Economics 375 Slavery and the Civil War by wanghonghx

VIEWS: 22 PAGES: 88

									Economics 375
American Economic History
Slavery and the Civil War
Lecture Notes
Professor Kenneth Ng
College of Business and Economics
California State University, Northridge
Readings
  Paul Johnson, A History of the American
  People--Part 3 and 4 for background.
  Atack and Passell, A New View of American
  Economic History-Chapters 11-14.
  Robert Fogel, Without Consent or Contract.
  William Mc Neil, Plagues and Peoples,
  Chapter 5-Transoceanic Exchanges.
Slavery-Introduction
 Explosion of research by Economic Historians into
 slavery in the post WWII period.
 Large amounts of resources devoted to collecting and
 analyzing the slave trade and the system of slavery.
 Understanding of slavery has been radically altered
 but because of the climate of political correctness,
 little of the results of this research has made it into
 the public schools.
 Much of the history taught in high schools today is
 wrong.
    The victors write the history.

    Abolitionist literature survived down to the
      present.
The Rise of the Atlantic Slave Trade.
 Slave trade explained by the movement of productive inputs from low
 to high marginal valued uses.
   In the US, there was plenty of land and few people. In Europe,
     there were more people and less land.
   The marginal product of labor was higher in the New World.

 Nature of the Slave Trade-
   Herbert Klein-The Middle Passage-On Reserve.

 The Slave Trade is an example of the alternative law of supply and
 demand—where their is a demand, a supply will arise to satisfy it-
 reallocation of productive resources from low to high marginal valued
 uses.
   Decimation of Amerindian population by disease created a shortage
     of labor in the New World.
        Read Mc Neil, Plagues and Peoples.
   Some labor reallocated through voluntary relocation-immigration,
     indentures, etc. but only a limited number of people were induced
     to relocate through voluntary means.
 Atlantic slave trade occurred from 1502-1860.
   Portuguese established trading posts along the coast of the
     western Sahara.
The Height of the Slave Trade
                                Slave Imports
                 1451-1600                                           275,000
                 1601-1700                                          1,362,000
                 1701-1810                                          6,200,000
                 1811-1870                                          1,898,000
                    total                                           9,735,000
 1701-1810-Height of the slave trade.
 Slave Trade was a multi-cultural enterprise.
     Blacks captured slaves and transported them to Barricos on the coast to be sold to white
      traders.
     Malaria prevented whites from penetrating the African interior. Slave trade was as much a
      black as a white undertaking.
     Roots inaccurate.
 Example of specialization according to Comparative Advantage. The common perception is that
 slavery was associated with cotton (Gone with the Wind). This is wrong.
     Cotton and tobacco were not the most important crops in the slave trade (as opposed to
      slave system).
     Sugar was the crop which drove the slave trade.
     80% of slaves were imported before 1810-before cotton production really got going.
The Destination of Slaves
        Distribution of Slave Imports 1500-1870
                Brazil                                         38%
          British Carribean                                    17%
         French Carribean                                      17%
          Spanish America                                      17%
            United States                                      6%
Dutch, Danish, and Swedish Carribean                           6%
  Before 1550-90% of slaves went to Iberian peninsula and Iberian islands off the
  African coast. Grew sugar.
  After 1550-Center of slave trade shifted across Atlantic to Brazil. New World
  found as a suitable climate for sugar production.
  In 1600’s British and French broke Spanish sugar monopoly by establishing
  sugar production in the West Indies.
      Military expedition against Jamaica.
  By 1770, Spain had been squeezed out of sugar trade.
  Thus the great majority of slaves were involved in the Sugar trade outside the
  US.
  In terms of the slave trade the US was a backwater.
      Only 6% of the blacks snatched from Africa were imported to the U.S.
The Nature and Character of U.S. Slave
System vs. the rest of the New World.

   U.S. slavery differed from slavery in
   other parts of the new world because
   U.S. slaves engaged in Cotton rather
   than Sugar production.
      The absence of sugar culture had a
       profound effect on the character of US
       slavery.
Differences
Differences: Composition of the Population in Slave Societies



