Post on 07-Jan-2023
Real Income in Belgrade in the Long Nineteenth
Century, 1805 - 1908.
by Aleksa I. Jorga∗
Ultimate revision December 2011.
Abstract
The research collected a number of archival sources to present, for the �rst time,
nominal wages and prices series for Belgrade. Constructing three consumer bundles, it
examined the behavior of real income in Belgrade, establishing for the �rst time a skill
mapping for skilled and unskilled labor, the administrative, military and education
sta� as well as skilled masons, mowers and ploughers and unskilled day laborers. The
research also establised a structural link between the movement of less-skilled labor
(mason, laborer) and prices. The research was able to establish that the real income in
Belgrade followed the trend in Istanbul, failing to converge to rates of growth seed in
Northeast Europe. Given the politically mandated institutional change, the empirical
evidence seems to indicate the classic Ottoman (Islamic) institutions were not the
cause of the absence of convergence. Rather, centrally mandated, wholesale economic
(and social) transformation replacing Ottoman with perceived Western institutions
failed to produce a comparable rate of growth of real income.
Keywords: Belgrade, real income, nominal wage, inistitutional change, urban develop-
ment, Ottoman economic history
JEL Classi�cation: I30, J31, N33, O18
∗In partial full�llment of a requirement of the Master of Science degree. The author wouldlike to thank his advisor, Prof. Tomas E. Murphy for guidance and advice as well as his familyfor its support. Additional thank-you goes to sta� at Archives of Belgrade and Archives ofSerbia for help with �nding and assessing the original materials. A further special thank youis in order to Milo² Jovanovi¢, of the University of Illionis in Urbana-Champaign, and NevenaGojkovi¢, of the Jagielonski Univerisity in Krakow, for sharing their research on urban changein Belgrade and inter-religious relationships, respectively.
1
Real Income in Belgrade in the Long Nineteenth Century 2
Contents
1 Introduction. 5
1.1 Real income as a measure of well-being. . . . . . . . . . . . . . . 5
1.2 Institutional considerations in the choice of Belgrade. Change in
population. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2 Motivation. Review of prior e�orts. 9
2.1 The Great Divergence and Istanbul. . . . . . . . . . . . . . . . . 10
2.2 Belgrade: heterogeneity of money and power. . . . . . . . . . . . 12
2.3 Serbia and Istanbul. . . . . . . . . . . . . . . . . . . . . . . . . . 13
3 Data Description 16
3.1 The collected information on Belgrade. . . . . . . . . . . . . . . . 16
3.2 Constructing the bundle: is it a good a measure of a standard of
living? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.3 Constructing the bundles: composition for Belgrade. . . . . . . . 19
3.4 Wages and salaries in the Ottoman universe. . . . . . . . . . . . 23
4 Formal analysis of data. 26
4.1 Twin divergence. The Ottoman drift. . . . . . . . . . . . . . . . 26
4.2 High-skilled income in Belgrade. Administrative and judicial sta�. 28
4.3 High-skilled income in Belgrade and gender. . . . . . . . . . . . . 29
4.4 Narrow band. Time series analysis. . . . . . . . . . . . . . . . . . 31
4.5 Indices composition and drivers of change. . . . . . . . . . . . . . 35
4.6 Temporal aggregation. Monthly data in formal analysis. . . . . . 40
4.7 The signi�cance of central political authority in evaluating real
income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
4.8 Real income as proxy of output growth. . . . . . . . . . . . . . . 43
Real Income in Belgrade in the Long Nineteenth Century 3
5 Conclusion. Failure of mandated institutional change. 45
6 Complete data 48
6.1 Narrow band. Price lists and unskilled wages. . . . . . . . . . . . 48
7 References 48
7.1 Primary sources . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
7.1.1 Archives of Belgrade (AB), Governmnet of the City of
Belgrade (UGB) collection. . . . . . . . . . . . . . . . . . 48
7.1.2 Archives of Serbia, O�ce of the Prince (KK) and Ministry
of Education (Mps) . . . . . . . . . . . . . . . . . . . . . 48
7.1.3 Archives of Serbia, Law Collection (LC; Zbirka Zakona,
ZZ). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
7.1.4 Archives of Serbia, printed material: . . . . . . . . . . . . 51
7.1.5 Archives of Serbian Academy of Sciences and Arts: . . . . 51
7.2 Secondary sources. . . . . . . . . . . . . . . . . . . . . . . . . . . 51
A Chronology of Political Events. 55
B Metric conversion table of units 58
List of Figures
1 Population of Belgrade, circa 1800 to 1914. . . . . . . . . . . . . 8
2 Price indices 1843 � 1905. . . . . . . . . . . . . . . . . . . . . . . 22
3 Urban wages monthly series, annualized. 1860 to 1905. Clock-
wise from top: (1) Mason welfare ratios, CPI; (2) Laborer welfare
ratios, CPI; (3) Laborer welfare ratios, SOL; (4) Mason welfare
ratios, SOL. Source: collected original data for Belgrade (see Appendix). . . . 32
Real Income in Belgrade in the Long Nineteenth Century 4
4 Rural wages monthly series, annualized. 1860 to 1905. Clockwise
from top: (1) Mower welfare ratios, CPI; (2) Mower welfare ra-
tios, CPI; (3) Plougher welfare ratios, SOL; (4) Plougher welfare
ratios, SOL. Source: collected original data for Belgrade (see Appendix). . . . 33
5 Seasonality in pork prices. Evidence for pre-refrigeration �hog cy-
cle�. Source: collected original data for Belgrade (see Appendix). . . . . . . . 36
6 Bread prices. Possible evidence of institutional moderation. Source:
collected original data for Belgrade (see Appendix). . . . . . . . . . . . . . 37
7 Seasonality in wine prices. Evidence of explosive trend. Source:
collected original data for Belgrade (see Appendix). . . . . . . . . . . . . . 38
8 Monthly in�ation as change in CPI, 1860-1905. Source: collected orig-
inal data for Belgrade (see Appendix). . . . . . . . . . . . . . . . . . . . 40
List of Tables
1 Industrial s tandards for agricultural products, 1898. . . . . . . . 19
3 Comparison of bundles, Allen and SOL (Belgrade). . . . . . . . . 20
4 Nominal wages in grams of silver, select cities, 1650 to 1914. . . 27
Real Income in Belgrade in the Long Nineteenth Century 5
1 Introduction.
"We hear from our elderly that during their youth 200-300 dou-
cats was once allowing for a luxiorous living, while it is today, in
Belgrade, barely enough for comfort. They say that bread used to
be 12 paras per okka, meat 14, but we should ask them how much
bread and meat could they then earn, and we shall be convinced. . .
that we enjoy the same produce, and of better quality, than when
food was cheap, but money was expensive1."
� Kosta Jovanovi¢, 1860.
1.1 Real income as a measure of well-being.
Measuring how well you are doing is a di�cult task. One way to do it is to look
for how much you can buy with the money you earn. This basic setup has been
the core of many recent e�orts in economic history. To gather, evaluate and
publish real income series is understood as the principal way to �nd out what
was the standard of living of individuals, and, by extension, economies. The
earlier the research period, the more di�cult it is to establish the nominal gross
domestic product of a national economy, still less gauge purchasing power parity
per capita. In its stead, urban real wages, especially for masons, are taken as a
proxy for the standard of living. In this sense, they are often �the only reliable
piece of information we have for developing economies before 1870, if not 1914�
(Pamuk, 2004: 210). The di�erence in real income is seen as indicating relative
hardship, thus absence of output growth.
Taking after the recent e�orts to establish a comprehensive real income series for
a number of cities, Istanbul included, the research collected prices and nominal
wages for a number of historical occupations, from highly-skilled (ie. requiring
literacy: administrative, educational, judical sta�) to skilled (mason, plougher)
to low-skilled (day laborer). The nominal wages were de�ated using a bundle of
goods centered on a historical bundle �rst used by Allen. Furthermore, taking
advantage of the collected data, a separate, wholesale index was constructed.
In the process, the research established the consumer price index for Belgrade,1Emphasis added.
Real Income in Belgrade in the Long Nineteenth Century 6
compared its �ndings to the rest of Serbia and Istanbul, and formally evaluated
two time series �nding evidence of cointegration. Finally, the research also pro-
posed an insititutional avenue for evaluating its �ndings, taking a look at the
institutional change in the Ottoman and post-Ottoman societies.
The proximate purpose of this research is to establish for the �rst time a quan-
titative measure of real income for Belgrade in the so-called long nineteenth
century, and compare it with other locales, namely, towns within present-day
Serbia and Istanbul. The real income series are derived from monetary wages
de�ated by a bundle of goods. Gathering both unskilled and skilled wages, both
directly state-related and private sector should allow for a formal mapping of
skill level to monetary compensation, indicating total compensation. Generating
a skill to compensaton mapping does give indication to incentive structure of
the economy: would I have made more money as an Ottoman or Serbian o�cial,
as a mason or as a plougher, and how much more than an unskilled laborer? Are
there any institutional restrictions such as religion or gender? In the process,
the reseach was able to conclusively establish parallel movement of real income
in Istanbul and Belgrade, consequently an absence of convergence to Northeast
European rates of growth of real income. The research, did, nevertheless, �nd a
structural relationship between two urban data series it collected, namely mason
and laborer. Ultimately, it also determined the existance of a long term trend
of reduction in rural real income.
1.2 Institutional considerations in the choice of Belgrade.
Change in population.
The choice of Belgrade does not only re�ect a relative lack of data on real
income, but intrinsic institutional importance as well. Belgrade has historically
been an important regional center, for preindustrial manufacture, commerce and
political control of Southeast Europe. A prime Ottoman city, at one time second
only to Istanbul in its size, it o�ers a premier study in strategies of economic de-
velopment. The city underwent a prolonged (1521-1688; 1690-1718; 1730-1867)
experience of Ottoman institutions and their change. Particularly the last of the
periods is of note, as a period of institutional heterogeneity and ensuing com-
petition. Recent literature (e.g. Kuran, 2004, 2011) posits a dichotomy between
Islamic and �Western� economic institutions. While formalization might be mis-
leading, Belgrade o�ers a case study in a conscious political e�ort to abandon
Real Income in Belgrade in the Long Nineteenth Century 7
former for the later. In that, the competition came not only from the emerg-
ing political model of national sovereignty, but indeed from the Westernizing
political order in Istanbul itself.
Moreover, the gradual removal of Ottoman political presence was happening
concurrently with far reaching, mandated, institutional change. The local gov-
ernment introduced a national currency following a continental standard, the
Latin Monetary Union. In the same decade, metricization of weights was man-
dated. Both developments signalled the attempt by political authority at a com-
prehensive institutional westernization. Both the local, emerging Serbian order
and the cental government in Istanbul perceived �modernization� as �Western-
ization�, whereby economic innovation, mandated centrally, would neccesarily
lead to complete transformation, �Westernization�, of informal institutions, e.g.
dress.2 This makes real income in Belgrade doubly important: as an addition to
emerging literature on real income as such, and as a yardstick for strategies of
development.
Indeed, during the long nineteenth century, the city had been in an unusual
situation of hosting two competing centers of political authority while using
upwards of sixteen di�erent currencies. The city hosted competing centers of
political authority (1841-1867), in addition to using some seventeen di�erent
currencies. In addition to these two, the political history of the city was par-
ticularly turbulent, even for a fairly turbulent time: two sieges (1807, 1813),
one bombardment (1862), staging ground for four wars (1876-1877; 1877-1878;
1885-1886; 1912-1913), major riot (1862) and several coups (1843, 1859, 1903)3.
Partially as a consequence, the population of the city �uctuated tremendously
in the entire 1688 - 1815 period. Nevertheless, Belgrade remained a vital eco-
nomic center well above its su�ering population numbers. Regardless of formal
con�ict (sieges in 1688, 1718, 1735, 1807) , city remained the primary source
of supply for species money, a crucial role in the preindustrial, pre-�at money
economy. Measure of market integration and rural development was partially a
function of supply of species, neccesitating a produce exchange in kind. Thus,
the local economy su�ered not only from loss of demand for rural produce (with
population shifts) but also the loss of supply of coinage.4
2Some authors, i.e. Faroqhi (2007) discuss the long Eighteenth century in the Ottomancontext, arguing that it is after c. 1840 that the �reorganization of the whole culture of Ottomanupper class� starts.
3See Appendix 1 for a list of major events in political history of the city4cf. K. Jovanovic quote above: �...when food was cheap but money was expensive�.
Real Income in Belgrade in the Long Nineteenth Century 8
0
80
100
60
40
20
0
popu
latio
n in
thou
sand
s
1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910years
Figure 1: Population of Belgrade, circa 1800 to 1914.
