Mexico’s Real Wages in the Age of the Great Divergence, 1730-1930

This study builds the first internationally comparable index of real wages for Mexico City bridging the eighteenth and the early twentieth century. Real wages started out in relatively high international levels in the mid eighteenth century, but declined from the late 1770s on, with some partial and temporal rebounds after the 1810s. After the 1860s real wages recovered and eventually reached eighteenth-century levels in the early twentieth century. Real wages of Mexico City’s workers slid behind those of high-wage economies to converge with the lower fringes of middle-wage economies. The age of the global great divergence was Mexico’s own age of stagnation and decline relative to the world economy