    Percentage of slaves in general population much lower in U.S. compared
    to Caribbean.
        Economies of scale plus climate meant that sugar colonies were heavily black.
    Sugar plantations were some of the largest economic organizations of
    their times.
        Many plantations had 100’s of slaves-little contact with whites and European
         culture.
    Nature of sugar production required heavy labor-cutting the cane and
    squeezing the sugar out in large presses.
        Little productive work for women-led to the importation primarily of men and a
         sex imbalance among the slave population.
    In many sugar colonies, whites comprised less than 20% of the
    population sometimes less than 10% of the population.
Disease Environment.
 In the Caribbean, the death rate was so high and the birthrate was so low, the
 slave populations were not self sustaining.
     The Caribbean experienced a 2-5% rate of natural decrease among the slave
      population .
         Read Mc Neil, Chapter 5.
     Explanation for difference is in the disease environment in the Caribbean and
      the isolation of African populations that were the source of most slaves.
         Typhus, malaria, tetanus, dysentery.
 Process of seasoning killed off 30% of the newly arrived slaves in the first year in
 the New World.
     Also, the sex ratio in the slave population explains the rate of natural decrease in the
      Caribbean.
     Less than 40% of the slaves brought from Africa were female.
 Experience of typical immigrant groups-first wave of immigrants male, followed by
 successive waves in which the proportion of women increases.
     Typically it takes several generations for immigrant population to achieve 50/50 sex
      balance.
     The Caribbean Slave population never achieved this balance.
 The negative net present value of children in sugar culture provided the slave
 owner in sugar societies no incentive to promote the birth of children.
Isolation of U.S. Slaves from African Culture
Slave Culture in U.S. vs.
Caribbean.
  Through the 19th century, the majority of slaves in the
  Caribbean were born in Africa.
     Native born blacks comprised the majority of US slaves as early
      as 1680.
     By 1860, all but 1% of American slaves were American born.
  Natural Increase was the main cause of the increase in
  the US slave population.
     Difference between US and Caribbean slave experiences.
     US population was self sustaining from the beginning.
of a successful slave rebellion had
profound effects on the character of
slavery in the Caribbean vs. the U.S.
  Probability of slave rebellion in sugar colonies very high.
    Seasoning and the perils of the trip from Africa.

    High levels of physical effort demanded.

    No women.

    No exposure to white culture.

    Isolation of whites from outside help.

  Led to a very brutal system of justice.
  Successful rebellion in Haiti.
  Blacks in US were part of much smaller units and were in close
  personal contacts with white owners.
Emancipation Outside the U.S.
 Distribution of Slaves in Western Hemisphere,
                      1825
                Brazil                                             31%
          British Carribean                                        15%
         French Carribean                                          4%
          Spanish America                                          11%
            United States                                          36%
Dutch, Danish, and Swedish Carribean                               2%

  Slavery abolished in British Caribbean and South America mostly before 1850.
      Emancipation accomplished largely through non-violent methods which included
       payments to slave owners to compensate them for their financial investments in
       slaves.
  In 1860, America left as the last great slave system.
      Although the vast majority of blacks brought to the New World as slaves were sent to
       countries outside the U.S., the more favorable demographic conditions in the U.S. led
       to a higher survival and reproduction rate of U.S. blacks.
      Over time the U.S. slave population grew to the largest in the world.
  The U.S. was a minor player in the slave trade, but by 1860 was the great slave power in
  the world.
  Question: would slavery have ended without Civil War?
Cotton and the Slave Population.
  Slavery in the U.S.- General Outlines
      Although slavery was prevalent in all states in the colonial period,
       by 1860 slavery was concentrated in the southern states and in
       cotton production.
      Moving South and West, the slave labor force under the direction
       of it’s white masters created one of the great success stories of
       American Economic History.
      Whitney’s Cotton Gin (1793) enabled short staple cotton to be
       separated on a competitive commercial basis by mechanical means,
       enabling the domination of American cotton of world markets.
      From 1820 to 1860, cotton output rose by a factor of 11.5, the
       slave population by 2.5, and output per slave by a factor of 4.6.
      From 1790 to 1860 the slave population in the South grew slightly
       more rapidly than the white population---in the absence of
       significant slave imports.
      Ownership of slaves became more concentrated by the 1850’s.
       Southern families owning slaves fell from 36% in 1830 to 25% in
       1860.
The Great Tragedy of the Civil War.

  Why fight?
     Voluntary Emancipation and the failure of the U.S.
      Constitution.
     The usual method of conflict resolution in the U.S.

      is through non-violent means , e.g. the ballot box.
  Why was the Civil War so costly to fight—both in
  lives and material?
     Motivation.

     Balance of Forces.

     Technology and Tactics.

  Could Slavery have been ended more cheaply?
Explaining the Lethality of Civil War.
  2 Factors led the Civil War to be very lethal.
    Evenly matched opponents-same culture, tactics, weapons,
     etc.
        Balance of forces-equally divide country, same culture,
         tactics, technology and will to fight-leads to long and
         bloody conflict.
        Generals trained at the same military academies.
            Many of them knew each other personally.

