Introduction
In recent years, economic history and social history have witnessed a “global turn”, often accompanied by the rise of several major questions aiming to explain phenomena such as global inequality, mass migration, and diverging standards of living.Footnote 1 Often, such “big-question”-driven studies are firmly grounded in the collection and analysis of “big data”: large, encompassing, and internationally comparative historical datasets, enabled by key advances in digital infrastructures and software technology.Footnote 2 In the field of labour history, these shifts in focus and methodologies have stimulated the emergence of Global Labour History (GLH). At the International Institute of Social History in Amsterdam this approach has been central since around 2000.Footnote 3 It involved a “reorientation” of labour history, which, according to Marcel van der Linden and Jan Lucassen, suffered from “geographical, temporal, and thematic limitations”.Footnote 4 Over the past fifteen years, this approach has proven to be fruitful in terms of research projects,Footnote 5 Nachwuchs in the form of initiatives and organizations stimulating GLH in all parts of the globe,Footnote 6 and data collection.
Regarding big data on labour history, the most prominent project has been the Global Collaboratory on the History of Labour Relations (hereafter, “Collab”), started by the IISH in 2007 in order to systematically collect and analyse data from throughout the world on the development of labour relations from 1500 to the present. In the process of data gathering, and through the interactions among the many scholars collaborating in this project, a sophisticated taxonomy of labour relations has been designed and continually refined over the years, in order to map labour relations, and shifts in labour relations, over time and in different regions of the world.Footnote 7 The Collab has an ambitious outlook and has a large chronological and geographical scope. It aims to answer questions concerning what types of labour relations have existed worldwide, what changes have occurred since 1500, and how we can explain these shifts in labour relations.
Without doubt, these are relevant questions. However, I think this project – often presented as the empirical “backbone” of the GLH research programme – has, so far, been rather inward looking. Firstly, it focuses too much on the description and explanation of labour relations in themselves. Secondly, broader debates, theories, and methodologies outside the field of social and labour history are largely ignored. Although Van der Linden has urged researchers to “be bold in their inquiry and dare to venture outside their own familiar terrain”,Footnote 8 this has not yet been put into practice satisfactorily. Whereas, in recent years, many economic historians have quite successfully integrated labour into their studies of long-term global inequality, there is little interaction between the fields of global economic history and global labour history. In part, this can be attributed to economic historians having a blind spot for new developments and publications in labour history.Footnote 9 Nevertheless, I also agree with Leo Lucassen’s recent statement that “social historians should be much clearer about the causal connection between [labour] relations and broader themes”.Footnote 10 Instead of treating labour and labour relations as the variable to be explained,Footnote 11 labour historians ought to explore more carefully to what extent, and how, labour and labour relations have been an explanatory variable for broader socio-economic developments.Footnote 12
Whereas Lucassen has made a plea for migration history as a perfect bridge to bring together labour relations and labour as an independent factor, as well as for linking individual agency and collective action,Footnote 13 this article proposes plucking the fruits of such a connection between global labour and economic history. It aims to answer two, highly related, questions. First: what can global labour historians learn from recent economic historiography, in terms of raising questions, integrating theory, and applying methodologies (or, if you will, empirical strategies)? Second, and equally important: what vital contributions can GLH make to the major debates and explanatory frameworks typically used by economic historians? I will argue that instead of isolating itself in the sphere of “social history”, “labour relations”, and “social movements”, or complaining that economists and economic historians have “hijacked” the issue of labour, GLH should open up to a dialogue with scholars and debates in these fields.Footnote 14 GLH has much to gain from recent studies in economic history. In turn, GLH can offer current and future generations of economic historians valuable insights. This argument is illustrated as follows. First, several important debates in recent economic history are identified, highlighting the role labour has played – or should play – in these debates. Second, it is argued that GLH could engage more with economists’ theoretical concepts and traditions. Finally, I point out how global economic historians and global labour historians can learn from each other in terms of empirical strategies. Before engaging with this three-tier argument, I will briefly highlight the merits as well as the pitfalls of GLH in its present stage.
Global Labour History: its Merits and Blind SpotsFootnote 15
The “Old” Labour History, established around the turn of the twentieth century, was inspired by Marxism, trade unionism, and other social activism. Labour historians such as Sidney and Beatrice Webb studied the development of labour organizations, political debates, socialist parties, and strikes. As a result, labour history focused mainly on organized, male, wage labour in the industrializing and industrialized Global North: nineteenth- and twentieth-century Europe, North America, Oceania, and Japan. The rise of the New Social History in the 1960s also entailed a New Labour History. Its proponents, such as E.P. Thompson and Eric Hobsbawm, stressed the need to contextualize labour struggles in societal structures and cultural praxes. This approach involved looking beyond political struggles, trade union leaders, and successful strikes, instead examining the actual work and living experiences of “ordinary” members of the working classes – who, incidentally, were not always active members of the labour movement.Footnote 16 In the 1970s and 1980s, neo-Marxist and feminist historians, as well as scholars of race and ethnicity, developed this line of research further by including everyday forms of resistance, women, and non-white workers in their analyses.
