Rodney Edvinsson

A CONSUMER PRICE INDEX FOR SWEDEN, 1290–2008

This paper presents a Consumer Price Index for Sweden 1290–2008. Constructing an index that covers more than seven centuries poses conceptual and empirical problems, and demands some methodological innovations. For example, during numerous occasions the currency unit was changed, and in some periods multiple currencies were used at floating exchange rates relative to each other. This paper also presents two different price indices, one that mainly serves the purposes of estimating real prices and real wages, and another that provides a measure of inflation. While the former follows the main currency unit, the latter also takes into account that debased coins were devalued during recoinage.

Swedish Harvests, 1665–1820: Early Modern Growth in the Periphery of European Economy

Abstract Today, one of the greatest challenges facing macroeconomic history is to quantify economic growth in the early modern period. This article presents and discusses a series of total and per capita harvest production in Sweden within present borders for the period 1665–1820. The series is based on three main indices: grain prices, subjective harvest assessments and tithes. Various sources of harvests are more reliable as indicators of relative changes than of absolute levels. For example, tithes probably only taxed between 15 and 60 per cent of the actual harvests, but seem to capture annual harvest fluctuations reasonably well. To estimate the absolute level of per capita harvests, the index of the per capita harvest production is linked to data for the early nineteenth century, which are more reliable. The article argues that harvests stagnated during the studied period, which is in line with several other studies for various European countries. The annual fluctuations were substantial.

New annual estimates of Swedish GDP, 1800-2010

Although the historical national accounts of Sweden are among the most detailed in the world, there is scope for improvement. This study revises previous historical estimates of Swedish GDP. Agricultural output is upgraded for the nineteenth century following recent research by Swedish agrarian historians on the underestimation of official statistics. Estimates of annual fluctuations before 1861 are significantly improved by using new sources on yield ratios of harvests. For manufacturing, home industries are added, in accordance with modern international guidelines (2008 SNA). The study concludes that early nineteenth-century Sweden was not as poor relative to other West European countries as previously thought.

A Tendency for the Rate of Profit to Fall? From Primitive to Flexible Accumulation in Sweden 1800-2005:

Using Swedish historical national accounts, this paper shows that, up to the 1970s, there has been a secular rise in the national capital/output ratio and a secular fall in the rate of exploitation, which tended to depress the profit rate. In Sweden, the nominal capital/output ratio increased fastest during the transition from primitive to accelerated accumulation in the 19th century. Since the 1970s, these secular trends have been reversed, which is connected to flexible accumulation that slims down the inventory stock to a minimum and destroys old consensus between capital and labor. JEL classification:B51, E11, N13, N14

Prices and the growth of the knowledge economy in Sweden and Western Europe before the industrial revolution

Abstract This article uses long-term series of real prices for various goods and services to analyse the evolution of the knowledge economy before the Industrial Revolution by focusing on Sweden in comparison with other European countries. During the early modern period, the relative price of knowledge-intensive goods and services, such as iron, paper, salt, sea transports and silver, decreased relative to a Consumer Price Index. The increased productivity levels of these goods and services were caused by increased division of labour and accelerated diffusion of knowledge. However, the real price of foodstuff tended to increase, implying that living standards declined with increased population. Early modern Western Europe acquired a peculiar price structure, characterized by low prices of industrial goods relative to the price of food. Only with the advent of industrial society could the knowledge economy escape the Malthusian entrapment.

Inflation before paper money: debasement cycles in Sweden–Finland 1350–1594

Abstract Although high inflation is associated with the spread of paper monies, rapid price increases are well known under the metallic standard from several countries, caused by the debasement of coins. The exact mechanism is still a puzzle. If agents were rational, why did they accept inferior coins at par with better ones? This paper compares five debasement cycles that occurred in Sweden–Finland 1350–1594. During the initial phase of such cycles coins tended to circulate by-tale, while by-weight circulation was most common towards the end of the cycles. A premium on the heavier coins implied that they were not driven out of circulation. The seignorage rate was significant during the initial phases of the cycles, while it decreased when prices and exchange rates adjusted in response to the debasement, prompting a recoinage, when the monetary unit was strengthened. It is this shift from by-tale to by-weight circulation that explains the high inflation rates that could occur before the rise of paper money.

Shadow interest rates in Stockholm and the integration of early financial markets, 1660–1685: was Heckscher right?

The decline of interest rates during the early modern period is considered an important factor in the subsequent rise of capitalist society. This article uses unique empirical material based on bills of exchange in Stockholm between 1660 and 1685 to estimate underlying ‘shadow interest rates’. It shows that annual rates ‘according’ to Stockholm were very high, mostly above 10 per cent, an indication of underdeveloped financial integration between Stockholm and the main European centres. There are also indications of a decline in these rates during the period studied, reflecting improved efficiency in Swedish financial markets.

Testing the demand approach to reconstruct pre-industrial agricultural output

ABSTRACT A common method to reconstruct historical national accounts is the demand approach, which calculates agricultural consumption from the development of wages and prices of agricultural and non-agricultural products assuming constant income, own price and cross price elasticities of demand. This study uses agricultural data for Sweden 1802–1950, which is more reliable than for other countries, to put the approach to test. Time series analysis shows that the demand approach could be modelled as a cointegrating relationship between per capita demand and the deflated wage. Income elasticity is estimated to +0.4. Using the estimated parameters to extrapolate Swedish agricultural consumption back to the Middle Ages accords quite well with other indicators. However, out-of-sampling shows that the 90% confidence interval is as large as ±0.15–0.25 natural logarithms.

Major Recessions in Sweden 1850–2000: from pre-capitalist to modern types of crises

This article uses historical national accounts to compare major recessions in Sweden from 1850 to 2000. A major recession is defined as an event when the Gross Domestic Product (GDP) in one year is below the level two years earlier. The sharpest declines in GDP coincided with the World Wars, crop failures and contractionary economic policies. One important distinction to be made is between pre-capitalist and modern types of crises. While the former were crises of underproduction, brought about by declines in agriculture and consumption, the latter were overproduction crises usually generated by declines in investment and industrial production. The article shows that in Sweden the transition from the one type to the other was a prolonged process.

Assessing trade in the mercantilist era: evidence from a new database on foreign trade of Sweden – Finland, 1738–1805

ABSTRACT This paper presents a newly constructed database on foreign trade of Sweden–Finland 1738–1805, consisting of all exports and imports that were recorded by the custom houses in this period, and is made available at www.historia.se/Swedish foreign trade 1738_1805.xlsx. The traditional view as presented by Eli Heckscher, who was very critical of the mercantilist policies of the time, was that the overseas trade of Sweden-Finland saw a trend of secular stagnation during the course of the eighteenth century. By contrast, we show that in conjunction with a substantial expansion of the population, total trade nearly increased twofold during the period of study. Despite that, there was a small decrease in the value of exports in relation to GDP, mostly explained by a drop in the relative price of bar iron. The degree of specialisation of Swedish exports saw a declining tendency in this period. While exports from Sweden had a higher degree of specialisation than Finnish exports, imported goods to Finland were more concentrated than Swedish imports. Lastly, the composition of imports did not markedly alter, meaning that a consumer revolution did not take place in either Sweden or Finland.