            Employed the same tactics.

            Wars where new tactics and technology are
              employed for the first time are usually short and not
              bloody.
                 Iran/Iraq war employed new tactics developed
                   during the cold war—AirLandSea doctrine of U.S.
                   armed forces.
                 Early stages of WWII, Hitler employed new
                   tactics-Blitzkrieg.
More Technology
    Improvements in Logistics
       Railroads and canal system allowed the
        concentration of large groups of armed men in
        the field for extended periods of time.
       The transportation system also allowed large
        groups of men to sustain
    Changes in the technology of warfare.
       Musket vs. percussion cap vs. machine gun and
        artillery--increased rate of fire of percussion
        muskets
       Minnie Ball and Percussion Cap increased rate of
        fire.
Minnie Ball




The Minnie Ball made it much easier to force the bullet
down the muzzle of a rifle increasing the rate of fire.
Flintlock vs. Percussion Cap
                   The percussion cap
                   reduced the number of
                   tasks required to load a
                   rifle increasing the rate
                   of fire of a trained
                   soldier.
Technology
 The Minnie Ball and Percussion cap increased the rate of fire a
 trained soldier could sustain.
 For the first time, a disciplined group of soldiers could withstand
 a frontal charge by infantry or cavalry.
   Calvary Attack and Imperial Guard attack at Waterloo
     (formation of a square) at Waterloo.
   Pickett's Charge at Gettysburg

   Battle of Rourkes Drift-First Metallic Cartridge

        Movie Zulu-Rourke's (THE SOUTH WALES BORDERERS
         AND MONMOUTHSHIRE) drift-4000 Zulus attacked 100
         British soldiers.
 Early battles of Civil War were great tragedies.
     Troop morale and irrational expectations during early stages of
      conflict.
     French mutinies during WWI trench warfare.
Technology and Tactics
  The Civil War was a case where the
  technology of warfare had advanced
  while the tactics employed by generals
  had not adjusted.
  The result was a very high level of
  lethality.
Cost of Civil War. Goldin and Lewis.


   Direct Costs of the Civil War (lives lost)
     Direct Deaths.

        600,000 died in Civil War.
     Population-Korean war 150 million. WW2-150

      million, WWI-100 million. Spanish American War-
      50 million.
      How Many People Died in Civil War?

                                     Total Deaths
                             Total Deaths Battle Deaths   Other Deaths   Wounds Not Mortal
Civil War (Union)                  364,511  140,414         224,097          281,881
Civil War (Confederacy)            258,000                                   199,515
Spanish American War                 2,446     385           2,061            1,662
WWI                                116,516   53,402          63,114          204,002
WW2                                405,399  291,557         113,842          640,846
Korean Conflict                     54,246   33,629          20,617          103,284
Vietnam (American)                  56,886   46,498          10,388          153,000
Vietnam (North Vietnamese)         660,000
Vietnames (South Vietnamese)       220,357
6-Day War (Israel)                   1,000
6-Day War (Egypt, Jordan,
Syria)                              18,000
If you were a draft age male what were your chances
of being killed or wounded?

   Deaths and Wounds as a Percent of Male Population
                                                           Percent of Male
                                                           15-24 Population
                                                                Killed or
                                         Percent of Male Wounded (17%
                                         Population Killed   of population
                             Population   or Wounded         male, 15-24)
 Civil War                    31,443,321     7.02%              41.30%
 Spanish American War         50,000,000     0.02%               0.10%
 WWI                          92,228,496     0.70%               4.09%
 WW2                         132,164,569     1.58%               9.31%
 Korean Conflict             151,325,798     0.21%               1.22%
 Vietnam (U. S.)             203,302,031     0.21%               1.21%
 Vietnam (Vietnamese)         39,463,910     4.46%              26.24%
 6-Day War (Israel)            2,746,898     0.07%               0.43%
 6-Day War (Egypt, Jordan,
 Syria)                       38,662,000       0.09%            0.55%
If you were in the army, what were you chances of
getting killed each year?



       Annual Death rate per 1000 average strength
                       Total Deaths   Battle Deaths   Other Deaths
Civil War                 104.4            40.1           64.3
Spanish American War       36.6
WWI                        35.5           17.1           18.4
WW2                        11.3           8.6             3
Korean Conflict             5.5           3.4            2.1
Vietnam                     0.7           0.6            0.1
What were your chances of having to serve?