Despite these advances, however, the “New” Labour history, too, remained predominantly confined to the Global North. From the early 1990s onwards, scholars from the Global South – particularly Latin America and Asia – began to produce histories of labour in colonized societies and developed “subaltern” visions of colonial labour relations. They explored new issues in their labour history and formed new organizations and networks for the study of labour.Footnote 17 Such endeavours to come to a less Eurocentric approach to labour history were an important source of inspiration for the emergence of Global Labour History. In 1999, the research directors of the IISH, Marcel van der Linden and Jan Lucassen, introduced the GLH research approach, urging scholars to focus on a more inclusive and transnational labour history.Footnote 18 This should include the study of forms other than waged work – for instance, coerced and subsistence labour, groups of workers other than the white male industrial worker, and forms of workers’ organization and resistance other than trade unions. Most importantly, the study of labour in all parts of the world as well as in the pre-industrial period ought, they argue, to be included in order to allow sensible comparisons and connections over space and time.Footnote 19
This broadening of the field of labour history has been worthwhile. It has stimulated many researchers all over the world, and resulted in a number of interesting research projects and publications.Footnote 20 Despite its merits, however, there are a number of serious drawbacks in the way GLH has been practised so far, some of which have already been addressed by others.Footnote 21 My main concern is that GLH seems to have drifted away from important debates in global history, as well as from more theoretical insights. Even if the programme, or “area of concern”, as Van der Linden prefers to call it,Footnote 22 has attempted to engage in the construction of “big data”, the questions and analyses relating to this large collaborative database have hitherto been predominantly inward looking.
As noted in the introduction, the empirical backbone of the GLH approach, the Collab at the IISH, is an impressive collaborative project with many contributors from all over the world. Based on an elaborate categorization of labour relations, in recent years a team of researchers has constructed a big dataset of labour relations worldwide since 1500. While this database has been under construction since 2007, many of the discussions within the collaborative group have remained in the sphere of definitions (how to categorize different types of labour relations) and data problems (gaps in the data, issues of comparability), instead of moving forward to analyses and making sense of the data. Although these exercises have, up to a point, undoubtedly been very useful and necessary, often, when a new participant or dataset joins the project, we have seen such discussions having – at least according to my experience until quite recently – to be reopened, which hampers the project. Moreover, over the past ten years or so there have been relatively few attempts to team up with other constructors of global datasets, to learn from their best practices, and to link the data on labour relations to other large datasets with other explanatory variables.
More importantly, the Collab’s main aims are to address the following questions: “What shifts in labour relations took place, and when?” and, in its second phase, after having collected much of the data, the more analytical question of “How can we explain these shifts in labour relations?” Despite the validity of these questions, they are not ambitious enough. We can, and should, bring GLH much further, by engaging in current debates in economic history that have, over the past fifteen years, greatly affected the historical discipline and even present-day policymaking. To quote Prasannan Parthasarathi: “To truly advance th[eir] agenda, global labor historians must pose new questions or provide new answers to longstanding problems”.Footnote 23 In economic history, labour on a global scale has been central in several debates, theoretical approaches, and research methodologies. Often, these historians seem unaware of, or uninterested in, the developments in GLH. Although this can partly be attributed to the blind spots these economic historians have, there is also a responsibility on the part of global labour historians, who seem to be directing their work towards different audiences and addressing quite different research questions.Footnote 24 There would be much to gain from more communication, or even integration, of the results from both disciplines.
While the importance of social relations for the study of labour is evident, the lack of attention paid to the “economic” in current GLH is seriously disturbing. By focusing predominantly on labour relations and social movements, the relationship to other factors of production in the various regions of the world that are under study, such as land and capital, are generally overlooked. Moreover, issues of wages and income, labour productivity, and skill, important indicators of the quality of labour, are mostly discarded. These elements do feature prominently in many recent studies and debates in global economic history, as I will show. In what follows, I will establish what global labour historians may gain from including these studies and engaging in the debates, theories, and empirical strategies of economic historians. At the same time, I will assess what benefits the GLH approach may offer economic historians, especially regarding a much more careful inclusion of varieties of labour relations in their analyses, as well as a level of detail and fine-grained historization of the generally coarsely painted picture of economic development provided by economic historians.
Divergence and Convergence: Debates in Economic History about the Roots of Global Inequality
Just as most social historians are ultimately interested in describing and explaining social inequality,Footnote 25 many economic historians are preoccupied with tracing and explaining the roots of economic inequalities. Obviously, social and economic inequality are closely related, and can be established and analysed on multiple levels (the household, the village, the region or nation, and worldwide). In this section, I will focus on global inequality in terms of economic development, and the debates pertaining to this theme that have been prominent in economic history over the past fifteen years. These debates deal primarily with the divergence (or convergence) of different regions of the world in terms of economic growth, and the mechanisms underlying such processes of divergence and convergence. Whereas labour plays a prominent role in some of these debates, from which labour historians can draw inspiration, in other strands of the literature labour is either taken as a given or is not problematized, presenting an opportunity for labour historians to enter the stage.
