Lays vs. Wages: Contracting in the Klondike Gold Rush

Abstract

Mine owners during the Klondike gold rush of 1898–1899 used two types of contracts to coordinate workers and their capital: wage contracts and lay (or share) contracts. The key interesting feature of this gold rush was the severe climate and the constraints it placed on the miners. I show that an “off the shelf” incentive model can explain the pattern of contracts, once one understands how the extreme weather environment influenced the behavior of miners.

Citation

Allen, D.W. (2007), "Lays vs. Wages: Contracting in the Klondike Gold Rush", Zerbe, R.O. and Kirkwood, J.B. (Ed.) Research in Law and Economics (Research in Law and Economics, Vol. 22), Emerald Group Publishing Limited, Leeds, pp. 1-15. https://doi.org/10.1016/S0193-5895(06)22001-3