Collaborative Research: Ownership and Technology Adoption: Evidence from the Census of Manufactures

Productivity growth is a fundamental driver of increased living standards, and this project explores sources of manufacturing productivity growth as the United States rose to global economic prominence. The researchers seeks to understand firms technology adoption decisions during a past period of rapid technical change. There is a great deal of current policy discussion surrounding technology adoption, both in the United States and worldwide. The rapid pace of technological change naturally raises questions about how firms are able to adapt to changing environments. The historical experiences associated with the development of the American economy inform our understanding of the underlying sources of sustained long-run economic growth, which provides an historical benchmark for comparison and contrast with the modern era. The researchers preliminary estimates highlight the importance of ownership for firm behavior and outcomes. In milling, changes in ownership are associated with a substantial increase in the likelihood of firms upgrading from water power to steam power. Across all of manufacturing, female owners are more likely to own smaller establishments, but employ more women (and pay them more). The importance of ownership highlights how unequal access to funds and new technologies can be a driver of inequality. The researchers also explore how access to markets affected firm dynamics, as an expanding railroad network increased market integration.

The main objective of this project is to compile a new open-access panel database of US manufacturing establishments from existing Census administrative records. The researchers have trained a team to digitize images of the handwritten Census manuscript pages and make panel links from one decade to the next. Through this project, the research team will complete these panel links, across all industries, and make the database easily accessible and freely available. The US Census of Manufactures is an establishment-level government census of all manufacturing establishments above a minimal size. The Census of Manufactures was professionalized and comprehensive beginning in 1850, and Census enumeration was done in-person by US Marshals. By making available new data on every manufacturing establishment, linked over time, this project enables further research into the historical development of the American economy. This database allows researchers and policymakers to understand better the underlying drivers of economic growth and improvements in living standards.