Coercive Contract Enforcement: Law and the Labor Market in 19th Century Industrial Britain / Suresh Naidu, Noam Yuchtman.

Format:

Book

Author/Creator:

Naidu, Suresh.

Contributor:

National Bureau of Economic Research.

Yuchtman, Noam.

Series:

Working Paper Series (National Bureau of Economic Research) no. w17051.

NBER working paper series no. w17051

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Coercive Contract Enforcement

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2011.

Summary:

British Master and Servant law made employee contract breach a criminal offense until 1875. We develop a contracting model generating equilibrium contract breach and prosecutions, then exploit exogenous changes in output prices to examine the effects of labor demand shocks on prosecutions. Positive shocks in the textile, iron, and coal industries increased prosecutions. Following the abolition of criminal sanctions, wages differentially rose in counties that had experienced more prosecutions, and wages responded more to labor demand shocks. Coercive contract enforcement was applied in industrial Britain; restricted mobility allowed workers to commit to risk-sharing contracts with lower, but less volatile, wages.

Notes:

Print version record

May 2011.