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AbstractDoes inequality affect outcomes? To answer, we use the microcosm of Olympic competitions by asking whether a country's level of inequality diminishes its performance. If it does, is it conditional on institutional factors? We argue that the ability of economically free societies to win medals will not be affected by inequality. In these societies, institutions generate incentives to invest in the talents of individuals at the bottom of the income distribution (potential athletes otherwise constrained in the ability to expend resources on training). These effects mitigate those of inequality. The incentives that promote investments in skills across the income distribution are weaker in unfree societies and they cannot mitigate the effects of inequality. Using the Olympics of 2016 in combination with the Economic Freedom data, we find that inequality only matters in determining medal numbers for unfree countries. We link these results to inequality and its effects on economic outcomes.

AbstractThe military occupation of Boston in 1768 shocked the city's labor market. The soldiers, who were expected to supplement their pay by working for local businesses, constituted an influx equal to 12.5 percent of greater Boston's population. To assess the importance of this shock, we use the case of Quebec City, which experienced the reverse process (i.e., a reduction in the British military presence from close to 18 percent of the region's population to less than 1 percent). We argue that, in Boston, the combination of the large influx of soldiers and a heavy tax on the local population in the form of the billeting system caused an important wage reduction, while the lighter billeting system of Quebec City and the winding down of the garrison pushed wages up. We tie these experiences to political developments in the 1770s.

AbstractThis article uses the censuses of 1842 of Canada East (modern‐day Quebec) and Canada West (modern‐day Ontario) to help explain the historical differences in living standards between Canada and the United States. The wage and price data contained in the censuses suggest a gap of 42 percent between Canada East and Canada West. We argue that Canada East was substantially poorer than the rest of Canada and, as it represented such a large proportion of the total population of the initial four Canadian provinces (over 35 percent), that relative poverty weighed heavily in determining the extent of differences in living standards between Canada and the United States. These findings change the perspective on the roots of the differences between the two countries. We propose that any research agenda trying to explain those differences should focus heavily on Quebec.