Dramatic change in the city is illustrated by the change (Figure 1) in its popu-
lation, from 50,000 inhabitants in 1572 (cf. Çelebi, as per Milenkovic, 1932: 58)
to an Ottoman peak of 100,000 citizens (ibid). Following a century and a half
of con�ict, the city had as few as 5,000 citizens in the immediate aftermath of
two Serbian uprisings (1815) . Population rose to 24,000 in 1862 just prior to
the departure as many as one third of its population, i.e. most of the Muslim
citizens. At formal political independence in 1878, it had 28,000 citizens. It al-
most tripled in size by 1900 (70,000) and reached just under its Ottoman peak
of 100,000 citizens in 1910.
Urban population as such has sometimes been used as a gauge of output growth,
especially for preindustrial societies with little records other than tax receipts
(Acemoglu, 2003). In this regard, �uctuation of Belgrade population does o�er
a guide to output change. Nonetheless, given the new data introduced here, the
exponential growth of the population better serves to emphasize the institutional
change as a possible narrative for disparity in real income. Namely, the shape of
the population growh curve is equivalent to that of other contemporary cities,
such as London or Vienna. The institutional change as a way to approach formal
analysis is therefore more curious: given similar population trajectories, how
a�ected is real income by institutional heterogeneity?
Real Income in Belgrade in the Long Nineteenth Century 9
2 Motivation. Review of prior e�orts.
The premise of this research rests on historical real income being a good proxy
for standard of living, and a good indicator for institutional change. Other au-
thors have posited a direct, measurable e�ect of social and political shocks on
the standard of living. One example would be Persson (1999), arguing formally
for a causal link between the grain price volatility and both survival expectancy
and urban political stability. The e�ect of change is mediated through measures
of cash market integration of producers and the state of health of urban popu-
lation. While Persson formalizes the theoretical causation, Pamuk (2004) o�ers
empirical evidence. He notes that preindustrial governments could and indeed
did intervene to maintain a price ceiling for basic commodties fearing political
consequences of grain price volatility. The example he uses is narrh, maintaned
through most of the seventeenth century for the capital, Istanbul. The evidence
for mandated price ceiling, had been anecdotal, ie. found in primary sources
from the period. Pamuk, however, in his evaluation of real income �nds for-
mal evidence by way of establishing the price movements for basic staples, and
especially bread.
The formalism of this approach is contrasted with several other authors, who
argue for the paramount importance of institutions. In his comprehensive treat-
ment of the topic (2002: 370) Palairet characterizes economic change in the
region as a �triumph of politics over economic rationality�, a priori postulating
both the neoclassical growth model as well as paramount importance of central
political authority. Palairet uses his model of rational (explicitely Western) eco-
nomic agents to argue for an existance of a "productivity gap between East and
West rural labor� (without relaying comparable data on labor productivity),
explained at least in part by �a culture of laziness� (p.112). Thus the absence of
cash market integration of grain producers is seen as indicating the absence of
formal rationality within economic agents. In both examples, the author accepts
a prori the central role of institutions in economic development, be it formal
(political) or infomal (habits). While the interplay of institutions and techno-
logical change has been a vital issue (e.g. North, 1989) in economic history, the
empirical evidence does not always lends itself to any narrative, let alone a single
one.
The prime empirical evidence sought for the argument for the paramount im-
portance of institutions is based on either macroeconomic stocks or anecdo-
Real Income in Belgrade in the Long Nineteenth Century 10
tal evidence, an approach widely shared by some other researchers in adjacent
disciplines , cf. Lju²i¢, Jagodi¢. A canonical example of this line of academic
argument is the railway track mileage in Serbia as a stock indicator of eco-
nomic development, relative to contemporary information on European states
(Palairet, p. 311). The extension of railways is taken to be a canonical example of
development, indicative of human welfare. 5 By contast, the approach has been
conested in contemporary development work. Recent literature has focused on
establishing a time series for nominal income and prices, centering the argument
on human welfare rather than on comparison between political entities.
This research aims to establish and assess real income series for Belgrade by
drawing on seminal work by Allen (2001) and Pamuk (2002; 2004). Implicit
in the approach of both of these authors is the understanding that data �ows
allow for formal model evaluation, and real income series in particular are the
preferred way to assess historical standard of living estimates. Further to appli-
cations, wages and prices series has been used experimentally, as �the historical
laboratory� for formal model evaluation, for instance, recent literature on mar-
ket integration6
2.1 The Great Divergence and Istanbul.
The evaluation of real income for regional economic centers has lead to observ-
ing wage divergence in mid- and late nineteenth century. London and even rural
English wages exceeded those in the Low Countries (Amsterdam, Antwerp) and
were several times greater than those in leading cities elsewhere in Europe,
a phenomenon termed �the great divergence� (Pomeranz, 2001). British ascen-
dancy was extended in the �rst half of the nineteenth century as English silver
wages rose to ever higher levels and continental wages stagnated, but England's
high wage economy clearly preceded the industrial revolution. Within a larger,
global framework, however, these same northwestern European cities are the
earliest that have been able to conclusively escape the so-called Malthusian
trap7, from the start of 1800s on, but especially from 1870 to 1914. Nonetheless,5While this understanding was widely shared by 19th century contemporaries, remarkably
no current literature on the Balkans have considered the alternative: that the opportunitycost of railways was too high. For a classical evaluation of the subject of railways in economichistory, see Fogel (1964).
6Jacks (2002) used price series in evaluating commodity integration of �Atlantic- tradingeconomies�, also appending Zundhaussen's (1989) data for Serbia.
7For a through treatment of the subject of Malthusian trap as such, see Clarke (2007), andsubsequent critique by McCloskey.
Real Income in Belgrade in the Long Nineteenth Century 11
formally evaluating real income series for urban economies outside of Western
Europe has been relatively recent endeavor, receiving renewed attention with
the return of interest in quantitative economic history and relative di�usion of
various econometric tools.
Great Divergence in particular has been the subject of much recent inquiry.
Many economic historians (e.g. North) seeking to answer the question why has
the northwestern Europe, in general, and England, in particular, been a�ected.
Remarkably for the wider economic history, the question of why not the Ot-
toman empire has not been asked often enough (Kuran, 2004, 2011). Real income
for Belgrade in the long nineteenth century has never been formally evaluated.
The urban economy of Belgrade is important for two reasons: as an addition to
the great divergence debate and as a test case for institutional homogenization
in the long nineteenth century. Within the context of preindustrial economies,
real income variation is seen as a good proxy for output growth or its absence.
Finally, it is also important for understanding the place of Ottoman economy
in the Great Divergence debate, as it establishes conclusively tha real income
path of another (post)Ottoman city
The data Pamuk uses in his seminal study of prices and wages in Istanbul
had been derived from some 6000 account books and price lists of religious
foundation, the imperial palace as well as prescriptions on price ceilings, starting
in the aftermath of the Ottoman conquest of Constaninople down to World War
I. For the period following 1860 values (see Table 2) from have been drawn from
the Istanbul Commodity Exchange, maintaining the bundle composition most
commonly found in the pious foundation accounts (Pamuk, 2004). Lespreys
index used for CPI is formally the ratio of price level of a bundle of goods in one
period to price level of the same bundle in base period, weighted for goods in the
bundle. In constructing the indices, Pamuk, uses local measures given in local
currency: okka and kile expressed through Ottoman akçe and (post 1820) kuru³.
The bundle of goods used was maintained partially because of the unavailability
of data on consumption. The food price indices were augmented by inclusion of
non-food commodities drawn from palace accounts, namely fuel and cloth.
The wages series, drawn from the same source, is monetary compensation for
unskilled and skilled masons, also given in Ottoman currency. Unlike the present
research, the primary purpose of Pamuk's e�ort is �to illustrate medium- and
long-term trends�. The author cautions against the accuracy of year-on-year
data, in part because of the exclusion of extreme values (realizations exceeding
Real Income in Belgrade in the Long Nineteenth Century 12
100 of prior price, not appearing again in following values) and also due to value
interpolation for missing years. Important for the structure of the data is the
observation on price intervention: consistently during the entire period there is
evidence of central government intervention which the authors take as indicative
of reducing volatility.
2.2 Belgrade: heterogeneity of money and power.
Another major motivation for Belgrade has been the curiosity of institutional
heterogeneity of money. Money as an institution homogenizing from some 38 dif-
ferent ones to one, following the introduction of silver dinar in 1879. Therefore,
as the duality of political authority (diarchy) disappeared, money as an institu-
tion was homogenized as well, with the introduction of silver dinar in 1879 (ZZ
XXXIV8). Therefore, in addition to establishing and evaluating standard-of-
living estimates for the period, this research hopes to illustrate a period doubly
useful in studies of economic development: to examine what, if any, e�ect has
homogenization of the institutions of political power and money had on eco-
nomic life of a city, as re�ected by the formal values of wages and prices, and
in particular does the homogenization of money by way of introducing national
currency reduce price volatility.
It is important to emphasize that two processes of institutional homogenization
(political power and money) are not independent of one another. Homogeniza-
tion of money as an institution closely mirrored political power maximization
of the Serbian state: as it gained more political control, it made e�orts to curb
the circulation of Ottoman currency (Lju²i¢, Kova£evi¢). Expulsion of Ottoman
garrisons in 1867 which signaled e�ective political control over Belgrade was
followed by introduction of Serbian copper dinar as a legal tender, albeit non-
exclusive, and formal independence of Serbian principality (July 13, 1878) was
followed by the previously noted intoduction of silver and gold dinars.
The twin processes of institutional homogenization (political power and money)
were not independent of one another. Homogenization of money as an insti-
tution closely mirrored political power maximization of the Serbian state: as
it gained more political control, it made e�orts to curb the circulation of Ot-
toman currency. Expulsion of Ottoman garrisons (e�ective political control over
8Law on Dinar, Feb 9/22, 1879, as per LC (ZZ) or �Law Collection�, volume 34, p.2. Seealso appendix.
Real Income in Belgrade in the Long Nineteenth Century 13
Belgrade and �ve other cities) was followed by introduction of Serbian copper
para, a sub-unit of dinar, albeit non-exclusive. Formal independence of Serbian
principality (July 13, 1878) was followed by the introduction of Serbian dinar
as the sole legal tender, at a parity with other Latin Monetary Union members.
Therefore, in addition to establishing and evaluating standard-of-living esti-
mates for the period, this research hopes to illustrate a period doubly useful
in studies of economic development. Speci�cally, to examine what, if any, e�ect
has homogenization of the institutions of political power and money had on
economic life of a city. The homogenization of money by way of introducing na-
tional currency could cause a reduction price volatility. Therefore, the premise of
the research is that the e�ect of homogenization, along contemporary Western
lines, is re�ected in formal values of wages and prices, which can be measured
and evaluated.
2.3 Serbia and Istanbul.
Taking population and trade volume as a proxy for economic importance (Allen,
2001), the signi�cance of Belgrade is indisputable. According to some sources
(i.e. Çelebi, 1660) the size of Belgrade was second only to Istanbul, at 98,000
inhabitants. While the population declined rapidly over the next century and a
half, it nonetheless remained an important regional center. While Pamuk (2004,
2005) has used the limited information available for Belgrade, other authors
have resorted to using data for Serbia as a whole.
Aside from research by Pamuk, this research also follows in the pioneering e�ort
of Zundhaussen (1989) (see table 1) who �rst published annual data on unskilled
wages and prices for Serbia, 1863-1910. Zundhaussen (p. 411, 413) published an-
nual means for selected goods and wages for Serbia, 1862-1910. While useful for
macroeconomic stock comparison, the data published is less useful for evalu-
ating and comparing ur. Published values for Serbia are annual means based
on a �uctuating number of markets, as little as 17 in 1863 to as many as 63
in 1905. Apart from Belgrade and Nis, none of these markets were urban in
the true sense of the word. Therefore, secondly, , namely in that most of the
population lives o� land. (Biljana Miljkovic-Kovacevic), Therefore, none of the
incomes recorded are actually urban, apart from Belgrade. And secondly, Zund-
haussen lead the pioneering e�ort in publishing annual Serbian mean unskilled
wages in the period, that is, annualized monthly means of means for a number
Real Income in Belgrade in the Long Nineteenth Century 14
of towns in Serbia. However, it needs to be noted that series published for Serbia
can be misleading. Calculated as unweighted mean of prices for a �uctuating
number of cities, it necessarily undervalues Belgrade. Serbian mean wages give
equal weight to Aleksinac, for instance, a town of 2,000 inhabitants in 1878. The
smaller urban centers neccesarily had semi-rural population (Miljkovic, 2006).
In contrast to Belgrade, as many as half of inhabitants of smaller centers made
living by subsistance farming. This further reduces the usefulness of collected
urban wags, as the
Further, the annual means he number of urban centers, the border of Serbia
changed twice in 1815 to 1908. First the limit of dual Ottoman-autonomous
Serbian rule was extended in 1833, then the freshly independent Serbia acquired
a 50% increase in land, and a 25% increase in population in July of 1878. This
is signi�cant for the comparison as further towns were added: only comparable
urban center, however, was Nis, which had circa 15,000 people in 1878, or slightly
more than half the population of Belgrade. Therefore, while useful for global
comparisons (i.e. Serbian v. Hungarian mean), the Serbian mean annual wages
are less useful for evaluating standards of living.
