Working Paper: NBER ID: w11754
Authors: Trevon D. Logan
Abstract: According to conventional income measures, nineteenth century American and British industrial workers were two to four times as wealthy as poor people in developing countries today. Surprisingly, however, today's poor are less hungry than yesterday's wealthy industrial workers. I estimate the demand for calories of American and British industrial workers using the 1888 Cost of Living Survey and find that the estimated calorie elasticities for both American and British households are greater than calorie elasticity estimates for households in present day developing countries. The results are robust to measurement error, unreported food consumption, and indirect estimation bias. This finding implies substantial nutritional improvements among the poor in the twentieth century. Using the Engel curve implied by the historical calorie elasticities, I derive new income estimates for developing countries which yield income estimates that are six to ten times greater than those derived using purchasing power parity or GDP deflators.
Keywords: No keywords provided
JEL Codes: D12; I12; I31; J10; N31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| historical calorie elasticities for American and British households (D12) | calorie demand in developing countries (O15) |
| income (E25) | calorie demand (D12) |
| historical wealth (N21) | nutritional demand (R22) |
| calorie elasticities in late nineteenth-century (D12) | nutritional wellbeing (I31) |
| Engel curve estimates (C51) | income estimates for developing countries (O55) |