Probably the most debated theme in economic history over the past fifteen years has been the “Great Divergence”, and the timing of, and the mechanisms behind, the diverging economic trajectories of the “West” and the “Rest”.Footnote 26 Since around 2000, economic historians of Asia have argued – in contrast to what scholars from Max Weber to David Landes have contended – that the conditions for economic development in Asia and Europe did not differ significantly before c.1800.Footnote 27 It was not until around the turn of the nineteenth century that the two parts of the world started to diverge. An important explanation was that Europe – especially Britain – resorted to the availability of coal and colonies to solve the problem presented by the increasing scarcity of natural resources and land.Footnote 28 Other scholars have refuted the timing of this divergence and argued that Europe, most notably its north-western parts, had already achieved a much higher level of economic development long before 1800. The proponents of this opposing “European exceptionalism” view offer a range of explanations to argue that the foundations of self-sustained economic growth, in terms of market orientation, knowledge, and technology and institutions, had already been laid in the pre-industrial period.Footnote 29 Some of these historians even referred to a “little divergence” within Europe, ultimately leading to economic development in north-western Europe, but not in other parts of Europe.Footnote 30
Remarkably, labour plays a pivotal role in many of the discussions, often in relationship to other variables, such as other factor endowments or institutions. For instance, Ken Pomeranz argues that, before 1800, the use of both labour and land in China “conformed to the principles of ‘market economy’ at least as well as it did in Europe and likely somewhat better”.Footnote 31 Ultimately, however, his argument revolves around divergence in the availability of other production factors, most notably “coal” and “colonies”; labour largely remains in the background. Other proponents of the Great Divergence thesis have mentioned the price of labour as a decisive factor. For instance, Rosenthal and Wong have argued that, for pre-1800 China, comparing real wages with Europe results in serious distortions, as the economic activities of all members of the predominant extended household generated income beyond wages, and have to be taken into account when making comparisons.Footnote 32 And Parthasarathi has claimed that, until 1800, Indian spinners and handloom weavers were able to outcompete Europeans due to their much lower nominal wages, while their real wages were similar or even higher.Footnote 33 Interestingly, accounts of the price of labour (nominal as well as real wages) in Europe and Asia have, at the same time, been utilized to argue that there was already a “high wage economy” in pre-industrial Europe, which formed the incentive for its industrialization from the eighteenth century onwards. This literature instead places the “great divergence” much further back in time.Footnote 34 Within Europe, too, wages and labour relations have been adduced to explain the divergence between north-western Europe and other parts of the continent. Robert Allen, for instance, sees the high wage economy of Britain, and the relative scarcity of labour, as the key element in explaining technological advances leading to industrialization.Footnote 35 Others have explained the economic rise of north-western Europe by pointing to the importance of wage labour in the region, related to institutions that were relatively egalitarian (for instance between the sexes and generations), favouring small families, late marriage, and public poor relief.Footnote 36
However, most of these analyses suffer from the flaw of focusing mainly on wage labour in the formal sector. Although wage labour may have been on the rise, it did not constitute the only (or the most important) labour relation in most regions of the world in the pre-industrial and industrializing period. As labour historians have recently argued, the development of capitalism, also in the West, coincided with many varieties of labour relations, including forced labour and subsistence labour.Footnote 37 Moreover, much of the “real wage” literature focuses on male labour, thus disregarding the income generating activities of women or children.Footnote 38 Here, the insights of GLH, with its much more inclusive definition of labour, ranging from subsistence agriculture to self-employment, and embracing the importance of women’s and children’s contributions to household income, as well as non-monetary forms of compensation for work, such as food and boarding, or payment in kind,Footnote 39 can help to avoid the rather short-sighted and deterministic reasoning of many economic historians.Footnote 40 One example is mapping and modelling the variety of labour relations by gauging the degree to which individual household members were actually involved, with an eye to the fact that there were often simultaneously multiple labour relations, and shifts over the life course. This research should consist of both quantitative and more qualitative analyses of the work allocations of households, using a variety of sources extending beyond the national census.Footnote 41 An additional method involves estimating what contributions various household members made to the household budget in terms of monetary wage, in-kind payments, or foregone expenses as a consequence of self-provisioning. While this is a daunting task, recent research shows that it is possible to produce reasonable estimates of such forms of income.Footnote 42 Below, I will elaborate on this further, but first let us explore two other debates related to global economic divergence: on the colonial roots of inequality, and on labour-intensive industrialization.
