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> for economic understanding it's important to note that these were not the major drivers of growth. Two hundred years of slavery was not a major driver of eco

> for economic understanding it's important to note that these were not the major drivers of growth. Two hundred years of slavery was not a major driver of economic growth? Edit: Serious question, rephrased: do economic historians really not consider slavery a major driver of growth? If so, that would be highly counterintuitive. We're talking about the free labor of ~10 million people over two centuries, in an economy that was almost entirely agricultural.

thedevil 10y ago
It's not that it wasn't significant at that time. It's just that in the long-term, it looks small compared to making the value of the labor of the entire population 100x more valuable.
- eropple 10y ago
  This is true, but most of the economic historians I am aware of also acknowledge that America wouldn't have been in the position to leverage industrialization that it was without the economic driver of slavery. Disentangling them is very difficult and usually smells of a political motive.
  - Shubley 10y ago
    The slave holding states are now the poorest and were under-industrialized even during the Civil war. The correlation between historical slavery and industrialization/modern wealth is negative. Not really difficult to disentangle. And theres Canada.
  - scythe 10y ago
    >Disentangling them is very difficult and usually smells of a political motive. Whereas claiming they can't be disentangled is obviously disinterested. Slavery was the rule, not the exception in the world at the time. The African kingdoms mostly practiced it, the Arabs were infamous for it, Mexico ended slavery in the 1830s after American industrialization was well underway, Russia didn't truly end serfdom until around 1900 as I recall, and then you have India's caste system, so only China is left without slavery in some form? But were they? And why didn't all of these countries industrialize?
    - mcguire 10y ago
      Possibly because they didn't have the large amount of valuable raw materials to process, the way England did from its slaveholding colonies?
lordnacho 10y ago
Normally the story is that you need certain institutions to make it work. Rule of law (contracts, low official corruption), absence of arbitrary confiscation risks (ie the King is not going to suddenly come and grab your stuff), unfettered movement of goods/people/ideas. Generic ideas that allow you to compare across societies. I actually studied economics, and the explanation of how growth arrived does not normally rely on slaves. It tends to focus more on the advent of early parliamentary government (Glorious Revolution), presence of coal in northern England, and advancement of science and technology. There's no absolutes in economic history though, and you might well find an argument that the triangular trade aided the industrial revolution. That's more of a vignette that explains why England in particular might have prospered, rather than an explanation of how growth gets started in general.
- CPLX 10y ago
  I've got a degree in economics as well. There are a few more big ones, including the advent of the joint stock company (or more generally, the ability to effectively pool capital) and the common law, specifically the ability to enforce business contracts. Those two are fundamental.
  - lordnacho 10y ago
    This is a good point, under the rubric "institutions girdling trust". Quite relevant as a set of innovations in the time when people started having to do business with strangers, particularly ones with different ecological positions. You can imagine having lived in agricultural societies there would be a big question of how exactly you're going to have a business relationship with say a factory owner or delivery company. JSC, exchanges, (perhaps central banking as well) and various encounters with credit issues worked out a certain way in the UK, and innovations were copied across many other societies.
    - desas 10y ago
      Didn't the UK mainly copy them from the Netherlands?
mememachine 10y ago
Slaves were expensive, not free (not to say they werent a contributing factor)
- cardiffspaceman 10y ago
  Expensive compared to what? Since this idea is a little counter-intuitive, can you suggest a search or link? From this [0] I can only conclude that owners were paying for value and the price did go up over time, as did the price of cotton, but it looks like it was a good deal. [0] https://www.measuringworth.com/slavery.php https://www.measuringworth.com/slavery.php
  - mememachine 10y ago
    Im not saying it wasnt a good investment for them (im sure it was), but it costs a lot of money not only to buy slaves, but to feed and take care of them.
joshuak 10y ago
An economy is about the volume of cashflow (value flow), not magnitude of wealth. If you have all the money in the world, you will find there is nothing you can buy. While a large number of, not free but very low cost, laborers will build individual wealth for the small percentage of the population who use them, those same laborers do not participate in the economy. So you end up with very large supply and very little demand, little or no reason to innovate, and a stalled engine of growth. Slavery, or even low wage workforce is bad even from the point of view of entirely selfish actors. It erodes the market eventually killing the entire economy. The lesson is, if you want to get rich don't reduce the cost of your labor force, increase the value of your production.
- vernon99 10y ago
  This basically sums up the debate to me. Great summary.
MomentarySanity 10y ago
If you think slavery was the main, or even a large driver of industrial growth, you need to explain the extreme lack of industry in places where slavery was common versus places where there was no slavery. E.g., New England versus the Carolinas, etc.
- baursak 10y ago
  http://www.pbs.org/wnet/african-americans-many-rivers-to-cross/history/why-was-cotton-king/ http://www.pbs.org/wnet/african-americans-many-rivers-to-cro...
  - MomentarySanity 10y ago
    Northern manufacturing bought cotton from slave plantations, yes. As did British mills. However, you'll note that in the absence of southern cotton during the Civil War, these textile mills did not shut down or become unprofitable, they switched to alternate sources of cotton.
mcguire 10y ago
Not an economist, but... I don't think that there is any doubt that slavery provided a great deal of the early economic growth in the American south. (Weirdly, I was just reading an article that suggested that slavery itself did not catch on in the Virginia colony until like 60 years after it was founded because slaves cost more than indentured servants, but didn't live any longer.) However, if you combine the fact that the southern economy was based on labor intensive agriculture (indigo, tobacco, and cotton) with the presence of cheap slave labor prevented the southern economy from industrializing, which limited its growth during and after the industrial revolution. An amusing note from the chapter: between 1620 and 1660 (?), the Virginia government continually re-passed laws requiring everyone to plant at least two acres of corn. Apparently, most didn't want to take the minimal time away from their tobacco crops, in spite of the fact that they were frequently starving.

