Living Standards in the Premodern Period: A New Methodology for Rural Market and Subsistence Economies

Abstract

In light of developments in economics, historians have turned to multidimensional indicators of living standards to measure prosperity. However, finding the best methodology has remained a challenge. In this paper, we aim to introduce a new approach to address two crucial issues: measuring premodern living standards in both market and non-market economies, and accounting for the societal and distributive aspects of living standards. In the premodern period, most societies were not market economies. Relying on real wages and GDP reconstructions in a multidimensional index, therefore, becomes problematic. To address this issue, we propose including sources of income such as subsistence farming, cottage industry, and (part-time) wages. Our final methodological innovation was to move beyond a simple societal average by dividing the population into quartiles and calculating a separate index for each. This approach allows for a more nuanced, stratified analysis of welfare distribution – a step rarely taken in historical studies. We selected two case studies from rural Piedmont/Italy (between 1650 to 1800) to test our methodology: one typical premodern rural market economy (Vercelli region) and one representative of subsistence economies (Susa region). The results of our analysis show that the emerging picture of living standards is not uniform in trends or values, but rather resembles a collage of different experiences. The two societies diverged in both economic and non-economic material living standards, and so did each social group.