The only e�ort to evaluate formally the wage divergence between Ottoman and
�Western� economies (e.g. Istanbul and London), and within Ottoman economy
(capital and provincial centers) was the e�ort by Pamuk. In addition to original
research on Istanbul, Pamuk (2001, 2004, 2005) compiled data on other Ottoman
centers. This included all available, albeit still limited information on Belgrade
between c.1650 and 1800.
In constructing the indices, Pamuk, uses local measures given in local currency:
okka and kile expressed through Ottoman akçe and (post 1820) kuru³. The bun-
dle of goods used was maintained partially because of the unavailability of data
on consumption. (Pamuk, source here) The food price indices were augmented
by inclusion of non-food commodities drawn from palace accounts, namely fuel
and cloth (in ceki and ziraa units).9 The wages series, drawn from the same
source, is monetary compensation for unskilled and skilled masons, also given
in Ottoman currency. Unlike the present research, the primary purpose of Pa-
muk's e�ort is �to illustrate medium- and long-term trends�: the author cautions
against the accuracy of year-on-year data. In part due to the exclusion of ex-
treme values (realizations exceeding 100% of prior price, not appearing again in
following values) and in part because of value interpolation for missing years.9See appendix for a comprehensive treatment of Ottoman units.
Real Income in Belgrade in the Long Nineteenth Century 15
Important for the structure of the data is the observation on price intervention:
consistently during the entire period there is evidence of central government
intervention which the authors take as indicative of reducing volatility. For the
period following 1860 values from have been drawn from the Istanbul Commod-
ity Exchange, maintaining the bundle composition most commonly found in the
pious foundation accounts (Pamuk, 2004).
The data presented here is a direct extension to Pamuk's (2002, 2004) research,
using previously untapped sources. Constructed as an annual time series of
unskilled wages de�ated by a basket of most commonly present goods, the re-
search aimed to show long-term trends in Ottoman economy, and conclusively
demonstrated a trend parallel to the Allen's set, from the de�ation of late 17th
century to the Divergence of the latter half of 19th century. The research is all
the more fascinating given that the Ottoman share of the world economy was
shrinking (Madisson) from 17th century onwards. As some researchers (Kuran,
2000) noted, it was the Ottoman economy, the largest European economy in
mid-15th century, that had the most spare capacity for growth, especially given
the early Ottoman technological innovation, especially in military technology,
ie cannon-building (Inalçik). More to the purpose of this research in the narrow
sense, the contribution of Pamuk to the larger e�ort at evaluating real income
has been critical in motivating the research on Belgrade, especially because Bel-
grade has been part of the Ottoman order for centuries prior to a deliberate
political attempt to move away from Istanbul politically.
Real Income in Belgrade in the Long Nineteenth Century 16
3 Data Description
3.1 The collected information on Belgrade.
The data for Belgrade was constructed using circa 2,000 archival units: price
lists, published laws, rulings, decrees and other legislation, contracts and per-
sonal correspondence and miscellaneous documents such as royal court menus.
Taking after the recent e�orts to establish a comprehensive real income series for
a number of cities, Istanbul included, the research collected prices and nominal
wages for a number of historical occupations. These ranged from highly-skilled,
salaried occupations to skilled (mason, plougher) to low-skilled (day laborer).
Skill mapping was based on literacy (highly-skilled) and experience (middle-
versus low-skilled).
In particular, the research rests is based on open market price lists collected
biweekly, then weekly by the Commercial Court in Belgrade (1843, 1844, 1849,
1861) and later collected and compiled by the Statistical O�ce of the Ministry
of Finance and Ministry of Popular Economy (1862-1905). The price lists were
collected at a single goods and labor exchange, the Grand Market in Belgrade,
operating from 1824 to1926. The lists collected and compiled by Commercial
Courts and the Statistical O�ce are likely to include errors. Given that the
collecting and supervising authority remained the same, the errors are unlikely
to be stochastic. Finally, in addition to market place data, another principal
source were salaried employees, i.e. highly-skilled labor, was a review of a com-
prehensive collection of Serbian legislation in the period, 63 tomes in total,
spanning 1830-1908. This data As the position requirements changed, and new
positions opened over time (eg. telephone operator) no monthly time series was
constructed. Instead, the data highly-skilled labor was used to establish skill
premium at speci�c times.
To this core band of data were appended information obtained through commer-
cial contracts and o�cial and personal correspondence, including prices from
August 1805 (earliest observation), and prices and unskilled wages scattered
throughout 1819 to 1837. This includes prices both in and around Belgrade, no-
tably from the Ostruºnica river border crossing with the Habsburg Monarchy.
Spot prices for border goods are gross of variable customs but net of market
duty, thus showing a systemic di�erence from Grand Market prices. Meanwhile,
�broad� band of data It should be noted that little information was available
Real Income in Belgrade in the Long Nineteenth Century 17
from the local counterpart of the Ottoman Central Palace, as no systematic
procurement lists are preserved for the Serbian Court. That said, the prices ob-
tained from local correspondence are prices of goods purchased for the Prince,
often for provisioning his Belgrade residence. Finally, the primary research for
the earliest years (1660, 1718) relied on prices and wages recorded in contem-
porary travelogues, especially Çelebi (1660) and Montagu (1718).
All of the data thus collected was standardized to metric units and grams of
silver. The nominal wages were then de�ated using a bundle of goods centered
on a historical bundle �rst used by Allen. Furthermore, taking advantage of
the collected data, a separate, wholesale index was constructed. In the process,
the research established the consumer price index for Belgrade, compared its
�ndings to the rest of Serbia and Istanbul, and formally evaluated two time
series �nding evidence of cointegration. Finally, the research also proposed an
institutional avenue for evaluating its �ndings, taking a look at the institutional
change in the Ottoman and post-Ottoman societies
3.2 Constructing the bundle: is it a good a measure of a
standard of living?
The chosen de�atonary bundle for the nominal incomes was established in re-
cent literature (Allen, 2001) as a standardized measure corresponding to basic
nutritional need of an adult human. The choice is not without controversy:
present-day need for c.1990 calories is based on a mean for an adult healthy
human. In practice, nutritional need is a function of both gender and lifestyle
choice. As importantly, historic populations experienced widespread failure to
attain body size corresponding to their genetic predispostion. As a result, the es-
tablished dietary values would systematically overstate hardship for populations
whose health was signi�cantly worse, eg. as indicated by height records. Fur-
thermore, some recent literature (Pogleovo, 2011) has argued that basic caloric
intake should be replaced with share of staple foods consumed. Populations ex-
periencing severe deprivation tend to consume a larger share of coloquial staple
foods (i.e. rice and wheat in Yangtse or Danube river valleys, respectively).
There is empirical evidence from panel data to suggest that the point at which
household switches to foodstu�s rich in micronutrients is the threshold for lib-
erty from hunger. Ultimately, the research argues that excessive focus on caloric
intake leads to overinvestment in staples production.
Real Income in Belgrade in the Long Nineteenth Century 18
However, caloric intake from staples is vital in a historical context, where yields
were considerably lower (three times for the region of Serbia). Demanding physi-
cal work required caloric needs well in excess of mean recommended intake today,
in spite of smaller stature or built. Military meals for Serbian army (1876) have
regulation for 4300 calories. Therefore, primary focus in Belgrade as well as the
Ottoman universe as far as Van, were staples, especialy wheat bread (Faroqhi,
2007). Therefore, a basket based on staple grains and its derivatives (i.e. bread
in Belgrade, pasta in Yangtse river valley) is a good measure of a standard of
living, as diversity of nutrition neccesarily had to be of secondary importance.
Furthermore, the primary purpose of this research is not the evaluation of nu-
trition patterns, but the gauge of standard of living. There is no doubt that
consuming exclusively the posited bundle would, in fact, be detrimental to indi-
vidual health. Nonetheless, the ability to purchase more three bundles, even if
staples-heavy 10 indicates the ability to purchase other foodstu�s or items. This
is especially signi�cant given that unskilled laborer did in fact receive part of
their compensation in food: welfare ratio higher than one indicates the ability
to maintain the essential welfare of both oneself and the constructed nuclear
family.
Another caveat regarding the construction of the CPI and SOL concerns the ef-
fort to capture the �uctuation in quality of goods. To which extent are the com-
modities homogeneous? Grains (wheat, maize, barley, oat) were not controlled
for moisture, for instance; no data exists regarding the fat to muscle ratio in
meats (mutton, beef, pork). Having said that, the collectors of data themselves
were aware of the problem. In the remark prefacing the 1863 Drºavopis price
lists, the author notes that �prices given here exclude goods of the very best,
as well as the very worst quality� in order to evaluate whats ostensibly the me-
dian quality, �as ascertained by our inspectors, men well trained and previously
employed in the trade� (Statistical Notebook II, 1864). Formal control of grains
was leglislated in 1898 (see Table 2).
Further argument for basket validity is one from verbal characterization: �wheat�
would not have been undestood as �wheat� if the moisture percentage was higher
than accepted. Later standards were empirically based. The legislation on grain
quality was based, in part, on locally accepted practice. (see Table 2). While
the empirical evidence is absent, the percentages given in Table 2 indicate that10That is, having the welfare ratio above one (w > 1).
Real Income in Belgrade in the Long Nineteenth Century 19
maximum allowed wheat barley oats rye
impurities 1% 1% 1% 1%
broken grain .5%
weed content (esp. melanpyrum) 10% 8% 6% 10%
total unusable 11.5% 9% 7% 11%
Table 1: Industrial s tandards for agricultural products, 1898.Source: ZZ LIII, p.93.
variance in quality of the produce might not have had at the time. More impor-
tantly, they indicate a persistance of perception. As long as the quality of goods
is homoskedastic within baskets at di�erent times, the comparison between real
incomes makes sense.
3.3 Constructing the bundles: composition for Belgrade.
The indices in Belgrade were constructed with the view to closely follow the
recommendation of Allen and take advantage of collected data. Therefore, three
indices were used, namely Allen bundle, its geometric equivalent, and a separate
measure of wholesale prices.
The standard-of-living (SOL) basket, was constructed with the view of being as
close as possible to the Allen bundle. The goods used correspond to personal
neccesities, based on historical patterns of daily life in Northern Europe (Allen,
2001). The total caloric intake, at c.200011 kcal, is close to contemporary intake,
however, with some two-thirds of the calories originating in bread. Further to
food, soap, cloth, candles and oakwood as fuel were added. The energy value
for wood (5 M BTU) corresponds to Allen's Northern European average, taking
into account the more continental climate of Belgrade. Following Allen's rec-
ommendation, the total thus obtained was increased by 5% to take rent into
account. Therefore, the value of the bundle is a comprehensive measure of basic
human need.
The welfare ratio computed based on three Belgrade SOL bundles, to take into
account the nuclear family of four (two adults and two children). The projec-111941 in the original Allen work, 1964.6 for Belgrade. See Table 2.
Real Income in Belgrade in the Long Nineteenth Century 20
Item Annual Values Calories Proteins Share
Allen Belgrade Allen Bel-
grade
Allen Bel-
grade
%
Bread 182 kg 182 kg 1223 1286 50 49 30.4
Beans 52 liters 52 liters 160 202 10 13 6
Meat 26 kg 26 kg 178 170 14 15 13.9
Butter,
Lard
5.2 kg 5.2 kg 104 128 4.3
Cheese 5.2 kg 5.2 kg 53 37.5 3 2 3.6
Eggs 52 each 52 each 11 10.1 1 .8 1.3
Alcohol 182 liters (beer) 45.4 liters (rakija) 212 140 2 20.6
Soap 2.6 kg 2.6 kg 1.8
Cloth 5 m.sq. (linen) 1.2 kg (wool) 5.3
Candles 2.6 3.9 3.1
Lamp oil 2.6 liter 4.7
Fuel 5 M BTU 5 M BTU (Oak) 5
Total 1941 1964.6 80 79.8 414.899
Table 3: Comparison of bundles, Allen and SOL (Belgrade).Source: Allen (2001), collected original data for Belgrade (see Appendix). Note: the total given in
the spending share column is the total value (in grams of silver) of the Allen (Strassbourg)
1745-1755 bundle.
tion of annual income was based on 250 working days. The 250-days, suggested
by Allen, take into account both time o� due to illness and various holidays,
religious and otherwise. The lenght is broadly in line with results for male pro-
ductivity in Serbia o�ered by Calic (2004), based on a 1900 survey.
Real Income in Belgrade in the Long Nineteenth Century 21
Per recommendation, the prices in SOL are not wholesale, except for beans. The
conversion for rakija was partially based on the explicit assumption of median
value eqality in adjacent periods introducing a measure of stationarity. Eggs,
candles and soap were interpolated in missing months, again based on median
values of adjacent periods. While this neccesarily induces a level of stationarity,
nevertheless the combined value for these goods is not in excess of 10%, ensuring
the validity of the bundle.
