By the middle of the 19th century, aggregate real wages were rising in the US and UK. Yet despite increased demand for their services, unskilled workers do not seem to have shared in this pay rise. Higher demand for their services was more than matched by increased supply, both from child labour and from displaced artisans as they moved down the skill spectrum (Clark (2010)). As a result, their pay appears to have flat-lined. At the high-skill end, the supply of workers was also increasing as some workers skilled-up (Clark (2010), Wallis (2014)). Despite that, there is evidence the skill premium for clerks and other professionals rose through the 19th century. The net effect of these complex shifts was thus to widen the distribution of wages between skilled and unskilled workers (Katz and Margo (2013)). Income inequality rose. The pattern of labour’s share of the national income is also interesting. This appears to have fallen in the first part of the 19th century (Allen (2009)), as Chart 21 illustrates. Workers do not appear to have enjoyed the early fruits of the Industrial Revolution. That perhaps explains why David Ricardo entered the fray at this time. In the event, these concerns proved ephemeral. With a lag, the rising tide of productivity and incomes lifted all boats, whatever their level of skill. Inequalities in wages started shrinking and labour’s share of income began to rise, returning to their levels at the end of the 18th century.
Jarle Bergo: Inflation targeting in a small open economy Address by Mr Jarle Bergo, Deputy Governor of Norges Bank, at the General Meeting of ACI Norge on 31 August 2001. *  *  *  The overview of the economic situation is based on the assessments from Norges Bank's monetary policy meeting on 8 August. Introduction First of all allow me to thank you for the opportunity to provide this address on Norwegian monetary policy. Since Governor Gjedrem was here one year ago, the Central Bank of Norway has been given new guidelines, and I therefore find it natural to start by providing an account of the new mandate for monetary policy. I will then talk about the implementation of monetary policy, with a closer look at the role of the krone exchange rate. I would also like to address the topic of the evaluation and transparency of monetary policy, before concluding with a discussion of the basis for interest-rate setting and the current economic situation. New mandate  This spring, the Government and the Storting (Norwegian parliament) adopted new guidelines for economic policy. The Government has announced that it will use the expected real return on the Government Petroleum Fund over the central government budget. The Government estimates that the guideline implies an average annual increase in the use of petroleum revenues over the central government budget of about 0.4 per cent of mainland GDP in the years between 2002 and 2010.