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Between 1850 and 1880, capital per worker in United States manufacturing increased on average by at least 75 per cent, even after taking account of declining capital goods prices. During this same period, production shifted from small, labour-intensive artisan shops to large capital-intensive factories. Similar changes have occurred in many other countries at the same stage of industrialization. Establishment-level data from the federal censuses of manufacturing, however, reveal that the shift in production in the United States accounts for a modest amount of the increased capital per worker. There, at least, capital deepening seems to have occurred in almost all firms everywhere.