Investments and Changing Labour Productivity in Timber Floating:

Abstract

The aim of this article is to examine the change in labour productivity of timber floating on tributaries of northern Swedish rivers between 1930 and 1960. During this time, timber-floating operations were still relatively widespread but were put under economic pressure due to rapidly increasing labour costs and decreasing timber dimensions. This study examines various factors that could conceivably explain these changes in labour productivity in timber floating on the tributaries of the Ume and Vindel rivers. The results show that during the 1950s a partial phase-out of timber floating on the tributaries had a very small effect on labour productivity. Thus the combination of investment in the existing floatways and changes in the volumes of timber is the factor which best explains differences in labour productivity among different tributaries. Timber floating on the tributaries was influenced by annual variations in natural conditions, but since the relationship between investment costs and changes in labour productivity is significant, it still seems reasonable to draw the conclusion that investment in existing floatways resulted in increasing labour productivity during the examined period. These findings also contribute to the discussion of rationality and expectations as an explanation for investments in existing technologies, particularly in this type of transport system.