thedevil 10y ago

It's not that it wasn't significant at that time. It's just that in the long-term, it looks small compared to making the value of the labor of the entire population 100x more valuable.

eropple 10y ago
This is true, but most of the economic historians I am aware of also acknowledge that America wouldn't have been in the position to leverage industrialization that it was without the economic driver of slavery. Disentangling them is very difficult and usually smells of a political motive.
- Shubley 10y ago
  The slave holding states are now the poorest and were under-industrialized even during the Civil war. The correlation between historical slavery and industrialization/modern wealth is negative. Not really difficult to disentangle. And theres Canada.
- scythe 10y ago
  >Disentangling them is very difficult and usually smells of a political motive. Whereas claiming they can't be disentangled is obviously disinterested. Slavery was the rule, not the exception in the world at the time. The African kingdoms mostly practiced it, the Arabs were infamous for it, Mexico ended slavery in the 1830s after American industrialization was well underway, Russia didn't truly end serfdom until around 1900 as I recall, and then you have India's caste system, so only China is left without slavery in some form? But were they? And why didn't all of these countries industrialize?
  - mcguire 10y ago
    Possibly because they didn't have the large amount of valuable raw materials to process, the way England did from its slaveholding colonies?

lordnacho 10y ago

Normally the story is that you need certain institutions to make it work. Rule of law (contracts, low official corruption), absence of arbitrary confiscation risks (ie the King is not going to suddenly come and grab your stuff), unfettered movement of goods/people/ideas. Generic ideas that allow you to compare across societies. I actually studied economics, and the explanation of how growth arrived does not normally rely on slaves. It tends to focus more on the advent of early parliamentary government (Glorious Revolution), presence of coal in northern England, and advancement of science and technology. There's no absolutes in economic history though, and you might well find an argument that the triangular trade aided the industrial revolution. That's more of a vignette that explains why England in particular might have prospered, rather than an explanation of how growth gets started in general.

CPLX 10y ago
I've got a degree in economics as well. There are a few more big ones, including the advent of the joint stock company (or more generally, the ability to effectively pool capital) and the common law, specifically the ability to enforce business contracts. Those two are fundamental.
- lordnacho 10y ago
  This is a good point, under the rubric "institutions girdling trust". Quite relevant as a set of innovations in the time when people started having to do business with strangers, particularly ones with different ecological positions. You can imagine having lived in agricultural societies there would be a big question of how exactly you're going to have a business relationship with say a factory owner or delivery company. JSC, exchanges, (perhaps central banking as well) and various encounters with credit issues worked out a certain way in the UK, and innovations were copied across many other societies.
  - desas 10y ago
    Didn't the UK mainly copy them from the Netherlands?

mememachine 10y ago

Slaves were expensive, not free (not to say they werent a contributing factor)

cardiffspaceman 10y ago
Expensive compared to what? Since this idea is a little counter-intuitive, can you suggest a search or link? From this [0] I can only conclude that owners were paying for value and the price did go up over time, as did the price of cotton, but it looks like it was a good deal. [0] https://www.measuringworth.com/slavery.php https://www.measuringworth.com/slavery.php
- mememachine 10y ago
  Im not saying it wasnt a good investment for them (im sure it was), but it costs a lot of money not only to buy slaves, but to feed and take care of them.

joshuak 10y ago

An economy is about the volume of cashflow (value flow), not magnitude of wealth. If you have all the money in the world, you will find there is nothing you can buy. While a large number of, not free but very low cost, laborers will build individual wealth for the small percentage of the population who use them, those same laborers do not participate in the economy. So you end up with very large supply and very little demand, little or no reason to innovate, and a stalled engine of growth. Slavery, or even low wage workforce is bad even from the point of view of entirely selfish actors. It erodes the market eventually killing the entire economy. The lesson is, if you want to get rich don't reduce the cost of your labor force, increase the value of your production.

vernon99 10y ago
This basically sums up the debate to me. Great summary.

MomentarySanity 10y ago

If you think slavery was the main, or even a large driver of industrial growth, you need to explain the extreme lack of industry in places where slavery was common versus places where there was no slavery. E.g., New England versus the Carolinas, etc.

baursak 10y ago
http://www.pbs.org/wnet/african-americans-many-rivers-to-cross/history/why-was-cotton-king/ http://www.pbs.org/wnet/african-americans-many-rivers-to-cro...
- MomentarySanity 10y ago
  Northern manufacturing bought cotton from slave plantations, yes. As did British mills. However, you'll note that in the absence of southern cotton during the Civil War, these textile mills did not shut down or become unprofitable, they switched to alternate sources of cotton.

mcguire 10y ago

Not an economist, but... I don't think that there is any doubt that slavery provided a great deal of the early economic growth in the American south. (Weirdly, I was just reading an article that suggested that slavery itself did not catch on in the Virginia colony until like 60 years after it was founded because slaves cost more than indentured servants, but didn't live any longer.) However, if you combine the fact that the southern economy was based on labor intensive agriculture (indigo, tobacco, and cotton) with the presence of cheap slave labor prevented the southern economy from industrializing, which limited its growth during and after the industrial revolution. An amusing note from the chapter: between 1620 and 1660 (?), the Virginia government continually re-passed laws requiring everyone to plant at least two acres of corn. Apparently, most didn't want to take the minimal time away from their tobacco crops, in spite of the fact that they were frequently starving.