European economic integration and the labour compact, 1850-1913

Bibliographic Data

ID23133035
AuthorsMichael Huberman (Center for Interuniversity Research and Analysis on Organizations), Wayne Lewchuk (0000-0003-4070-6895, McMaster University)
Year2003
Volume7
Issue1
Pages3-41
Publication date2003-04-01
Peer ReviewedYes
Open AccessNo
TypeARTICLE
VenueEuropean Review of Economic History (JOURNAL)
Journal identifiersISSN: 1361-4916 • E-ISSN: 1474-0044
PublisherOxford University Press (OUP) (PUBLISHER)
DOI10.1017/s1361491603000017
OpenAlexW1995722389
LanguageEN
Citations received21
References cited25

Globalisation was a fact of life in Europe before 1913, but as trade shares increased, so did wage and employment instability. Faced by growing pressure from workers, national authorities established labour compacts — a packet of labour market regulations and social insurance programmes — that defended workers against the risks they faced in and outside the factory. The labour compact provided workers with insurance because it compressed wage structures. We construct an index of labour market regulations and social insurance schemes for seventeen European countries and find that the extent of the labour compact varied with the level of openness. We conclude that the labour compact gave workers reason to support free trade because it protected them from external risk. Contrary to the received view, globalisation before 1913 was compatible with state intervention. Our findings are consistent with Rodrik's and Agell's for the period after 1945.

Economics · Factory (object-oriented programming) · Globalization · Immigration · Intervention (counseling) · Labour economics · Market economy · Openness to experience · Political science · Social insurance · Wage · Employment and Welfare Studies · Social Policy and Reform Studies · Taxation and Compliance Studies