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.

Recent studies of European agricultural history have shown that, during the early phases of economic development, agricultural growth can occur in the absence of major institutional changes. This article extends such a conclusion – of agricultural growth without major institutional change – to the case of Portugal during the period from 1850 to 1950. Based on new indices for agricultural output growth and data on the use of inputs, we show in this article that Portuguese agriculture was not stagnant in that century and that output and labour productivity expanded rapidly, in particular in the decades from 1870–1900 and 1930–50. We propose an explanation for the positive performance of the agricultural sector which is related to the changing patterns in the use of land and in the product mix, and to the growth of domestic demand for agricultural produce.

The study of economic growth is arguably the central object of economic history. Our most comprehensive measure of economic growth relies on historical national accounts (HNA). The theoretical underpinnings of present day national accounts have evolved since the first attempts by Gregory King in the seventeenth century and have now become standardised according to the rules of the UN's system of national accounts (SNA). Though grounded in economic theory the SNA system rests in many cases on quite arbitrary definitions that are far from obvious or involve theoretical inconsistencies, as has been pointed out for example by Eisner (1988) and Shaikh and Tonak (1994). This arbitrariness concerns such issues as how to draw the boundary between economically productive activities and forms of private and social consumption, how to account for non-marketed economic activities and how to handle the ‘services’ provided by durable goods.

The 1826 Banking Copartnership Act allowed unlimited liability joint stock banks to form freely for the first time. Such banks were criticised by Walter Bagehot because he believed that impecunious individuals would own their shares. As the 1826 Act crucially contained a post-sale-extended liability restriction, Bagehot's view reduces to whether or not this restriction was effective. This article tests the effectiveness of this restriction by using a simple finance model to measure the risk of the shares of limited and unlimited banks, which traded concurrently during our sample period. Using share price data from 1873 to 1888, obtained from the Investor's Monthly Manual, our results indicate that the perceived risk of the unlimited liability banks was greater, and after the general move to limited liability in 1879, perceived risk fell. Furthermore, we also find that, after controlling for size, the unlimited liability banks tended to have a smaller number of shareholders and stickier share prices.

The evolution of the welfare state in the twentieth century has changed local public finance considerably. This article investigates determinants of local public spending in Norway since the 1930s with an emphasis on the fiscal year 1934–35. We document huge variation in local government spending in 1934–35. The disparities initiated several reforms in the 1930s with the aim of reducing the inequality. The changes in regional policy over time are illustrated by correlation coefficients between municipal spending and private income. The correlation is strongly positive in 1934–35, but is reduced over time, and has been negative since the 1970s. We find that the variation in spending between local governments is reduced over time mainly for two reasons. First, while the elasticity of municipal spending with respect to private income is fairly constant over time, the variation in private income has become smaller. Second, grants from the central government have become a larger part of the local governments' budgets and are to an increasing degree used for redistributional purposes.