The geometric (SOL) bundle emphasizes extreme values of SOL valuation. With
the bread likely having a greater share in spending in recesssion (Allen), its
proportion has been adjusted to 50% of total of 1745-1755 Strassbourg Allen
bundle. The other commodities have been adjusted proportionally.
The Consumer Price Index (CPI) for Belgrade was constructed using unweighted
Laspreyes Index (formally, with weights equal to unity) for spot prices of thirteen
commodities, namely wheat, maize, barley, oats, hay, beans, potatoes, bread,
beef, pork, cheese, oxen, cows. Grains, hay, maize and livestock are all wholesale.
Selection of goods for the CPI index were based on their relative frequency in
the price lists. Presence of goods re�ected their relative availability. Speci�cally,
while the number of goods in price lists varied (minimum of 59 to a maximum
of 139) the absolute frequency of goods used to construct CPI was above 90%
for twelve months in 1843-1844, 1849 and 529 months in the period 1861-1905.
The principal reason why two Laspeyres indices are used is due to the data
structure. The CPI (wholesale) index explicitely takes most common goods.
allowing for the change of its value to be a better measure of in�ation. Meanwhile
SOL (Allen) index is a better gauge of the value of basic need. The nominal
income was de�ated using both, for further clarity.
The results for various bundles are given in Figure 2. The Geometric index (2)
emphasizes the movement of the Allen based (SOL) bundle. The value of the
bundle oscillated, especially in the apparently tumultous 1880s, at the end of
the period reaching reaching a 40% higher value that the Allen's yardstick of
Strassboug, 1745-1755. Meamwhile the CPI index broadly followed the drift,
becoming more volatile towards the end of the period. The measure of in�ation
given is the annualized monthly �rst di�erence in CPI.
Real Income in Belgrade in the Long Nineteenth Century 22
11.21.41.61.8Belgrade SOL (Allen) annualized
1860
1870
1880
1890
1900
1910
year
.811.21.41.6Belgrade SOL wrt Strassbourg
1860
1870
1880
1890
1900
1910
year
152025303540Belgrade CPI
1860
1870
1880
1890
1900
1910
year
80100120140160Geometric SOL bundle
1860
1870
1880
1890
1900
1910
year
Figure2:
Price
indices1843
�1905.
Clockwisefrom
top:(3)Allen
SOLBelgrade,annualized(1)BelgradeSOLbundleexpressed
interm
softhevalueofAllen'sStrassbourg
bundle,1860-1905;(3)Geometricindex
(constantshare)Allen'sbundle;(4)CPIBelgrade,monthly
movem
et.Source:collectedoriginaldata
forBelgrade(seeAppendix).
Real Income in Belgrade in the Long Nineteenth Century 23
3.4 Wages and salaries in the Ottoman universe.
Real income, that is, nominal income de�ated by a bundle of goods, is a good
measure of utility if subject to three simple conditions. Namely, the total utility
of an individual from birth up to a period t is a function of her nominal monetary
income (i), status associated with income stream (p), and a catch-all shock
operator epsilon (i.e. utility derived from marriage, death, etc). The nominal
monetary income and status are montonous in s, which is the skill level, with
high skill (h) de�ned as strictly greater than medium, in turn de�ned as strictly
greater than low (l) skill (equation 3). Furthermore, the activity in which the
agent is presently engaged has strictly greater utility than the outside option
(equation 2).
(1)∑n
i=1 uni(is, ps, ε)> 0
(2) un(is,ps, ε) >un(ios, pos, ω)
(3) s = h,m, l ∧h > m > l
These three simple conditions state that the agent seeks positive utility from
their work, and that the activity in which they are presently engaged is the
optimal for their skill level. That is to say, a person working as a mason in
January 1863 could not have done any better given their skill, and their utility
from working as a mason is positive.
The premise of �uctuation of real income as measure of human hardship (or its
absence) is less evident the further back one goes. Rural, pre-industrial incomes
were largely nonmonetary. Daily wages were an important, but not the exclusive
source of monetary income: total compensation for work rendered could, and
indeed, often did include food aside. This is especially true of more strenuous
activities such as plowing. A skilled plower was available for hire in an urban
center like Belgrade: but total compensation did specify nonmonetary compen-
sation, speci�cally food for the worker and feed for the pair of oxen. While
nonmonetary compensation was present, the information on wages nonetheless
remains a good gauge for the standard of living: monetary wages were neces-
sary for the sustenance of worker's families, especially so since possibilities for
female employment remained limited throughout the period. Belgrade as a ma-
jor center actually had labor for agricultural work (ploughing, harvesting) for
hire, o�ering a unique glimpse into rural to urban real income movement in
the Ottoman empire. In summary, the data collected will be discussed in detail
Real Income in Belgrade in the Long Nineteenth Century 24
further on: critically, however, it is important to underscore the usefulness of
prices and wages data in evaluating the standard of living, in spite of possible
caveats.
Another challenge is the �uctuatons in size and informal barriers to urban labor
markets. For smaller urban centers, it would be di�cult to argue that the labor
pool was deep enough to re�ect the condition of all individual agents within the
economy. However, Belgrade, as a major political center, was a major magnet of
both skilled and unskilled labor. For instance, a newly apointed political func-
tionary would typically require unskilled labor to assist with moving to a new
residence in Belgrade, and masons to help refurnish it both before and after.
Furthermore, even the relative shallow labor markets o�er a good skill mapping.
Rather than focus on how many laborers or masons, establishing real income
series o�ers a measure of opportunity cost for certain skill set. Therefore, some-
one working as a carrier or a ferrier would ostensibly face similar opportunity
cost.
The skill mapping is less clear with respect to rural incoms. To take a canonical
example, absent a market surplus, the income of a tenanant on a large feudal
estate is simply what he grows in a year, net of landowner's share (i.e. Ray, 2000).
In fact, the predominance of nonmonetary substinence agriculture. Isolation
from formal economy neccesarily a�ects reduces comovement of rural and urban
incomes. Therefore, opportunity cost for mason or laborer would be less relevant
in evaluating rural incomes. However, the research did collect information on
agricultural-type labor for hire, allowing for evaluating the rural skill mapping.
In the entire Ottoman universe, Belgrade included, the emergence of a �xed
salary as the exclusive source of income resulted from the emergence of formal
state bureacracy.12 The data on various salaried employees were working for
the state. However, with the adequate skill mapping, the opportunity cost of
highly-skilled labor in te private sector can be safely evaluated. For example, the
scribe working at a government o�ce in c. 1900 would have income comparable
to equivalent-skill agent, e.g. a scribe in a private insurance company. Just as
important, the status (note equations 1 & 2) would be equivalent, allowing for
a precise evaluation of highly-skilled labor.
The wages thus collected are equivalent to employer expense on a single worker,
per diem. This wage is not in direct function of workers productivity and often12That in turn transplanted the formal institution of joint-stock company (German Ak-
tiongeselshaft in the Serbian case.
Real Income in Belgrade in the Long Nineteenth Century 25
would not include the food rendered on the site. Therefore, it is an implicit, and
not a direct measure of worker productivity. The wage is not tied to how many
bricks did a workers carry or lay, but to how much does it cost to hire a worker
at the marketplace to work at your site for a day. However, numerous anecdotal
evidence (formal correspondence) demonstrates that productivity was expected
to be up to par with the construction speci�cation, even if no formal value (ie of
bricks moved, or laid into walls) was speci�ed. To illuminate the point further,
note the example of a mason's compensation, The mason would not receive
compensation for how many bricks did he13carry or lay, but to how much does
it cost to hire a worker at the marketplace to work at your site for a day.
However, numerous anecdotal evidence (formal correspondence) demonstrates
that productivity was expected to be on par with the informal job speci�cation,
even if no formal value (i.e. of bricks moved, or laid into walls) was speci�ed.14
13Invariably he, as there is no record of contemporaneous female masons. See further for adetailed discussion on gender and real income.
14For an example of Belgrade construction workers demanding a raise, see Appendix 4.3;the daily wages of three levels of skill of construction of workers were duly noted �for themaster to ascertain whether the workers are receiving too little�
Real Income in Belgrade in the Long Nineteenth Century 26
4 Formal analysis of data.
�...impoverishment of tradesmen in the past 30 years [caused by]
...small wages, and unreasonable prices of basic goods have lead to
a tradesman spending on basic food neccesities (bread, beef, beans,
potatos, lard) about 1/4 of his earnings�
State Annals, Vol. II, 1863. 1864. p. 134.
4.1 Twin divergence. The Ottoman drift.
The urban nominal income in Belgrade follows the movement in Istanbul. The
incomes diverge in a similar way, both from the fastest growing section (NE
Europe) and the slower growing remainder of the continental cities. Broadly,
the dynamics of real income tends to be lower along a north-west to south-east
axis. While nominal income in silver in London grew by a factor of 7, with
exponential dynamics, in belgrade The exponential growth observed elsewhere
failed to happen in the two cities. As a result, Belgrade and Istanbul had the
lowest real income for urban laborers and masons at the begining of 20th century
(Table 3).
The di�erences become more evident when de�ating using a constant Çelebi
bundle from 1660. To compare levels at d�erent times, information on prices in
Belgrade given in Celebi's Travelogue was used to construct a simple bundle.
Assuming
Another remarkable feature of the long-term review of real income is the compa-
rable movement of nominal income in Belgrade and Istanbul. The data suggests
that there has been no great divergence between the real incomes in Belgrade
and Istanbul. This result is all the more remarkable given the prior history of
the two cities. Inspite of the turbulent political struggle for independence, the
cities of the Ottoman universe maintained the same path of change of real urban
income. In the second half of the 19th century, the average income for the un-
skilled daylaborer di�ers only at the third decimal: the nominal income 8.1828
in Belgrade versus 8.1805 for Istanbul. The convergence is especially signi�cant
considering that the values for Belgrade refer to the period ending in 1905. If
the value for the same period is used for Istanbul, then the income is reduced
to 8.2 (versus 9.3 in Belgrade) for laborer and 17.8 (versus 15.1). Therefore, the
long-term drift in the two cities is comparable.
Real Income in Belgrade in the Long Nineteenth Century 27
Skilllevel
Laborer
BuildingCraftsm
en
Years
1650-
1699
1700-
1749
1750-
1800
1800-
1849
1850-
1899
1900-
1913
1650-
1699
1700-
1749
1750-
1800
1800-
1849
1850-
1899
1900-
1913
Belgrade
5.4
2.4
2.5
8.2
9.3
6.2
4.1
4.6
13.1
15.1
Istanbul
4.3
3.3
3.8
5.3
8.2
9.7
6.4
5.3
7.1
9.6
16.2
20.8
Serbiantowns
6.1
5.5
10.5
11.8
Vienna
3.5
3.2
3.0
2.1
4.2
43.5
5.2
4.8
4.8
3.2
6.6
59.1
Antwerp
7.1
6.9
6.9
7.7
12.7
32.4
11.8
11.5
11.5
12.8
20.5
53.1
Amsterdam
8.5
8.9
9.2
9.2
16.3
48.6
11.9
11.7
11.9
12.1
21.4
64.1
London
9.7
10.5
11.5
17.7
31.2
71.5
14.5
14.7
17.8
28.9
48.3
106.4
S.English
towns
5.6
7.0
8.3
14.6
25.4
57.9
8.4
10.4
12.6
22.0
39.6
87.1
Florence
10.8
25.0
15.9
35.2
Milan
4.1
3.2
2.9
3.1
7.3
22.4
8.0
6.1
5.4
6.2
13.2
45.5
Madrid
5.1
5.3
8.0
9.7
19.0
15.1
11.6
10.7
16.5
19.2
32.0
Paris
6.9
5.1
5.2
9.9
21.4
52.2
11.0
8.2
9.3
16.4
34.4
76.3
Strasbourg
3.1
2.9
3.3
8.1
9.3
8.3
4.4
5.5
10.6
11.7
Leipzig
3.9
3.7
3.1
4.4
14.8
51.6
7.0
6.2
5.0
6.7
22.5
71.9
Munich
4.7
3.8
3.2
74.7
Krakow
2.9
2.2
2.9
2.4
7.1
24.1
4.1
3.3
3.8
5.2
15.9
35.0
Warsaw
2.7
1.9
3.4
4.9
9.1
26.3
4.3
5.3
7.4
10.9
20.1
50.1
Table4:
Nom
inal
wages
ingram
sof
silver,select
cities,1650
to1914.
Sources:
Belgrade,1650-1800,Pamuk(2004)basedondata
byBerov;Belgrade,1800-1913,Drºavopis,I-XVIII,
StatistikaCena,I-III,
otherAS;Istanbul,
Pamuk(2004);
Serbiantowns,
Zundhaussen(1989)basedonDrºavopis
XVIII,
State
statisticsforyears
1906-1910;allotherwagesascompilledbyAllen
(2001).
