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Locating coal seams, digging it out of the ground and transporting it to its markets are complex activities. The demographic changes were similarly driven in part by variables that depended on useful knowledge. The rise in the rate of return to human capital and the rising effectiveness of contraceptive technology both belong to that category. If we are to search for a clue as to what really made the difference, we should look at what people knew, who knew what was known, how others had access to it, and how knowledge expanded both in terms of more being known and in terms of making what was known more accessible.
Moreover, recent attempts to improve our estimates of the inputs that went into the production function seem to indicate that those estimates are still too conservative. For instance, if Voth is correct about people working longer hours and the quantitative importance of the decline of St Monday (see p. 277), labour inputs estimated from population data underestimate labour inputs and thus overestimate productivity growth. Clark (2001b) has re-examined the housing and real estate market, always one of the weakest links in the computation of the income accounts, and discovered that the property income estimates based on the property tax of 1803 seriously underassessed the value of land and houses, and as a result the rise of this component of income in the following decades is seriously overstated.
It also seems plausible, as some economists have argued (Galor and Weil 2000; Galor and Moav 2002; Lucas 2002) that profound changes in demographic behaviour were driven by changes in the desired number of children. The logic here is based on a growth in the return to human capital, which makes it more attractive to have fewer children but invest more in their education. The eventual result was a sharp decline in fertility rates, driving up per capita income. Moreover, classical models inspired by Malthusian thinking implicitly assumed closed economies.