Economics Research Institute Study Paper
Utah State University Department of Economics
Careful studies of the distribution of income in nineteenth-century United States have been hampered by a paucity of available data. This study undertakes the analysis of factors influencing the distribution of personal income in communities in the Great Basin region of the western United States for the years 1860-61 and 1870. The study utilizes estimates of full income by individual based on information contained in the General Economic Records of the Church of Jesus Christ of Latter-day Saints, demographic and economic data from the manuscript censuses of 1860 and 1870, and other relevant data from contemporary sources. Mean income and Gini ratios are calculated for nearly all Great Basin communities, and econometric analysis is undertaken to identify the impact on income distribution of changes in mean income, community size, crop destruction by grasshoppers, and the percentage of the population born in non-English speaking countries. The econometric results are compared to the results of an earlier study that looked at factors influencing income inequality for the Great Basin as a whole over the period 1855-1900. Of particular interest is the impact of ethnic mix on relative income inequality. While the earlier study found that Gini ratios for the Great Basin region rose as the fraction of the population born in non-English speaking countries increased, the current study finds that Gini ratios first rose, then fell as the percentage of the community born in non-English speaking countries rose. At the territorial level, grasshopper infestation increased relative inequality, but at the community level it decreased inequality. The completion of the transcontinental railroad allowed a few individuals in urban communities to earn large incomes in capital-intensive activities, increasing community income inequality, ceteris paribus, but community access to the railroad had a leveling effect on labor income and product prices, reducing community income inequality.
Israelsen, Karl E. and Israelsen, L. Dwight, "Nativity and Income Distribution in Frontier Utah Communities" (2000). Economic Research Institute Study Papers. Paper 179.