Certainly, the debate on the colonial roots of inequality goes back as far as the immediate postwar era, when neoclassical economists and dependency theorists discussed their quite opposing – and highly ideologically-laden – views on the stagnating development of the “Third World”. Labour implicitly played a role in this debate, in terms of a lack of productivity owing to lagging industrialization and “backward” work ethics/culture.Footnote 43 In the 1970s, a more historical dimension was added to the debate by the “World Systems Theory” (WST), coined by Immanuel Wallerstein, who explicitly linked socio-economic inequality to the extension of capitalism since the sixteenth century. According to this theory, the capitalist (north-western) European “core” extended its power by systematically exploiting the world’s “periphery” through unequal trade relations, with the latter mostly providing raw materials for high value-added economic activities in the core. An intermediate category of countries constituted the semi-periphery, which have mixed characteristics of core and periphery, and can rise or fall in the hierarchy of development.Footnote 44 Despite its highly criticized (while deterministic) worldview, WST has nevertheless inspired Global Labour History, because of its roots in Marxist thinking, and its ideas on the global divisions of labour that emerged with the spread of capitalism after the early modern period.Footnote 45
More recently, the colonial origins of inequality have been studied by economists and economic historians, a literature that unfortunately has not yet been picked up by most global labour historians, perhaps due to their more indirect links to the history of labour and labour relations. In a number of publications, for instance, Acemoglu, Johnson, and Robinson (AJR) have argued that the current divide between poor and rich countries can be directly related to the fact that, around 1500, Europeans set up or maintained “extractive institutions” in those overseas areas where they did not settle in large numbers themselves, whereas they implemented “inclusive”, and thus growth-benefiting, institutions in colonies such as North America and Oceania, where whites did eventually settle.Footnote 46 Another approach has been taken by Jeff Williamson, who argues that globalization, induced by the transport revolution in the early nineteenth century, deepened existing commercial specialization, leading to a worldwide division of labour. This was driven by movements in terms of trade, favouring a focus on tropical export commodities – and thus “deindustrialization” – in what he calls the “poor periphery”, whereas the “core” industrialized and specialized in the global provision of highly valued and more price-stable goods and services.Footnote 47 While Williamson’s thesis seems to bear a relationship to WST, using terms such as “core” and “periphery”, it actually adopts a much more neoclassical economic stance, because it takes market forces, rather than power imbalances, to have been the driving mechanisms behind this development since 1800. In his model, he takes a similar neoclassical approach to labour, seeing it as fully employed, as substitutable between sectors (thus disregarding, for instance, skill or a gendered division of labour), and as being completely competitive between countries.
Global Labour History is perfectly suited to advancing such economic studies on the colonial roots of development and underdevelopment. Firstly, the study of labour and labour relations worldwide helps us to investigate changes in the short run, which may be vital to explain different developments between regions and between periods, something overlooked by the broad strokes of scholars such as AJR. A good example of this is the work of Gareth Austin, who has convincingly argued against AJR’s “compression of history” by showing that, for Africa (but it might well be applied to other regions), it is important to take into account the “time-specific interaction between resources and political economy”Footnote 48 in order to come to a much more dynamic, and far less linear, picture of economic development. This more nuanced and historically grounded approach involves, for instance, taking into account the economic effects on Africa in its shift from a traditionally labour-scarce to (more recently) a labour-abundant continent. Also, looking at how, over the past 500 years, different African societies have responded to the challenge of labour scarcity may help explain the paradox of why Africans became actively involved in the Atlantic slave trade, even under labour-scarce conditions. Moreover, it enlightens us on particular choices in labour-productivity-enhancing technology in specific African contexts, which helped advance certain pre-colonial (for example, before the late nineteenth century) African economies, whereas others developed quite differently.Footnote 49 Another example is the recent work by Rossana Barragan on the silver mines in Potosí. Barragan offers a detailed analysis of labour relations in the mines, and shows how the distinctions between free and unfree labour should be regarded as blurred. This nuances, Barragan argues, the degree of extractiveness that AJR ascribe to the Spanish colonial regime compared with what the British did in their colonies. It shows how scrutinizing labour relations at a micro or meso level can shed new light on debates on institutions and property rights.
