned the existence of this golden age of flexible wages. In
particular, a number of studies utilizing data from state bureaus
of labor statistics have suggested that labor markets at the turn
of the century already exhibited considerable wage rigidity. In
this paper I use data from the Virginia Bureau of Labor and
Industrial Statistics to examine the degree of wage flexibility.
Specifically, I examine the changes in daily pay during the
recession of 1907-8. In contrast to other recent studies using
state BLS data, I find that the evidence from Virginia tends to
support the traditional view of highly flexible wages; the mean
wage fell 3.8 percent from 1907 to 1908, an index of wages fell
5.7 percent, and over 50 percent of occupations experienced
decreases in the mean daily pay. In addition, the Reports of the
Virginia Bureau of Labor and Industry also allow us to consider
an issue neglected in previous studies of labor market
adjustments: the historical experience of different groups during
recessions. Specifically, were the changes in wages and
employment experienced by women and African Americans the same as
those experienced by white males? The evidence from Virginia
suggests that movements in wages for black workers led those of
white workers in both the contraction and the expansion phases of
the business cycle.


      Bibliography:  Hansen, Bradley. "The Golden Age of Flexible
Wages in the South: Labor Markets in Virginia during the Panic of
1907."	Paper prepared for the ASSA/Cliometric Society Session,
January 1997, New Orleans.


                  Subject:  T
 Geographical Area:  7
      Country/Region:  US South
           Time Period:  8