                           Probability of Service
                                        Percent of Male
                                        Population, 15- Percent of   Percent of Male
                       Total Personal    24 in Armed Armed Services Population, 15-24
                       Serving in War      Services Serving Abroad Serving Abroad
Civil War                   2,213,000      41.40%
Spanish American War          307,000       3.61%         29%            1.05%
WWI                         4,735,000      30.20%         53%           16.01%
WW2                        16,113,000      71.72%         73%           52.35%
Korean Conflict             5,720,000      22.23%         56%           12.45%
Vietnam                     8,744,000      25.30%
The Enormous Human Cost of
Freeing the Slaves

  Civil war was one of the most
  lethal wars.
  1 free person killed for each
  slave freed.
Monetary Cost of Civil War
  Estimated direct cost of the Civil War was $6.6 billion dollars.
  Direct cost of $206 for each American in 1861 or almost twice
  the amount consumed by the average American in 1860, i.e. 2
  years wages.
      Had the same amount been invested at 6% it could have provided
       an annuity equal to 10 % of average income.
      $6.6 billion was enough to buy the freedom of all the slaves at
       market prices, provide them with 40 acres and a mule, and still
       leave $3.5 billion to pay for reparations to blacks for the lost pay
       under slavery.
         Spike Lee Production Company-40 Acres and a Mule.
  From a cost/benefit perspective, the Civil War was a monstrous
  stupid mistake.
Why Fight--Cost of Emancipation to White Southerners
in 1860.
   The U.S. constitutional system is good at compromise--division
   of powers, senate vs. house of republicans, electoral college.
   Etc.
   Constitution constructed to force differences of opinion into the
   political arena and it has largely been a success.
       The U.S. is largely free of outbreaks of violence.
   The constitution and politicians wrestled with the slavery
   question for decades prior to the Civil War.
       End of slave trade in 1810-expected to end system of slavery.
       3/5ths Compromise-count each slave as 3/5ths of a person for
        determining representation.
       1820-Missouri compromise (Maine Missouri)
       Compromise of 1850 (Land acquired in Mexican/American war)
        Kansas Nebraska Act (1854).
   Ultimately, the constitution failed. Slavery was “too big” a
   question.
The end of slavery the one big issue where the
U.S. constitution failed.

   Capital Value of Slaves in 1860 was $2.7 Billion.
       Invested at 2.5% this was enough to reduce the value of income to
        the average southerner by 23%.
       Today with an average income of $18,000, 23% of $18,000 is
        $4140.
       To produce this annual income each individual would have to have
        $165,600 in bank at 2.5%.
       Clearly, the end of slavery would have a profound and significant
        effect on the average white southerner’s welfare.
   Rationality of the southern redneck-poor white people didn’t
   directly benefit from slave ownership.
   Southerners were not going to agree to any system of voluntary
   emancipation that did not fully compensate them for the value
   of their slaves.
   Northerners would have to impose very large tax increases to
   pay for voluntary emancipation.
The Conundrum of the Civil War.—Why did
Northerners fight CW?
  Main Beneficiary of Slavery White Northern consumers.
    Why the second half of Fogel’s book (The Ideological and

      Political Battle Against Slavery) is about the battle to end
      slavery.
  Slavery the low cost method of producing cotton.
    Gang system of labor.

    Hand rating system.

    Monitoring costs.

  Market in slaves competitive so that slave owners earned only a
  normal rate of return on slave ownership.
  Market in cotton textiles competitive so that price of cotton bid
  down to the minimum ATC of production.
  Consumers who bought cotton textiles enjoyed the benefits of
  slavery in terms of lower cotton prices.
The Indirect Costs of Ending Slavery.
  Besides the human and financial costs of
  fighting the Civil War, the end of slavery:
     Imposed costs on slave owners who lost the
      money invested in slaves.
     Imposed costs on southern landowners who now
      had to use their land in its’ second most
      productive use.
     Imposed costs on northern consumers who had to
      pay a higher price for cotton cloth.
     Those who “paid” to end slavery had nothing to
      gain.
     The Civil War was fought on largely moral not
      economic grounds.
White guilt over slavery and “the Great
Moral Crusade.”
  Northerners subjected themselves to huge cost to
  end slavery which be benefited no one but blacks.
  Moral explanations of the end of slavery.
    Success of the abolitionist movement as one of

     the great adventure stories of all time.
  Fogel concludes that whites were not pursuing their
  narrowly defined self interest (money income) in
  ending slavery but instead were motivated mainly by
  moral factors.
    Why half of his book, Without Consent or
     Contract, is entitled “The Ideological and Political
     Campaign Against Slavery.”
Another Big Questions About the Civil War-
Would Slavery Have Ended Without a War?