Real Income in Belgrade in the Long Nineteenth Century 28
One perplexing feature, given the premium on both skilled and unskilled wages
in Belgrade and Serbia, is the absence of travel. It would appear that the real
income di�erential (Belgrade higher two to three times, cf. table 3) would in-
centivize the population of surrounding settlements. This was not the case. It
is doubly interesting, therefore, to review the real income of unskilled laborer
with respect to transportation costs: one, for evaluating the absence of large-
scale migration, and two, as de�ated transportation costs allow for evaluating
the market integration of the region as such.
4.2 High-skilled income in Belgrade. Administrative and
judicial sta�.
Closer analysis reveals that positions of political power were correlated with
higher real income, especially at the highest ranks. The 1835 Constitution has
formal provisions for the annual pay for the Prince, valued at 120,000 thaler and
inclusive of the household upkeep expense (20,000) (ZZ XXX, p.8). Exactly sixty
years later, in 1895, the annual appanage due to the abdicated king was 360,000
dinars in gold (ZZ L, p.351). In real terms, this represents a 20.8% increase, from
a welfare ratio of 1944 to still more staggering 2454. In theory, both sums were
discretionary, explictly so (�the popular treasury will award te prince, princess
and their family an annual pay to be spent at their own pleasure�) in the text of
the constituon. However, the 1835 �gure does imply that at least some portion
would be spent on exercising stately duties, i.e. receiving dignitiaries local and
foreign in the household. The 1895 appanage has no such implications: support
for the abdicated king had no purpose other that to �maintain the former king
in proper dignity of his former o�ce�. The former sovereign was entitled to
equivalent of real income of a small town, i.e. 2062 mean daily urban wages of
unskilled laborers.
The income of the ruling dynasts are outliers, however, both formally and in
terms of requisite skills. Only a member of the rulling family would be entitled
to above income, rendering a skill mapping impossible15. The ranks of political
o�ces accessible to the Belgrade and Serbian public were considerably lower.
The two brothers of the prince were accorded some 10,000 thalers, or the ratio15Nevertheless, a direct comparison to contemporary heads of state and government is pos-
sible. It would be interesting to see whether a more open access to the ultimate politicalposition reduces formal rent (explicit monetary compensation).
Real Income in Belgrade in the Long Nineteenth Century 29
equivalent of 162, the equivalent of maintaining 20 eight-member families. Their
families would receive half of that following their deaths (ZZ XXX, p.9). The
closest o�cial in the entire period is the voivode (vojvoda) at 102 16 in 1901
(ZZ LVI, p.155). Interestingly, the highest positions
The incentive structure of monetary compensation for highly skilled labor force
was partially based on credentials and output and partially on simple seniority
scheme. Hiring decision in part required educational quali�cation/credentials,
canonical examples of signalling high skill. However, wage raise was primarily
a function of years spent: pay grades were de�ned on years spent, rather than
output rendered. Only a most egregious breach of discipline, or sedition could
bring termination. However, immediate superior could decide on a pay raise in
the intermediate level, and an employee could request transfer to a di�erent,
better compensated service. For instance, in 1901, a secretary at the appleate
court could be someone �with 2 years in prior service in law; but it could also
be �employee of any service� albeit with a 4 year experience. (ZZ LVI, p.53)
4.3 High-skilled income in Belgrade and gender.
Of particular interest is the female income in the period. Unique �nding is the
monthy wage for �a washlady and a homemaker� from 1863, equivalent to 1,94
1880 baskets, higher than the skilled male (mason) mean for the period (1.57).
Sadly, this is the only example of market equivalent of monetization of household
labor, but it does indicate that female formal salaries were competitive when
the state as the employer aimed to attract female employees. Typically, however,
the formal labor market opportunities were limited and few. While the number
of positions open to women increased, the limitations grew as well.
Education o�ers one example of such gender-based labor market rigidities in-
creasing with time. The earlier (1850, 1857, 1859, 1860, 1871) regulation on
elementary school wages had gender parity in wages. Regulation from 1872 fur-
ther allows for �female teachers in elementary schools for boys, given requisite
credentials� (ZZ XXV, p.9). This, however, changes in 1898: the guidelines for
teachers in elementary schools both de�ne explicitly smaller salaries for same
work, and limit female professional opportunites. In that regard, a female teacher
would start with an annual wage of 750 dinars (5.1 baskets), receive periodic
raises of 250 until reaching her maximum at 2250 (15.34) after six years of16Roughly equivalent to the �eld-marshall in the contemporary Western armies.
Real Income in Belgrade in the Long Nineteenth Century 30
service. Meanwhile, a male elementary school teacher would start with 1500
(17.16), receive periodic raises of 250, then 300, until reaching his maximum
at 2450 (28.02). Analoguously, a director (head) of the school would make at
most 2750 (18.75) if female or 3600 (24.54) if male. While earning 5.1 baskets
would not allow for a female to support independently a famly of �ve, it should
be noted that a value of 18.75 would. However, female teachers were explicitly
disallowed to hold position of directors, so long as �there are male teachers in
a school�. Furthermore, only female members of male teachers families were el-
igible, further limiting labor market access. It appears that the gender-based
discrimination (labor market rigidities) were placed with the implicit goal of
circumscribing opportunities for independent female formal income that could
potentially upset the paradigm of patriarchal, male-breadwinner model of fam-
ily. Leaving ancillary disciplines to explore that hypothesis further, formal limits
in education nevertheless indicate that minimizing unemployment was not the
priority for the state as the employer.
Real Income in Belgrade in the Long Nineteenth Century 31
4.4 Narrow band. Time series analysis.
Unskilled monthly time series were thus established for two principal categories
of unskilled urban labor, namely daylaborer-at-large and mason. Within the
frame of skill mapping, the mason series would correspond to �medium�, and
laborer to �low�, as it required no prior knowledge whatsoever. In addition, two
rural series, namely mower (harvester) and plougher series have been established
as well, although both mapping more closely to mason. The �medium� skill
level for two stems for the fact that both required both experience, and in
the case of plougher, consderable capital (a plough and two, then four oxen).
As noted previously, �unskilled� here refers to labor not requiring literacy as a
quali�cation. All three of the categories, save day-laborer, did require a level of
skill in that particular craft, if not neccesarily formal professional organization
membership.
Taking the advantage of monthly data, all series have been deseasoned by taking
into account only second and third quarters for the annualized summaries. This
might imply somewhat smaller values for urban series, but it does eliminate the
outliers for rural-based occupations, as sowing and harvesting in colder months
is unusual.
Unskilled laborer is a composite measure of unspeci�ed �daylaborer� and dig-
ger, prior to 1869, the �rst year when they were recorded seprately. Implicit in
collating two time series before 1869 is the perfect substitutability between the
two. Formally, there had been a price premium for several years in 1860s: how-
ever, perfect substitutability was made explicit in contemporary summaries17,
which nonetheless fail to explain the price premium. Assuming, however, perfect
substitutability, the laborer-digger is the basic evaluation of unskilled workers:
composite unskilled wage is an unweighted mean of laborer-digger, mason and
mower.
Narrow-band monhtly data for mason starts in August 1862, and continues, with
gaps to December 1905 for a total of 459 observations (or 86% of total possible
realizations). Data for laborer starts with November 1861, and continues to the
same end, with a total of 498 observations (or 94% of total possible). The rural
data is less aboundant, with 132 observations for mower and 204 observations
for plower.
The evidence suggest a long-term drift towards a greater premium on skilled ur-
ban income. In the four decades period from 1860 to 1900, the urban premium
Real Income in Belgrade in the Long Nineteenth Century 32
012345(mean) welf4mas
1860
1870
1880
1890
1900
1910
year
012345
(mean) welf4lab
1860
1870
1880
1890
1900
1910
year
012345
(mean) welf4masi
1860
1870
1880
1890
1900
1910
year
012345
(mean) welf4labi
1860
1870
1880
1890
1900
1910
year
Figure3:Urban
wages
monthlyseries,annu
alized.1860
to1905.C
lockwisefrom
top:
(1)Mason
welfare
ratios,C
PI;(2)Laborer
welfare
ratios,CPI;(3)Laborer
welfare
ratios,SO
L;(4)Mason
welfare
ratios,SO
L.Source:collectedoriginaldata
forBelgrade(see
Appendix).
Real Income in Belgrade in the Long Nineteenth Century 33
02468101214(mean) welf4mow
1860
1870
1880
1890
1900
1910
year
02468101214
(mean) welf4plo
1860
1870
1880
1890
1900
1910
year
02468101214
(mean) welf4mowi
1860
1870
1880
1890
1900
1910
year
02468101214
(mean) welf4ploi
1860
1870
1880
1890
1900
1910
year
Figure4:Rural
wages
monthlyseries,annu
alized.1860
to1905.C
lockwisefrom
top:
(1)Mow
erwelfare
ratios,C
PI;(2)Mow
erwelfare
ratios,C
PI;(3)Plougherwelfare
ratios,S
OL;(4)
Plougherwelfare
ratios,S
OL.S
ource:collectedoriginaldata
forBelgrade(see
Appendix).
Real Income in Belgrade in the Long Nineteenth Century 34
nearly doubled (0.7 to 1.34), with a maximum value of 1.7 in the 1895-1900
period. The values, calculated for Allen are more constant. For the entie period,
the skill premium increased 20% from 0.93 to 1.1. Furthermore, the rural to
urban convergence is evident, with mason premium on mower increasing dra-
matically (0.5 to .4 CPI and -.22 to .32 SOL, .59 in 1895-1900). In fact, the
premium measured at SOL (Allen moving) bundles was actually negative, i.e.
mower commanded a higher price for all of the �rst decade; skill di�erence at
CPI was also negative in 1866-1870. Comparable development can be observed
with plougher, with the premium on a plougher being reduced threefold, (-9.25
to -3.33 CPI and -6.5 to -1.89). The plougher di�erence is particularly signi�-
cant as the di�erence would imply the (lack of) ability to maintain the extended
family.
The two urban time series o�ered evidence of a functional relationship. Simple
regresssion of laborer on mason indicates a positive autocorrelation. Positive er-
rors follow other positive errors, and likewise with the negative ones. Regressing
residuals on its lags in fact reveals a strong error co-autocorrelation (adjusted r
value of .6153) further con�rming the relationship between two time series. By
contrast, the relationship between mason and rural timeseries reveals no error
co-autocorrelation, further a�rming the decoupling hyporthesis for rural and
urban incomes.
The formal analysis rested on evaluatating narrow band pairs of time series,
namely mason and laborer as (1) and plougher and laborer as (2) pair. Pairwise,
the real incomes have been evaluated for autocorrelation, heteroskedastic and
autocorrelation consistent (HAC) standard errors, ordinary and non-linear (OLS
and NLLS) regression models, stationarity using augmented dickey-fuller test,
cointegration using engle-granger test, vector-regressive impulse response (VAR
IRF) as well as integrated autoregressive moving average models (ARIMA). The
results of these evaluations are given below.
Cointegration of labor and mason time series was evaluated with the Engle-
Granger regression-residual test. Following a linear OLS regression of mason on
labor, the residual of the regression was regressed on its �rst di�erence, �rst lag
and the �rst di�erence in lags. Its critical value of -6.539 was outside the region
of acceptance (with a bound of -3.37 at 5% signi�cance). As a result, the null
hypothesis of the nonstationarity of residuals was rejected, concluding that the
regression residuals are stationary, and the two series are therefore cointegrated.
Real Income in Belgrade in the Long Nineteenth Century 35
The functional relationships between the two urban unskilled series was further
evaluated using a binomial probit model. Establishing a binomial series for oc-
curence of laborer wages, the model posited a relationship between the indicator
(1,0) and respectively, mason, CPI price level, price of bread and two meats.
The result is remarkable. Marginal change in all estimators lead to increased
probability of the occurence of labor, except for bread. The absence of bread is
signi�cantly (coe�cient of -3.474726 at 95% level) inversely correlated.
As the price of bread rises, the likelihood of laborers auctioning o� their work
was lower, and vice versa. Presumably, this is due to unique importance of
bread17: rise in prices could lead many to conclude that the opportunity cost of
o�ering labor is too high. This could indicate that given a prolonged period of
sustained rise in bread prices, rioting would occur simply as means to provide
sustenance. Conversely, some the months in which laborer on o�er was absent
were war months (october 1876 to march 1877), but most were not. Therefore,
rather than any religious or social distance, it is the price movement of bread
that could be a good indicator of likelihood of social unrest.
