American colonial incomes, 1650–1774

New data now allow conjectures on the levels of real and nominal incomes in the 13 A merican colonies. N ew E ngland was the poorest region, and the S outh was the richest. Colonial per capita incomes rose only very slowly if at all, for five reasons: productivity growth was slow; population in the low‐income (but subsistence‐plus) frontier grew much faster than that in the high‐income coastal settlements; child dependency rates were high and probably even rising; the terms of trade were extremely volatile, presumably suppressing investment in export sectors; and the terms of trade rose very slowly, if at all, in the N orth, although faster in the S outh. All of this checked the growth of colony‐wide per capita income after a seventeenth‐century boom. The A merican colonies led G reat B ritain in purchasing power per capita from 1700, and possibly from 1650, until 1774, even counting slaves in the population. That is, average purchasing power in A merica led B ritain early, when A mericans were B ritish. The common view that A merican per capita income did not overtake that of B ritain until the start of the twentieth century appears to be off the mark by two centuries or more.