In another respect, GLH can reveal important linkages between the macro and the micro, as Van der Linden has justly noted.Footnote 50 As I show in a recent article, Williamson’s deindustrialization thesis should be seriously questioned, at least when it concerns colonial Java. Supplementing the macro picture of international trade statistics with regional sources and more qualitative evidence reveals that local producers – often overlooked indigenous women, performing part-time weaving and cloth-printing – responded quite flexibly to the textile imports of the Dutch colonizer. For instance, Javanese households began to reallocate women’s time-consuming spinning labour into the more efficient hand weaving, using factory-made imported yarns. Moreover, the research points to the importance of specific traditions in skills of indigenous labourers, who grasped the opportunity to develop niches of high-quality and much-demanded textiles by Javanese consumers. This refutes the Ricardian assumption made by Williamson of perfect competition in international labour markets.Footnote 51
These observations lead us to another relevant recent contribution to the divergence (or convergence) debate in economic history, which highlights the importance of paths towards development other than the North Atlantic trajectory, namely the concept of “labour-intensive industrialization”. As Austin and Sugihara have forcefully argued, particularly East Asia, but also other parts of Asia, Latin America, and Africa, utilized labour instead of capital or land to compete in the world market, most notably in industrial production.Footnote 52 Very important in this competitiveness were not only the relatively low wages, but also the comparatively high quality of labour in certain parts of the world. Especially in East Asia, a distinct tradition of skill formation, often derived from artisanal and other small-scale modes of work organization, developed in combination with a particular labour discipline. This led many economies in Asia to grow along pathways different from those seen in Western Europe, and may even go a long way in explaining the success of some “growth economies” in the Global South today.Footnote 53 It is clear that issues such as the quality of labour and labour discipline appeal to the – often more qualitative – approach to work and labour relations that many global labour historians embrace. At the same time, it might be good if GLH, in turn, were to include on its agenda important quantitative measures of skill formation and productivity, as the quality of labour may indeed be an important key to explaining economic development and divergence in global history, as well as to explaining shifting labour relations.
Expanding Glh’s Theoretical Horizon: Influential Economic Theories on Labour
Underlying the above debates are implicit and explicit theoretical frameworks that I will now address. From its onset, Global Labour History has refrained from any strong involvement with theory. In fact, in their Prolegomena of 1999 the only instance of the word is when the authors refer to Marx’s theory on wage labour.Footnote 54 In his 2012 position paper, Van der Linden explicitly states that GLH “is not a ‘theory’ in its own right”, but he does not go on to elaborate how this field of interest relates to theory in any way. Nevertheless, it is very important to engage with theory, for at least two reasons. First, theoretical frameworks enable the formulation of grand hypotheses and research questions, leading to influential academic debate. Second, it allows us to test certain assumptions, and revise or nuance them from the perspective of empirically informed quantitative and qualitative research on labour and labour relations, thus bringing labour in as an important explanatory variable in more universal hypotheses on socio-economic development and inequality over space and time.
Here, global economic history can be of great value to GLH, as it tends to have a more explicit tradition of engaging with theory and formulating hypotheses. Most important in these respects for the study of labour in recent years have been theories of Factor Endowments, New Home Economics (in particular, Becker’s theory of time allocation), and New Institutional Economics. This is not to say that other (or non-economic) theories are insignificant or should be ignored, but a selection had to be made, and these have – implicitly or explicitly – been particularly influential in recent debates in global economic history in relation to labour.
The theoretical framework of factor endowments links up labour to other factors of production, but also to economic development and global inequality. For instance, with regard to the Little and Great Divergence debates, it has been argued that Western Europe experienced a relatively early development of factor markets, which may explain its rise to economic hegemony in world history.Footnote 55 But there are more opportunities for linking economic and labour history within this framework. The notion of the relationship between the relative scarcity of labour to land has, for instance, been influential in theoretically explaining the occurrence of forced labour relations for over a century now, and is also known as the Nieboer-Domar thesis. In brief, this thesis states that under conditions of relative land abundance and labour scarcity slavery or other forms of bonded labour were economically more viable than alternative forms of labour relations.Footnote 56
While the Nieboer-Domar thesis has not remained uncontested, Stanley Engerman and Kenneth Sokoloff elaborated on it in the 1990s. They applied a somewhat broader definition of factor endowments (because they included the endowment of natural resources, such as tropical cash crops) and expanded the thesis by including the importance of institutions in shaping factor endowments. Although, according to Engerman and Sokoloff, institutions may have been important in shaping factor endowments and their redistribution in a given society, the initial factor endowments were crucial for the development of such institutions in the first place. This may explain why societies with an abundance of natural endowments and forced labour, thus with huge inequalities, such as Brazil, had far fewer incentives to develop and sustain democratic and growth-inducing institutions than, say, the United States.Footnote 57 Here, the study of factor endowments, labour relations, and economic development come together nicely in a framework that deserves further research in other parts of the world using the more refined historical analysis that GLH can offer. Good examples include more recent studies by Gareth Austin and Erik Green, who pay due attention to the seasonality in demand for labour, thus explaining both the coexistence of various types of labour relations (slave labour and contract labour for example) and of agricultural and non-agricultural economic activities in different parts of Africa.Footnote 58