4.5 Indices composition and drivers of change.
Given the nature of construction, the CPI change re�ects variables driving rela-
tive supply and demand. Regarding the supply side, the agricultural structure of
the indices re�ects output factors exclusively related to the Ottoman (Principal-
ity of Serbia) hinterland, as virtually no foodstu�s were imported from the Hab-
sburg Empire. Taking it as a proxy for technological change, shift to three-�eld
system would result in higher yield per unit, increasing the supply and therefore
having de�ationary pressure on the CPI. Same e�ect would be achieved with
improved infrastructure. Particularly visible example of the latter would be the
1880 introduction of railways and ironclads in waterway navigation: less �ashy
would be both the improvement as well as the expansion of the existing network
of roads.
Institutionally, however, the situation is more complex: Marshallian hypoth-
esis implies greater yield per unit resulting from agrarian reform starting in
1830. Production e�ciency net gain would result from a shift from absentee-
landowner estates to freehold homesteads. Conversely, intense net immigration
in Serbia lead to a structural shift from pastoral to �eld crop cultivation. The17Faroqhi (2008: 207) calls it the �sta� of life� in the Ottoman context.
Real Income in Belgrade in the Long Nineteenth Century 36
010
020
030
040
0
1 2 3 4 5 6 7 8 9 10 11 12month
hogsskinny median hogsskinny
Figure 5: Seasonality in pork prices. Evidence for pre-refrigeration �hog cycle�.Source: collected original data for Belgrade (see Appendix).
severe deforestation that followed would result in in�ationary pressure on ani-
mal and animal-derived commodities, especially with respect to pork. Reduction
of forests lead to higher premium on input factor of feed: readily available oak
acorns had to be supplanted entirely. Concurrently, increased net immigration
in addition to agrarian reform necessitated delineation of village as well as of
now private properties: land within as well as between rural settlements. The
result was again premium on input for livestock yet better monitoring and hence
higher yield in crop productions. Indeed, all throughout the period (1842-1908),
there is an abundance of various decrees rede�ning old and establishing new
rural communes.
On the demand side, however, prices were likely to be in function of �uctuation
in urban population and its income. The population of Belgrade went from a low
point of 5,000 immediately following the destruction of two uprisings (1804-1815)
to circa 30,000 in 1878, reaching 80,000 in 1905. The continuous increase belies,
however a dramatic drop in 1862: at the time when city population hovered
around 18,000, upwards of 900 houses (circa 6000 inhabitants) were abandoned
by its Muslim residents, most never to return. The structure of its nominal
income changed, too: all throughout the period, but tapering towards the end,
part of the increase came from skilled immigrants from Austria, laboring in all
trades as well as the administration of the Serbian order. On other hand, the
population that left the city in 1862 were skilled tradespeople, former landowners
Real Income in Belgrade in the Long Nineteenth Century 37
0.5
11.
5
1 2 3 4 5 6 7 8 9 10 11 12month
bread median bread
Figure 6: Bread prices. Possible evidence of institutional moderation. Source:
collected original data for Belgrade (see Appendix).
and all o�cials of the Ottoman order, save for the military which departed
in 1867. Supplanting in part the Ottoman demand, a decade later, 1876-1878
Belgrade served as a staging area during the Serbian-Turkish war of 1876-1878.
Upward shift in population as well as skill level would be strongly in�ationary.
Within the con�nes of present indices, de�ationary pressure could possibly result
from a shift in preferences, which would severely undervalue the indices. No such
shift occurred, as there is no evidence any of the commodities in the index are
inferior goods.
More signi�cant, however, is bias due to capturing di�erent stages of price �uc-
tuation. Primary commodities tend to be strongly cyclical . This is to say that
the basket price for commodities in years where some months are unavailable
will be under- or over-valued depending on what point of the cycle.
Overall, Belgrade experienced a period of de�ation in 15 years following 1861.
The highest month on month de�ation was in 1864 for total CPI levels, possibly
re�ecting a demand shock in the reduction of both overall as well as skilled pop-
ulation following the Muslim exodus in 1862-1863. The total CPI reaching 1843
level in 1878, incidentally the year when the di�erence between the two indices
was highest, possibly re�ecting the shock of 1876-1878 wars � excess supply of
war materiel de�ating non-food items, while a surge in population (Belgrade
as a staging area for military) re�ected in in�ating food prices. Indeed (�gure
2) highest mean month-on-month change was in the year 1879. CPI food levels
Real Income in Belgrade in the Long Nineteenth Century 38
01
23
4
1 2 3 4 5 6 7 8 9 10 11 12month
wine median wine
Figure 7: Seasonality in wine prices. Evidence of explosive trend. Source: collectedoriginal data for Belgrade (see Appendix).
appear to have become more volatile towards the end of the century. Whatever
moderating e�ect the introduction of national currency may have been, it was
apparently largely absorbed by other factors such as rapid population growth.
After the crisis in late 1880s (1887 being a particularly scarce idea, with few
available commodities), the later period is one of relentless growth, albeit with
increased volatility, as noted: 1880 saw a mean month-on-month gain of 30% for
CPI food levels, while 1895 saw a reduction of some 22%.
No summary of variables a�ecting price levels is complete without highlighting
shocks: systemic, such as the drought of 1862, or idiosyncratic such as the phyl-
loxera infestation of grapes in eastern Serbia in the late 1880s. The epidemics
had a devastating e�ect on the local economy, comparable by some (Ljusic) to
the Irish potato famine of the 1840s, grape harvesting and wine producing being
the principal market (cash crop) activities in the region. The e�ect on Belgrade
was on of the a move away from mean stationarity with a long-term explosive
trend (Figure 7).
While no formal decomposition is likely to capture shifts in CPI levels in their
entirety, nonetheless changes in �gure 3 (CPI levels) do lend themselves to some
of the approaches outlined above. The results thus obtained indicate a 4.28
increase on the base level of October 43; for food CPI the increase is exactly
three times. Without formally interpolating the time period for which the data
is missing, the CPI change year-on-year was 4.86% and 1.4% respectively. The
Real Income in Belgrade in the Long Nineteenth Century 39
rate of change, however, varies tremendously between decades: remarkably, it is
highest in the 1840s, the decade when political institutions were at their most
stable for the entire century. This, however, might well be due to absence of
data save for three years: 1843, 1844 and 1849, both within and between years.
Nonetheless, a possible institutional explanation for such a drastic change is
o�ered in the tremendous political change: the 1840s accelerated the process of
institutional impersonalization, that is, the codi�cation of political rules necessi-
tated a tremendous increase of paid bureaucrats, as per the Serbian government
project. Capital moving from Kragujevac to Belgrade in 1842 lead to Belgrade
becoming the center of both the Serbian and the local Ottoman state. The in-
evitable rise in expenditure, as per bureaucrat pay, may have well resulted in a
drastic increase in price level: the 2.70 times (2.73 for food) increase from 1843
to 1849 was not replicated again until 1880 and 1903 respectively.
Following Lucas' dictum that prices re�ect all available information, it would be
interesting to examine in detail the shift in CPI levels with respect to changes
in population income. CPI levels per decade summarize the long-term trend
neatly: increased volatility in both indices, but higher still in CPI food levels
as the period drew to a close. Higher CPI levels are not necessarily a proxy for
net welfare loss: as noted above, rise in income can be a demand-side driver of
in�ationary pressure.
Pamuk (2004) explains the Ottoman wage �uctuation as largely a monetary
phenomenon: �rst part of the great continental devaluation of 17th century up
until delibare silver currency devaluation starting in 1805. in�ation is a mone-
tary phenomenon even historically, in the age of �hard� currency, i.e. money a
function of underlying commodity, the precious metal. Increase in money supply
would have an in�ationary e�ect: prior to minting �rst coins in 1879, the change
in monetary supply would exclusively re�ect the change in terms of trade.
The variance in monthly income actually increases with the introduction of dinar
as the exclusive national currency in 1879, as well as concurrent metricization.
The shift to the then-western (Latin Monetary Union) standard for coins (5
gram .835 purity silver franc) did not lead to welfare gain. This could be part
explained by the fact that the money was already homogenous in one crucial
aspect. In spite of the existance of a number of di�erent coins used in trade,
the imaginary gross was the uni�ed unit of account. The introduction of dinar
as the sole legal tender did not reduce price volatiliy. Month-on-month change
Real Income in Belgrade in the Long Nineteenth Century 40
−.5
0.5
1in
flatio
n
1860m11865m11870m11875m11880m11885m11890m11895m11900m11905m1monthly
Figure 8: Monthly in�ation as change in CPI, 1860-1905. Source: collected original
data for Belgrade (see Appendix).
actually increased for the wholesale (CPI) index, with the mean in�ation for
period following 1880 being at 1.7%, with the 1.3% being the value for the
previous period. Given the existance of gros as the unit of account, the change
is not actually signi�cant.
4.6 Temporal aggregation. Monthly data in formal analy-
sis.
The summary of �uctuation given here for Belgrade given here are published
for the �rst time. Series for Serbia have previously been published both by the
local government o�ces as well as Zundhaussen in 1989. The argument for the
use of monthly data is threefold. The �rst advantage (1) lies in evaluating the
periodicity of underlying commodities. Formally, the Laspeyres index is a linear
transformation of a bundle of commodities in time. As noted, the time series thus
establish show evidence of classic �hog cycle� periodicity; for an example, see
the graph below. Table 10. MA for mutton, beef and pork. (Archives of Serbia,
Archives of Belgrade) Table 11. MA for grains. (Archives of Serbia, Archives of
Belgrade)
In seeking to establish long-term trends, annual data is both necessary and
su�cient (Pamuk, 2004, p. 544). However, evaluating the monthly periodicity is
vital to better identi�cation of annual prices, for two reasons. Namely, a tool as
Real Income in Belgrade in the Long Nineteenth Century 41
simple as a simple arithmetic mean of twelve monthly series has the bene�t of
capturing one entire commodity cycle, giving a better estimate for real income in
the year than a price which could be from any point in the cycle. Thus, having
just one price from a year could misidentify a price by as much as 50% (see
graph below), therefore leading to a signi�cant over- or under-evaluation of the
real income on the annual basis. Furthermore, a time series involving disparate
annual prices is likely to include disparate errors. Any time series neccesarily
has �noise�, or error by imprecision; but as noted, the bene�t of a single source
series is that the disturbance term (the error) is likely to be systemic. Annual
series, from di�erent sources, not only capture the commodity cycle at di�erent
parts of the cycle but also allow for entirely disparate errors, introducing a
further element of stochasticity in the noise. Furthermore, monthly data as such
allows for evaluating volatility in real income, taking variance in time series as
its proxy.
Measuring volatility as such is an important tool in forecasting, which had
profound consequences historically: the evaluation of commodity prices at the
end of 19th century had as a direct consequence the introduction of various
commodity derivatives, thus spurring �nancial innovation and allowing for the
agricultural commodity producer to hedge on future income streams. No such
mechanism came into being in neither Belgrade nor Serbia, absent the volatility
measurement: which is all the more remarkable given that systematic e�orts at
collecting price data are fairly early and contemporaneous with many such ef-
forts in comparatively more developed economies of Western Europe (ie 1843 as
the earliest mandated collection of market prices). The context of this research
is a good example on why volatility as such is important in economic history
analysis: measuring volatility allows for measuring the e�ect of the introduc-
tion of national currency. This is applicable for a wide range of situations in
economic history, and not just in terms of pre-WWI �solid money� monetary
era. In summary, monthly real income series allow for a greater precision, which
allow for greater insight in formal evaluation.
Second principal contribution of monthly data used is that the underlying com-
modities are necessarily strongly cyclical formally, and may in fact be pro-
cyclical economically, in other words, a strong correlation could be posited be-
tween the movement of standard-of-living indices and the business cycle. The
correlation is intuitive in the context of contemporary economies; however, it is
less so in the ambient of a developing urban economy. That is to say, the principal
Real Income in Belgrade in the Long Nineteenth Century 42
challenge to the argument in favor of strong correlation between standard-of-
living indices and economic growth lies exactly in the urban nature of data.
That is, a downturn (leftward shift) in prices of agricultural commodities leads
to a gain in real income, ceteris paribus. However, the ceteris paribus cannot
hold as nominal wages themselves were strongly correlated to the shifts in agri-
cultural prices: the unskilled labor used in construction was used in construction
of houses or storage spaces of commodity merchants (grains, pork, livestock) or
in physical transport of goods � ie manual carriage of sacks of grain from the
port of Belgrade to a storage space. Having stated the theoretical importance of
monthly evaluation of unskilled real income, it should, however, be noted that
the assumption of correlation between a trend in real income and total output
cannot be checked empirically, as no estimates for total output during the period
in Serbia exist.
But while construction and transportation are industries that are canonically
pro-cyclical, further note should be made of the automatic stabilizers in skilled
wages: the labor incomes of government o�cials, ie administrative clerks, mil-
itary sta� and teachers. With a region (Serbia) that remained strongly rural
in spite of the change of its political status throughout the period, there is ev-
idence of automatic stabilizers aligning with the trend in economic grown in
the medium-run, ie the mandated reduction of teacher's wages in the 1890s
(reference).
