Labour Scarcity and Productivity: Insights from the Last Nordic Plague
This paper studies the relationship between labour scarcity and productivity in the context of a 1710s plague outbreak. While higher wages should have led to an export contraction, exports grew after plagued regions shifted into capital-intensive production. Using a Ricardian model, I show that productivity growth in capital-intensive sectors is best suited to explain this export boom. I argue that labour scarcity incentivises capital-intensive production which raises productivity growth.
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This page was last updated on 14 March 2025
