The Economic History Review

Unskilled wage gaps within the Japanese Empire

Volume 68 Issue 1
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Pages: 23-47Authors: Myung Soo Cha
Published online: August 7, 2014DOI: 10.1111/ehr.12053

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This study calculates the cost of subsistence and respectability consumption baskets to derive ‘welfare ratios’ for 11 cities in the Japanese Empire as defined by Allen and his colleagues. Nominal wages tended to be higher where higher prices prevailed, and vice versa. Prices and nominal wages remained highest in Japan and lowest in Manchuria, with Korea and Taiwan being placed in between. Welfare ratios remained roughly comparable in the 1910s in the imperial cities outside Manchuria, where unskilled workers enjoyed substantially higher living standards. Interwar decades saw real wages rise in Tokyo, but fall in Dalian, which caused convergence in workers’ income levels. Wage divergence occurred within Manchuria, as workers in Shenyang and Changchun enjoyed an improving welfare ratio. Real wages rose more slowly in Korean and Taiwanese than in Japanese cities. Replacing a subsistence lifestyle with a ‘respectable’ lifestyle yields a significantly different picture of the evolution of the real wage gap within the empire, which contradicts findings reported by existing studies in important respects.