4.7 The signi�cance of central political authority in eval-
uating real income.
To understand the mechanism of alignment, it is worth summarizing the three
principal income streams of the emerging Serbian order, the Principality/King-
dom of Serbia. (1) Fixed fee as poll tax on all male inhabitants, subject to
certain restrictions. ; (2) Customs duties and fees on all goods entering or leav-
ing (including transiting) the Principality; and (3) Rent income on various state
assets. A recession triggered by a shock in the dominant, primary sector (ie a
draught) would reduce all three income streams, namely, by reducing the tax
base in (1) by pushing a still greater number of citizens in the �poor� category
for which the poll tax was waived, (2) reducing the tra�c of goods (although,
not neccesarily the duties on transit, absent a global recession) and (3) lowering
the income on rent, absent a deep and developed capital market to o�er insur-
Real Income in Belgrade in the Long Nineteenth Century 43
ance. Absent the savings from the three income streams from previous years,
this neccesarily leads to a medium-run reduction in the wages which are a part
of government expenditure (ie the said administrative o�cials, military sta�,
teachers). Therefore monthly and quarterly change in real income can serve as
a proxy for output change in a given year.
The example of reduction of base pay of teachers in 1890s is all the more il-
lustrative as it refers to a period where the state as an organization had access
to international capital markets, allowing it to borrow to smooth consumption,
as evidenced by two loans from the Imperial Russian government in the late
1870s (reference). Nonetheless, the skilled wages, especially in the earlier period
show a remarkable persistence (reference): thus, the posited mid-run alignment
would take place in refusing incremental raises rather than reducing the base
wages; the net e�ect, however, is a reduction in real income following closely the
trend in output. While it did account for base pay, tis research did not include
the individual petitions for raises, as it would have been impossible to compre-
hensively cover all petitions for Belgrade o�cials in the period: therefore, the
hypothesis remains theoretical.
A �nal caveat concerns the contemporaneous relevance of real income as proxy
for economic growth in a strongly agricultural, rural economy. The link between
the two would likely be far weaker in a more diversi�ed economy with developed,
deep capital markets, ie the United Kingdom, as the canonical case of indus-
trial revolution. Nonetheless, present-day developing countries with dominant
agricultural sector remain as good examples of the aforementioned relation. In
summary, the importance of monthly changes in real income lies in being able
to use it as proxy for output trend. In spite of the absence of empirical data
allowing for empirical testing of the correlation, the theoretical link remains
robust.
4.8 Real income as proxy of output growth.
By way of greater precision (general case) and the possible use as a proxy for
economic growth (particular to subsistence economies), monthly time series for
real income provide greater depth for institutional development and therefore
insight in wider social and political events. The causation between the two is,
however, fraught with danger of using formal evaluation to impose a particular
institutional interpretation of social history, at the least assuming a high degree
Real Income in Belgrade in the Long Nineteenth Century 44
of material determinism which might be entirely absent. Nonentheless, it is
worth noting that the converse thesis is false as well: that political, or more
widely social events are entirely independent of the underlying economy. While
the complex interaction is widely explored in the context of new institutional
economic history, this research is able to o�er further empirical evidence on the
complex connection and thus further validate the use of monthly data.
An example of the possible application of the evaluation of monthly data on
Belgrade is the case of the Belgrade riots and bombardment of 1862. The con-
ventional narrative of the event underscores an altercation between an Ottoman
soldier and a boy at a water fountain, followed by a wounding of a child water
carrier, and the death of two Serbian police o�cers, resulting in riots engul�ng
the majority-Muslim part of the town, bombardment of the orthodox quarters
and ultimately having as a consequence the evacuation of some 6,000 people,
mostly Muslim, upwards of one-third of the city. (Hristi¢, 1989 [1921], p.35).
The incident took place on Jun 15 , and the city was in an o�cial state of state
of war from Jun 18 to Oct 9, 1862. (ZZ XV, p. 200) The monthly data for the
real income of unskilled workers in Belgrade bears out the evidence of draught
in the months prior to the June events: the motivation for the altercation is
thus clearer, as is the monetary incentive for looting and rioting of the Muslim
quarters (see also M. Jovanovi¢, 2006). See graph below. It should be noted,
nonetheless, that the downtick in real income might not indicate drought exclu-
sively, which indicated in further anecodotal evidence. Nonetheless, the change
in monthly real income, in this case illustrates well the possible application of
monthly data in attempting to assess political, or wider social, phenomena.
Real Income in Belgrade in the Long Nineteenth Century 45
5 Conclusion. Failure of mandated institutional
change.
In the internal politics of the country, I followed a clear and de-
�ned direction, to give Serbia the institutional shape and bene�t of
a modern European state. A state born in the 19th century can-
not do di�erently for its sake, but be lead to progress, culture and
civilization regardless of how many sacri�ces it entails.18
The abdication letter of King Milan, emphasis added. (Feb 22,
1889 OS, ZZ XLV, p.66).
Having observed a divergence in real incomes, another, related e�ort has been
to understand underdevelopment. Examining the real income for a �gemstone
in the [Imperial] ring� (Çelebi), Belgrade, allows for evaluating strategies of
development. Subject to caveats, real income o�ered a way to measure the e�ect
of a deliberate, sustained e�ort to spur economic growth.
One possible explanation for the phenomenon of �Ottoman drift� is institutional.
Kuran (2011) ascribes the �long divergence� of the Ottoman empire to institu-
rional features of Islamic law. Rather than institutional hypothesis deserving of
further explanation is that the parallel institutional19 change continued over the
long nineteenth century. The real income was su�ciently a�ected by the polit-
ical order as to change in a similar way given the similar wholesale adoption
of political and economic (and social) institutions from contemporary perceived
Western models.
Nevertheless, by the end of the period, and in spite its rapid growth, the country
around Belgrade is still a largely rural land, with urban-rural ratio and literacy18Compare the observation made by F. Kanitz in 1871, while travelling in the still Ottoman,
soon-to-be southern Serbian towns: �there were pashas of Nis and So�a, as well as mutassarifof Pristina... who assured me, Turkey will soon be no di�erent than a state ruled alla franca.�
19The institutional analysis is based on a somewhat contentious de�nition of institutions.One common approach is to de�ne institutions as de�ned as the rules of the game, the patternsof interaction that govern and constrain the relationships of individuals. Institutions can beformal (formal rules, written laws) and informal (norms of behavior), together with respectiveenforcement mechanisms (North and Weingast, 1989). It should be noted that the de�nitionof institution-as-rule is widely accepted, but not universal. For example, Greif (2006) de�nesan institution as a system of rules, beliefs, norms and organizations that together generate aregularity of social behavior. In Greif's argument, this de�nition is inclusive of institution-as-a-rule but allows for motivation to follow rules at the center of analysis, as well as formallyembracing of organizations as �part of institutions, rather than players in a political gamethrough which institutions are established�. This research however, will rely on a more nar-row de�nition given by North, but with the view that a di�erent de�nition could be used ifrequired by actual research results � allowing for a change of terms.
Real Income in Belgrade in the Long Nineteenth Century 46
level second only to European Russia, Turkey and Bosnia in Europe. While this
has not been disputed, previous authors (Palairet, Ljusic, Stojanovic), frequently
relying on macroeconomic stocks such as the literacy rate, have argued that the
issue was variously either the importance of asserting political authority (at
expense of growth), strategic politics or the retardation, especially deliberate,
in adopting western institutions.
This research used a di�erent methodology, to arrive at a di�erernt conclusion,
by combining formal analysis of collected data with a review of institutional
narratives. In the process of evaluating empirical evidence, no single, undisputed
narrative has emerged, or indeed can emerge. While the stochastic �uctuation
of real income series does not lend itself to any single narrative, the context of
institutional change o�ers a path. 20
The method of development became an end in itself. The central political au-
thority, in Belgrade and then in Istanbul, gradually embarked on complete re-
placement of Islamic with self-perceieved �Western� institutions, a total trans-
formation of the local economy and society. In spite of both a limited reach
and limited means to impose its authority, the institutional �trickling down� is
undeniable. Both Istanbul and Belgrade (Stojanovic, 2008) had cinemas at the
turn of the century, and trams that closely followed. European dress eventually
made it to the widest strata of society, European hats replacing fezes which
in turn replaced turbans. Thus, a powerful quanti�able in�uence on the local
economy becames evident..
The vital link between political authority and the evaluated real income rests
on the sources of political authority as sources of labor demand. A direct ex-
ample would be price controls on bread, mirroring the classic narrh system in
Istanbul. But the e�ect was often less obvious: for instance, the emergence of
local, Western-modelled bureacracy raised the demand for unskilled labor, i.e.
carriers or masons. With some caveats, it might well be that the political elite
found exchanging hats costly enough to pay masons or laborers more.
Therefore, as a top-down political e�ort at a wholesale change of economic in-
stitutions, the strategy of Westernization as institutional modernization in the
former Ottoman empire has been a quali�ed failure, quali�ed with respect to
absence of convergence with urban real income in North-western Europe could20Indeed, the institutional context was often (over)emphasized in economic literature on the
Balkans, cf. Palairet.
Real Income in Belgrade in the Long Nineteenth Century 47
imply that the failed. This approach contrasts with the argument that the origi-
nal institutional base of Islamic law was itself less conducive to growth, as Kuran
(2011) would imply. The last feature is especially signi�cant given the historical
values. The research illustrated that the nominal income in the second-half of
17th century Belgrade is among the highest in Europe. It should be noted that
the analysis here is limited to economic institutions, e.g. organizatin of produc-
tive enterprise. Some authors have recently suggested (M. Jovanovi¢, 2008) a
more complex, comprehensive failure of westernization-as-modernization as, in
the context of urbanization.
In summary, institutional change yielded no gain in real income, in a trend
parallel to Istanbul, ironically, the contemporary paradigm of political change
to be avoided. The introduction of uni�ed national currency did not reduce
price volatility, but actually increased it. While both divergence (with respect
to Northeast Europe) and absence of divergnce (with respect to Istanbul) exit,
nevertheless, there is evidence of increasing premium on skilled urban labor,
related to contemporary European trends. But the principal point remains. If
Belgrade is accepted as the paradigmatic example of transition from Ottoman
to Western order, then there is little ground for asserting the relative lack of
growth incentive in classical Islamic, or Ottoman, institutions. Rather, it is the
strategies of westernization, political approaches to instututional �moderniza-
tion�, that need to be reviewed.
Real Income in Belgrade in the Long Nineteenth Century 48
6 Complete data
6.1 Narrow band. Price lists and unskilled wages.
7 References
7.1 Primary sources
7.1.1 Archives of Belgrade (AB), Governmnet of the City of Bel-
grade (UGB) collection.
1. 15-day reports to the Commercial Court, 1843-1844, 1849, 1861: K4 F13;
K5 F213: K5 F215; K5 F232; K6 F35; K6 F310; K6 F320; K6F321; K6 F382;
K6 F375; K27 1861; K27 1703; K28 2023; K29 303; K29 003; K29 009; K 569
FXXII; K570 001; K570 002; K570 004; K570 005; K570 017; K570 020; K570
110; K570 150; K570 162; K570 177; K571 F101.
7.1.2 Archives of Serbia, O�ce of the Prince (KK) and Ministry of
Education (Mps)
AS KK5 147a, June 25, 1837.
AS MPs F XXXI 22/93
7.1.3 Archives of Serbia, Law Collection (LC; Zbirka Zakona, ZZ).
ZZ I p.114, Decree establishing the Enigineering School, June 19, 1846.
ZZ II p.261, Pensions for Widows and orphans, Oct 18, 1843, also con�rmed on
Nov 23, 1845.
ZZ II p. 82, Decree to Ministry of Internal A�airs establishing the Model Farm,
Dec. 12, 1849.
ZZ VI p. 42, Decree to the Ministry of Finance concerning the Minstry of Justice,
Aug. 3, 1851.
ZZ XII p.71, Oct 21, 1859.
ZZ XV p.130, Wages for engineers. Feb 16, 1880.
Real Income in Belgrade in the Long Nineteenth Century 49
ZZ XV p.73, Law on Economic-Statistical O�ce of the Ministry of Finance, Apr
18 1862.
ZZ XVII, p.91, Military, Mar. 20, 1864. NB: Gross calculated at 12 per taller
ZZ XVII p. 294, Doctors, Dec. 15, 1864.
ZZ XXX p. 263, Gymnasium established, Oct 09, 1839.
ZZ XXX p. 271, Wages for the Band, Dec 12, 1839.
ZZ XXX p.1, Full text of the 1835 "Sretenje" (�Candlemas�) constitution., Feb
15, 1835.
ZZ XXX p.61, Composition of Garrison Army, May 29, 1839.
ZZ XXXI p. 1, Military regulation, Jan 10, 1845.
ZZ XXXIV p. 142, Law on the Higher School (College) for Ladies, Jan 19, 1879.
