Jonas Ljungberg

Professor emeritus

Machinery prices during the second Industrial revolution : An international comparison of capital goods, 1850 – 1939

Author

Cristian Ducoing
Jonas Ljungberg

Summary, in English

Machinery prices are a crucial part of the history of catching up, technological progress and the industrial revolution diffusion. However, the efforts to obtain an international price for capital goods have been scattered and the majority of the works dealing with this phenomena had a national scope mainly . In this paper, the authors have done an effort to homogenise the different national machinery prices available for the period 1850 – 1939, considering three European countries (Great Britain, Sweden and Germany) and five American countries (USA, Argentina, Chile, Brazil and Mexico). The research value of these countries is the mix between producers and buyers, allowing us to understand the cost to implement new technologies in the core economies and the periphery.

The paper is also related to the discussion whether prices of comparable tradables differ between countries. The findings suggest that they may do so and over periods extending over more than a decade. The textbook case does not allow such slow adjustments of prices in tradable goods. However, friction is a phenomenon of real life and in an economic context this does mean that adjustments to change take time. With technological change production functions change and prices do not adapt immediately into an international equilibrium. Summing up, this paper will contribute with empiric results to the debate on the technological diffusion in the so called “Second industrial revolution” period.

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