Apart from merely focusing on labour as an important factor of production, global labour historians would do well to link up with the development of factor markets for land and capital. So, for instance, the control over landownership, and the degree to which people are allowed to acquire land, directly relate to labour, in the sense that the latter dictates “the mechanisms by which a population can be made to work for others”.Footnote 59 On another note, capital-intensive production could be stimulated by the relatively high price of labour in a given society, as Robert Allen has argued in the case of Britain for instance.Footnote 60 In contrast, Engerman and Sokoloff have argued for the US that productivity growth was not necessarily bound to capital-intensive industries, but that improvements in technology were advanced much more broadly, due to relative equality among the population in relation to their access to markets. This stimulated productivity increases within smaller farms and firms that were based not so much on capital-intensity, but rather on labour-intensity.Footnote 61
Engerman and Sokoloff’s interpretation bears a remarkable resemblance to the concept of the “industrious revolution”. This term, which Akira Hayami coined in 1977 to describe the rise in pre-industrial labour-intensive productivity in East Asia, was adopted and made famous by Jan de Vries in explaining economic development in north-western Europe before industrialization – economic development based less on capital input than labour. De Vries assumes that between about 1650 and 1850 households intensified their labour input – not out of necessity, but because of their changing consumptive desires. This growing industriousness involved a reallocation of the available time of all household members: male workers shifted from leisure to more work, and women and children became increasingly involved in working for the market. De Vries’s industrious revolution thesis – which empirically is still very much debated, especially with regard to the underlying mechanism of a consumer revolutionFootnote 62 – is inspired by the theoretical framework of “New Home Economics” that has been developed since the 1960s. The work of Jacob Mincer and Gary Becker has been particularly influential in many of the empirical and theoretical models adduced by economists since then. A central principle of these models is the importance of the decision-making process at the micro (household) level, especially regarding the allocation of men’s and women’s time.Footnote 63 It is assumed that the household is a utility-maximizing unit that bases its decisions regarding time allocation on the opportunity costs of labour of the different family members.Footnote 64
Over the years, the assumptions behind Becker’s time-allocation household model have encountered fierce criticism. For one thing, it focuses too much on the household as a unitary decision-making entity instead of applying a bargaining model assuming diverging interests between the different household members, with an outcome stemming from unequal power relations between the sexes and the generations.Footnote 65 Moreover, the model has been criticized for departing too much from the assumption of rational (economic) choice, thus not paying attention to social and cultural forces determining household behaviour and the allocation of time spent on work, reproductive tasks, consumption, and leisure.Footnote 66 Despite such criticisms, the models of New Home Economics may have a major advantage for the study of labour. Not only do they include the labour time allocated among the different household members, they also place production, reproduction, and consumption in the same analytical framework, and they include foregone earnings of goods and services (such as care and cleaning). This all fits with GLH’s more inclusive approach to work. At the same time, GLH can add to the models of New Home Economics by the historical inclusion of household behaviour and labour relations in non-Western societies, and by highlighting the social and cultural aspects influencing household labour relations in the past.Footnote 67 Introducing power relations – between the sexes, the generations, social classes, and the different regions of the world – and the institutions underpinning such power relations is an important aspect of the contribution GLH can make.
This brings me to the final theoretical framework I wish to highlight in this article: New Institutional Economics (NIE). NIE arose in the late 1960s, with, as its most important proponents, Douglass North and Oliver Williamson, who were discontented with the standard neoclassical approach of perfectly functioning markets. Instead, they proposed that institutions (in brief: rules and norms shaping human economic behaviourFootnote 68 ) are highly important in stimulating or hampering the functioning of markets, for instance through the extent to which they safeguard property rights, information exchange, or contract enforcement. A set of institutions favouring such preconditions for market exchange leads to a greater degree of trust and to lower transaction costs, which explains why in some contexts markets are more developed than in others.Footnote 69 Many economists, as well as economic historians, have been inspired by the institutional approach, as it has brought history into economic theory, in the sense that it has allowed for more historically contingent “path dependent” explanations of divergent economic developments. For instance, the above-mentioned research on the colonial origins of global inequality by Acemoglu et al. heavily emphasizes the importance of “extractive” institutions in the persistent underdevelopment of large parts of the globe into the present.Footnote 70
As much as it has been praised, NIE has also been severely criticized. Firstly, the institutional approach remains grounded on the idea of rational choice (or “methodological individualism”): the homo economicus makes deliberate decisions that favour a most efficient outcome in terms of cost reduction. Secondly, and related to this, this presupposes the a priori existence of markets, whereas, as some critics have suggested, markets ought to be seen “as a consequence, not the cause of historical development”.Footnote 71 Thirdly, by suggesting that economic development is sustainable only through “open-access”, democratic, institutions, it ventures a neo-liberalist, deterministic approach that suggests that the blueprint of “Western” capitalist societies is also the path to follow for the rest of the world, moreover denying alternative paths to growth such as that witnessed for Communist China in recent decades.
