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The aim is to investigate the influence of trade integration on profit rates across capitalist economies during 1870–1913.

An unequal equalization: understanding the response of rates of profit during the first age of globalization (1870–1913)

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The aim is to investigate the influence of trade integration on profit rates across capitalist economies during 1870–1913.
Analyzed data from seven capitalist economies between 1870 and 1913.
Utilized net productive capital stock and two independent instrumental variable strategies.
Employed climate uncertainty shocks and steamship revolution as instruments.
A 1% increase in trade openness raised the net rate of profit by 0.30–0.33 percentage points.
The effect primarily operates through exports, while imports are statistically insignificant.
Observed β-convergence in profit rates with a half-life of 25–36 years.

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This article examines how trade integration impacts profit rates in seven capitalist economies, suggesting economic implications.

K. C. Bora (2026) studied this question.

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