ZZ XXXV p. 127, "Law regulating the position of technical construction engi-
neers" Jan 18, 1880.
ZZ XVIII p.123, Law regarding the distribution of o�cials of construction pro-
fession
ZZ XXXV p.124, "Law establishing the Military Academy", Jan 19. 1880. Re-
places the contemporary constitution of Artillery School (May 11 1850).
ZZ XXXVI p. 539, Law on Teacher's Wages. Mar. 31, 1881. Note: law contains
additional provisions for hardship allowances/raises, not applicable to Belgrade
(insert source here).
ZZ XXXVI p.608, April 5, 1881. Law on Administration and its Sta� Expense.
ZZ XXXVII p.40, Law on Lower Agricultural School, Sep 5, 1881.
ZZ XXXVIII p.299, Law on army composition. Jan 3, 1883.
ZZ XL p. 220, Law on Gendarmerie, June 11 1884. Note: periodic raise given,
noted.
ZZ XLVII p.112, July 26, 1886. Law establishing the Ladies' Junior High School
ZZ XLVII p. 168, March 31, 1892. Law on State Railways.
ZZ XLVII p.370, May 1, 1892. Revisors for Chief [Budget] Control [O�ce].
ZZ XLVII P.549, December 18, 1892. Regulation concerning the State Lottery
of Serbia.
Real Income in Belgrade in the Long Nineteenth Century 50
ZZ XLVIII p.43, February 29, 1892. Law establishing the State Cattle Institute.
ZZ XLVIII p.85, Mar 27, 1892, Law establishing the Trade School.
ZZ L, p. 535, Law changing and amending the law on army constitution, chang-
ing laws of November 1886 and additons of April 1890. Dec 20, 1895.
ZZ L p.351, King Milan's appanage. ("Count of Takovo") April 26, 1895.
ZZ LI p. 449, Law changing and amending the law on tax manaagement, tax
councils and tax collectors. December 16, 1896.
ZZ LIII p. 122, Law on State Chamberlains, July 3 1898
ZZ LIII p. 143, Law on Fond Management [O�ce], July 8, 1898.
ZZ LIII p. 203, Law on High Schools, July 14, 1898.
ZZ LIII p.?, November 30, 1898. Engineers, Architects.
ZZ LIII p.306, Law on National Schools, July 26, 1898. Note: di�erent pay based
on gender of the teachers.
ZZ LIV p. 17, Law changing the Law on State Railways, January 5, 1899..
ZZ LIV p.752, Law chaning the law on Military, Sep 28, 99.
ZZ LIV p.758, Law charning the Law on National Schools, October 6, 1899. note:
female teachers cannot administrate schools if there are male teachers present.
ZZ LIV p.170, Law on Customs, January 23, 1899..
ZZ LVI p.91, Law changing and amending the the Law on Judical Branch,
January 26, 1901.
ZZ LVI p. 155, January 27, 1901.
ZZ LVI p.39, January 15, 1901. Law on State Statistics O�ce.
ZZ LVI p.53, January 19, 1901. Law on Judicial Branch.
ZZ LVI p385, April 22, 1901. Law establishing the Military-Medical (Sanitation)
School
ZZ LVIII p.922, December 16, 1903. Regulation of Telephonists.
ZZ LX p. 92, February 27, 1905. Law establishing the Belgrade University
ZZ LX p.21, January 17, 1905. Law changing and ammending the law on medical
(sanitation) profession.
Real Income in Belgrade in the Long Nineteenth Century 51
7.1.4 Archives of Serbia, printed material:
1. Drºavopis (State Annals). Special editions of Principality of Serbia Press,
Royal Serbian Press. 1862-1889. Volume 1: 1862; 2: 1863; 3: 1864; 4: 1865; 5:
1866, 1867; 6: 1868; 7: 1869; 8: 1870, 1871; 9: 1872, 1873, 1874; 11: 1875, 1876,
1877, 1878; 12: 1879, 1880; 14: 1881, 1882; 15: 1885, 1886, 1887; 16: 1888; 18:
1889.
7.1.5 Archives of Serbian Academy of Sciences and Arts:
1. Historical Collection (�Istorijska Zbirka�) 842: Contract, Nov. 24 (OS), 1805.
Archives of Serbian Academy of Sciences and Arts, Library, printed material:
2. Price Statistics of Produce in the Kingdom of Serbia, Volume 1: 1890-1895
(1896); Volume 2: 1896-1900 (1901); Volume 3: 1901-1905 (1906).
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Clark, Gregory. A Farewell to Alms: A Brief Economic History of the World.
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Clark, Gregory. �Farm Wages and Living Standards in the Industrial Revolution
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A Chronology of Political Events.
1790. Austrian forces withdraw from Belgrade. Terms of Austrian-Ottoman peace
recognize local autonomy for Orthodox population: henceforth, village elects
notables (�knez�) to collect tribute and taxes for both the local landowner and
the central Ottoman government.
1801 In a development mirroring some other Ottoman provinces (Algiers, Tunisia)
local janissary elite seizes power from pasha, the lawful representative of the
central government. Tribute and tax collection becomes haphazard with
extensive violence throughout.
Aiming to curb possible opposition, janissaries slaughter most of Serb notables
previously order to gather for consultation.
1804, Feb. 15 The conventional start of the First Serbian Uprising. At a meeting of Serbian
notables (�knez�, lit. �prince�) Karadjordje (�Black George�) Petrovi¢
announces the start of the armed struggle against the dahis of Belgrade.
Uprising, initially supported by the central goverment (the Porte), quickly
turns in a wholesale rebellion against the Ottoman rule. Numerous battles
with the central government ensue.
1807, Dec. 12
Real Income in Belgrade in the Long Nineteenth Century 56
Karadjordje elected the leader (�Voºd�) of Serbia, followed by the
establishment of central administration organized in six ministries and based
in Belgrade. Belgrade Great School, the �rst secular institution of tertiary
education is established in 1811.
1813, Spring Following the withdrawal of Russian troups, the rebels su�er extensive
setback. Belgrade is itself is recaptured by superior Turkish forces, defenders
executed en masse.
1815 Following an unsuccessful rebellion in the previous year, Second Serbian
Uprising brings a string of successes to the rebels, after a limited engagement
of several months. Tacit recognition of Milosh Obrenovic as the great prince
and a promise to address Christian woes.
1830, 1833 First three hatt-i-serifs arrive in Serbia, a�rming Milosh as the supreme ruler
of all non-muslem population in Serbia (orthodox Serbs, Jews) with exceptions
for Belgrade fortress and city �up to the trenches�, as well as foreign residents
as per Ottoman Capitulations. All Muslim landowners were to abandon their
�efs in return for an annual stipend. The land is to become the property of
those who tile it, with abandoned or unoccupied land to be distributed at the
discretion of the Prince. Many move to the city, some departing Serbia
altogether
1841 Prince Michael moves his residence from Kragujevac to Belgrade.
1846 Ministry of Agriculture established in Istanbul.
1850 Ottoman Commerce Law
1856 With the conclusion of the Crimean War, Principality of Serbia as an Ottoman
vassal state recognized as being under the �protection� of all signatory Great
Powers (UK, France, Austria, Russia, Sardinia).
1858 Agricultural Code enacted in Istanbul.
1862, June 15 In the wake of a prolonged drought in and around Belgrade, a Christian child
is shot by an Ottoman soldier at a local public water fountain, Chukur
(�ukur, Çukur). Rioting ensues throughout the city, with various business and
residential parts of Muslim quarters set ablaze, followed by the bombardment
of Christian quarters from the fortress. Following an ad-hoc conference, all
Muslim civilian population of Belgrade is to be evacuated. However, six
Ottoman military garissons remain in as many towns, Belgrade included.
Real Income in Belgrade in the Long Nineteenth Century 57
1867, Apr 18 Following extensive negotiotiations in the wake of the Chukur Fountain
incident, remaining six garissons are withdrawn from Serbia, principality
nonetheless remaining an Ottoman suzerainity. Michael III Obrenovi¢, the
Prince of Serbia, is now the undisputed sovereign of both the population and
territory within the principality. De facto independence. (Apr 6, 1867 OS).
Hristi¢ (1923) (1989), p. 20.
1868, May 29 Prince Michael is assassinated in a forest adjacent to Belgrade. Motives remain
unclear up to present day
1870 Ottoman Civil Code based on the French model and sharia enacted.
Ammended subsequently (1877).
1876 Serbia declares war following the uprising in Bosnia and Bulgaria against the
Ottoman rule, Belgrade serving as a staging area for both the regular troups
and various Balkan and Russian volounteers.
1877 Jan Following a series of serious military defetats, Prince Milan ask for peace on
the basis of status quo ante.
1877 July Russian imperial government, preparing for a military intervention in support
of Bulgarian insurgents, urges the reopening of hostilities with the Porte.
Fighting, with extensive Russian support is more succesful, with Serbian
government recapturing Nish (Ni²) on December 28, major urban center and
the capitol of the pa³alik due south from the Principality
1878, July 13 Conclusion of the Congress of Berlin. Formal independence recognized, in
addition to extensive territorial gains. Formal independence of Serbia and
Romania recognized. Bulgaria becomes an autonomous principality along the
lines of former (1830) Serbian autonomy, in personal union with Eastern
Rumelia, another autonomous region southeast of So�a. Serbia acquires 13,000
sq. Kilometers, and additional 350,000 people.
1882, Mar 6 Serbia is declared a kingdom, with explicit Austrian-Hungarian support. In
return for its support, Austria-Hungary requires Serbia to co-ordinate its
foreign policy, as well as to construct a railway connecting Belgrade and
Ottoman border, via Ni².
1885 Nov Serbia declares war on Bulgaria, aiming to prevent the attempt at formal
uni�cation of Bulgaria and Eastern Rumelia, ending in a complete rout of
Serbian forces. Peace established on the basis of status quo ante at the
pressure of Austrian-Hungarian government.
Real Income in Belgrade in the Long Nineteenth Century 58
1903, May 29. King Alexander and his spouse are assassinated in the Royal Palace in
Belgrade by a group of military o�cers belonging to Black Hand secret society.
Peter Karadjordjevic, grandson of Karadjordje, is invited to assume the
Serbian throne.
1908 Young Turk Revolution. Following the rebellion of Ottoman armed forces
demanding the return of 1876 constitution, Austria-Hungary formal annexes
Bosnia-Herzegovina citing overall Ottoman instability, over protests by both
the Serbian and Russian governments.
1914, June 28 Archduke Ferdinard, the heir to the Austian-Hungarian throne, is assassinated
in Sarajevo by a member of a Yugoslav nationalist group linked to the Serbian
Black Hand. The Vienna government delivers an ultimatum to Serbia, which
accepts all points but one, wherein Austrian police is to prosecute suspects on
Serbian soil without interference from local authorities. On July 28,
Austria-Hungary declares war on Serbia, followed by a chain reaction of war
declarations resulting in the start of First World War.
B Metric conversion table of units
Remarkably, no comprehensive, formal guideline for standardization of units has
previously existed: annual summaries used by Zundhaussen, for instance, are
taken from the Statistical O�ce report that was already metric. One of major
challenges for the research was, therefore, standardization, not just metric, but
within Ottoman units as well. Namely, the o�cial Ottoman standardization
of 1844 took place at the time when Belgrade is still in a period of diarchy.
Subject to all central, Ottoman legislation, this would imply the city would use
the new, standardized value of okka at 1,282 kg. Nontheless, the value used both
by authors in the period (Karadºi¢, 1895 [1850]) and the statistical o�ce is the
previous value of 1,280 kg. There is further evidence that the standardization
took place at the time when vernacular measures were already diverging: a side
note in a decree banning brideprice in 1834 (ZZ5, p.21) mentions �the Stamboul
kantar [weight]�. The di�erence between the measures is nontrivial given the
precision of wholesale transactions in the period. For instance, the contract
supplying barley and �our to the Belgrade Fortress dated August 1805 speci�es
exactly 38428 okkas of �our and 9752 okkas of barley (ASANU HC 842). Based
on the contemporary accounts, therefore, the research has used the Belgrade
standard, thus explicitly establishing that the Ottoman standardization of 1844
Real Income in Belgrade in the Long Nineteenth Century 59
did not apply to the city.
Belgrade metric
1 dram 0.0032 kilogram
1 pound, customs 0.5 kilogram
1 pound, Viennese 0.5601 kilogram
1 oka 1.2800 kilogram
1 cent (kvintal) 56.0060 kilogram
1 tovar 1280 kilogram
1 par 2 pieces
1 akov 56.5890 liters
1 liquid oka 128.6114 liters
1 stopa 0.3161 meter
1 ar²in 0.6660 meter
1 rif 0.7776 meter
1 day of plowing 5754.6420 meter squared
1 hvat 6.8210 meter cubed
note: Viennese pounds, akovs and hvats rounded to the fourth decimal.