Finally, many institutional economists, though acknowledging the importance of historical developments, often fail to map and explain the process of institutional change over time – stressing instead the persistence of particular institutions.Footnote 72 This was exactly the critique ventilated by Gareth Austin on AJR’s thesis of the “Reversal of Fortune”, which assumes that the institutions set up around 1500 are still relevant for today’s economic performance, thus neglecting historical as well as regional differentiation in the intermediate five centuries.Footnote 73 Part of this unrefined approach to the past stems from the methods AJR and other proponents of NIE generally use: cross-country regression analyses that often compare two points in time, usually with a gap of centuries, in which the changes between the start and the end are usually neglected. Moreover, especially for very early periods, the data used in such regressions is often “shaky” and presented with much more statistical confidence than the – often scattered and backward-projected – evidence allows for.Footnote 74
Why and how, despite such notable and relevant criticisms, should labour historians engage with the institutional approach? First, the hypotheses posed by NIE are sweeping and inspiring to verify or falsify, or at least nuance, using the fine-grained temporal and regional analyses that historians have to offer. So, even though, as Hopkins has so appropriately put it, “[h]istorians know as well as economists that it is much easier to be right about small matters than to be illuminating about big ones”,Footnote 75 it is the big questions and statements of approaches such as NIE that are worthwhile testing. Second, and this relates to the “how” question, it is in the combination of various strands of theory that labour historians can play a role. For instance, the relationships and interplays between factor endowments and institutions can offer new and more refined explanations.Footnote 76 So, labour historians can make comparisons over time that do involve the question of how changing labour relations led to changes in institutions, and why they differed in various parts of the world in terms of timing and effects. Also, they can bring “informal” institutions such as values and ideologies into the picture. For instance, an ideology of “free labour” may help explain why, in certain societies and periods, despite the occurrence of wage labour, self-employed farming and artisanship were preferred over factory labour, such as in the United States in the nineteenth century.Footnote 77 Also, including racialized and gendered norms into our analyses will help us better understand why some institutions and rules, such as protective labour legislation, came into being in some parts of the world, and not in others, even if they were administered by the same (imperial) government.Footnote 78 The way to achieve this is to integrate quantitative and qualitative methods, and to bring non-economic factors shaping power relations into the analysis, which brings us to some examples of empirical strategies that GLH might want to explore.
Introducing Power Relations: Empirical Strategies in Global Economic History and Global Labour History
Living standards are an important indicator of economic development. At the same time, they are directly connected with labour, as the majority of the world’s population derives – and historically has derived – its income, whether in money or in kind, from the fruits of labour. Economic historians have long engaged in constructing series of real wages in order to measure the development of living standards over time.Footnote 79 Until now, the most sophisticated method of measuring living standards was that developed by Robert Allen, who relates nominal wage data in a given period to the assumed consumption patterns of households by composing a basket of (minimally) consumed goods. This way, one can calculate the so-called welfare ratio, i.e. the number of consumption baskets that a household can buy from the male wage at a given time, with one basket equalling the subsistence ratio. This method has two major advantages: firstly, it can be compared over space and time; secondly, it can account for both changing wages and consumer preferences in different regions and periods, thus allowing one to consider relative living standards – the historian has only to change the composition of the basket.Footnote 80 This method has recently been applied by many economic historians in order to calculate welfare ratios in different parts of the globe.Footnote 81 Nevertheless, Allen’s method makes a number of assumptions that do not conform much to historical reality. For one thing, such studies are based on collections of wages of men, assumed to have been employed throughout the year in construction or agriculture. With some exceptions,Footnote 82 the income-generating activities of other members of the household are disregarded, whereas the male breadwinner ideal has been an “exception in history”.Footnote 83 Moreover, in many parts of the world, up until today, income from wages has been far less important than income from subsistence agriculture or in-kind payments, which are totally disregarded by the welfare ratio method.
Here, global labour historians and the Collab project can make a huge contribution by placing the (male, monetary) real-wage approach in a more nuanced and historically accurate perspective. It can, for instance, pay explicit attention to the different income-generating activities caused by wage labour relations other than self-employed labour, reciprocal labour, and subsistence agriculture, by modelling different constellations of labour relations over space and time and by gauging the share of household income contributed by such labour relations. For this, we need to look beyond series of wage data, and use, for instance, household surveys with budget data, which often explicitly or implicitly refer to the income-generating activities of different household members, and often quite accurately report consumption data.Footnote 84 This empirical strategy allows us to historically apply Becker’s concept of the allocation of labour, even if the sources do not always tell us the exact duration spent by households on the different activities (though sometimes they do). Moreover, household surveys also often provide information on landholding and household savings, which offers opportunities to analyse work activities in the wider framework of combined factor endowments: labour, land, and capital.
