The transformation of labor supply in the pre-industrial world

In pre-industrial economies labor supply curves bent backwards at very low levels of income. This changed in England before the industrial revolution (De Vries, 1994, De Vries, 2008 and Voth, 1998). Using a model of labor supply where consumption takes time, this paper shows that both an increase in the cost of subsistence and a fall in the price of time-intensive consumption could have generated an increase in hours worked but that only the latter would lead to an increase in the elasticity of labor supply. This model clarifies the role played by consumption in the behavior of labor on the eve of the onset of modern economic growth, distinguishing between an increase in hours worked caused by changing patterns of demand [the case of England] and an increase in hours worked caused by involution [the case of Italy and possibly Japan].

► In pre-industrial economies labor supply curves bent backwards at very low levels of income. This changed in England before the industrial revolution: total working hours increased.
► The principal contribution of the paper is to show that the concept of an industrious revolution can be micro-founded in a model of labor supply.
► The model is used to show that the industrious revolution in England was qualitatively different from that experienced in other countries