As protein malnutrition limits human capital formation and hence productivity growth, the intense controversy over the pattern of convergence or divergence of growth rates across economies can be illuminated by using nutritional status as an additional variable. This question of gender discrimination within the household was particularly decisive for those born out of wedlock. Baten and Murray argue that discrimination against those who were born out of wedlock was extreme during the initial stages of economic development, but became less severe during the second half of the 19th century. Baten also addresses some questions of anthropometric methodology. They find that a one centimeter diminution in adult height meant a 1.8 years loss in life expectancy in 1860 and 1900, and a 1.2 years loss in 1950.
Japan seems to have been an exception in the early period.
The second major project in Baten's research program pertains to the economic history of firms. This factor turns out to be very influential, even when controlling for autoregressive effects. Another hypothesis considered is derived from Krugman s assertion that in periods of rapidly declining transport costs agglomeration effects reinforce industrial activity by positive externalities. Agglomeration effects in firm creation were much more important around 1900 than they are today, and they can be divided into human capital externalities and other agglomeration externalities. In contrast to contemporary evidence, Baten argues that historical data sets on entrepreneurial behavior have advantages for answering many important questions, as tax and business secrets do not hinder data acquisition and do not create selectivity problems.