With regard to studying factor endowments, another approach recently adopted by global labour historians can be quite enriching and complementary for economic history. This is the “Global Commodity Chain” (GCC) approach, which looks at how commodity production, from raw material to end product, comes about and moves across the globe.Footnote 85 The approach was coined in 1977 by Hopkins and Wallerstein as a way of explaining how the international division of labour emerged with the spread of capitalism in the modern world system since about 1500. A number of studies appeared analysing the “creation, cultivation, and transportation” of particular commodities as a chain that moves over the globe. In the process, value is added to the product, which inevitably leads to unequal returns to labour in these activities, contributing to a stratified world system and increasing global inequality.Footnote 86 The advantage of the GCC approach is that labour relations can be analysed from a micro or meso (for example, regional, firm-level) perspective, but in relation to the globalized economy. This allows for a differentiation of labour relations across the world – along the “value chain” – and will thus not only shed light on power relations leading to specific labour relations at particular places in particular periods in relation to globalization, but also tell us how labour contributed to economic development in different parts of the globe.Footnote 87
Many of the studies applying the GCC approach have used it to explain the occurrence of the “New International Division of Labour” (particularly the rise of East Asia) since the 1970s, and have also been enthusiastically taken up by international organizations such as the WTO and the World Bank.Footnote 88 It is only recently that some historians have tried to adopt this approach to analyse GCCs further back in time, for instance for sugar,Footnote 89 diamond,Footnote 90 rubber,Footnote 91 and cotton production.Footnote 92 A collaborative project on tropical agricultural commodities over the past few years has also followed this approach, the results of which will be published soon.Footnote 93 Apart from industry and agriculture, the idea of a GCC has also recently been adopted for the service sector, to explain international divisions of labour in domestic and caregiving work.Footnote 94 These studies do indeed show that, often, unequal power relations existed through which multinational companies, colonial governments, or even rich households in the West could employ cheap labour in “peripheral” parts of the world, including enforcing institutions of coerced labour,Footnote 95 whereas the higher-valued production processes were allocated to “core” regions. Nevertheless, these studies also point to the danger of drawing too linear conclusions about power relations. For instance, they stress the role of indigenous parties gaining considerable agency (for instance local firms, or labour intermediaries),Footnote 96 and they assert that, historically, major regional shifts have taken place in terms of the location of higher-value production processes and skilled labour.Footnote 97
A future step might involve connecting such studies on the movement of labour and labour relations along commodity chains, and asserting the similarities and differences per commodity.Footnote 98 In undertaking such an endeavour, global labour historians may want to follow what Van der Linden and Lucassen have baptized “the collective model”,Footnote 99 which leads me to my third and final empirical strategy for “doing” GLH. Research projects following this collective model aim to bring together expertise on labour history from all over the world in order to present truly systematic comparative labour histories. In the first stage of the project, regional experts are asked to write papers based on a systematic framework of comparable research issues and questions, and in the second stage comparative papers are written on specific themes that have been selected as important from the regional papers and the secondary literature. Over the past fifteen years, several such projects have been organized around dockworkers, textile workers, and sex workers.Footnote 100 Bringing together the results of such sectoral studies, for instance by placing them within the framework of the “big data” gathered in the “Collab” project on global labour relations, would really advance our theoretical and empirical understanding of shifts in these labour relations over past centuries, and might simultaneously enable us to introduce more historically grounded generalizations about the importance of labour, and in particular of workers’ varieties of labour relations, into economic history.
Conclusion
This article aims to encourage labour historians to engage more actively in ongoing debates in economic history, and to apply and contribute to economic theory. It is thus a plea to pursue a more ambitious research agenda, without losing sight of detail and nuance. There are many ways in which labour and labour relations have been a crucial explanatory variable in the historical development of social and economic inequality, and labour historians are excellently geared to demonstrate this. Firstly, they are capable of providing fine-grained (often, but not exclusively, qualitative) historical analyses that can complement and refine the more sweeping but often less historically precise statements of many economists and economic historians, who, in their regression analyses, tend to compress time and make rigid assumptions about the functioning of labour markets. Secondly, GLH has shown that the development of capitalism has not led to a unilinear move towards wage labour, and that a variety of labour relations have been, and are, in place. This may lead to a totally different understanding of what have historically been the underlying mechanisms driving economic growth. Thirdly, global labour historians have a rich tradition of working collectively on particular themes and topics, which can be explored further and even more comparatively by linking up more explicitly to economic theory and recent debates in economic history.
One result of such a collaborative project has been the global team effort to collect and make sense of data on labour relations worldwide since 1500. The integration and linkage of this “Collab” database with other datasets all over the world, for example on human development, economic inequality, and demography, would constitute a huge contribution to the field of economic history. It would, for instance, be a tremendous advance to be able to link the available information on labour relations with our increasing knowledge on comparative wage trends, or, even more relevant, to the growing volume of data being gathered on family income. Another contribution might be to nuance the tendency of economic historians to think in binaries when it comes to categories of free and unfree labour. But as much as GLH has to offer economic history, it can also learn from it, in the sense that its theories and hypotheses may be highly inspirational, as well as challenging to nuance or reject. Moreover, its debates – whether relating to drivers of economic development, processes of divergence, or the role of institutions – force labour historians not only to think of labour and labour relations as variables interesting to explain in themselves, but also to consider their wider explanatory power for historical economic development and global inequality.