History of Civil War has been long fought over.
Even today some of the issues are still being
fought out.
  Example: flying the confederate flag.

  Better example: The idea that the CW was
   fought over saving the Union rather than
   ending slavery.
     Denial of credit to whites for having the
      moral conviction and bearing the human
      and financial price for ending slavery.
Historiography of Civil War (1)
In the period prior to the Civil War, abolitionists mounted a
public relations campaign against slavery.
  Similar to the anti-smoking campaign going on today.

  Abolitionists promulgated certain known falsehoods about
    the nature of the slave system.
       They argued that “the end justifies the means.”
  The victors write the history.

       The history of the Civil War written immediately following
        the war was simply the continued preaching the myths
        of abolitionists.
       Many of these myths have never really corrected.
Post Civil War historians specializing in the the Civil War
concentrated in southern universities.
  Size and inbred nature of history departments vs.
    competition in intellectual endeavors.
  The active researchers became concentrated in a small
    number of southern history departments.
   Historiography of the Civil War (2)
Ulrich B. Philips-began publishing around 1905.
   Argued that slave culture continued because of speculation,

    economies of scale, and conspicuous consumption.
   Therefore,because slavery was not economically viable, slavery

    would have ended on its own.
   Attempt to depict Southerners as victims.

Charles Ramsdell- Slave owners were forced to overproduce cotton-
irrationality argument-economies of scale.
   Natural Limits argument-Cotton production led to soil exhaustion

    so that slavery required a constant expansion to new lands.
       As new lands ran out, slavery would have ended.
       Incompatibility of slavery and urban society.
            Slave system could not be adapted to urban conditions.

   No systematic investigation of profitability of slavery.
  Historiography of the Civil War (3)
The rise of the welfare state, affirmative action, quotas etc.
  The legislative battles surround the beginning of the
     Johnson/Kennedy Great Society programs.
  Campaign to get public support for the modern welfare state.

Black radicals and Pan-African Studies.
  Contemporary theories of black victimization

Fight over the minimization of the Civil War.
  Attempt to ignore the human and financial costs borne by whites
     in the Civil War.
The historiography of the Civil War and Slavery is more a lesson in
how non-scientists have attempted to distort history to harmonize
with the politics of the day or the ideological bias of the writer than
an honest attempt by scholars to discover the true nature of the
slavery and the causes and consequences of the Civil War.
Little attempt to do “good science” and actually measure the
profitability of slavery and discover whether slavery would have
ended without the Civil War.
                   Was slavery profitable?
In the post World War II period, economists began applying economic
theory and statistics to the central questions of U.S. history.
   Used different sources of data and different methodology than existing
    scholars.
   Quantitative vs. qualitative data.
First study by Conrad and Meyer (1958)
   Graduate students in economics.
      Applied simple 200 level economics to profitability question-
   Found, not surprisingly, that slave owners treated slaves like factory owners
    treated expensive machinery.
   C&M found that slave owners earned about 5-8% return on slave
    ownership.
   C & M set off debate that refined their estimates. At the end of the debate,
    it was found that the return on slaves was equivalent to the return on
    railroad bonds and other non-agricultural 8-10%
Evidence that slave owners were calculating businessmen interested
only in profit-revolutionary idea at the time.
Profitability of slavery undermines the argument for conspicuous
consumption.
Were Slave owners rational profit
maximizing businessmen?
  Argument over numbers, but additional evidence for rationality
  of slave owners are age/price profiles.
    Failure of conspicuous consumption arguments-why is 26 yr.

      old more “conspicuous than 32 yr. old or less than 14 yr.
      old.
  Age price profiles.
  • Collected data from slave markets.
  • Similar to used car market today where published
    information is readily available on the price of cars in various
    conditions.
  • Detailed information about prices and characteristics of
    slaves recorded and published.
Net Income by Sex and Age
                  Shows the net income a slave owner
                  could expect from a typical slave at
                  different ages.
                  Slaves began to cover their cost of
                  maintenance at an early age—late
                  adolescence.
                  Prior to age 15, women earned more
                  than men—tomboys and older sisters.
                  Profile reflects the earlier physical
                  maturation of women.
                  Men and women in professional sports.
                        Ice skating, gymnastics and
                        tennis.
                  For most of life females earned 20-40%
                  less than men
                        Typical in a non-industrial society
                        and reflects the biology of the
                        human body.
                        Reflects the gender differences in
                        societies that rely on physical
                        labor.
Accumulated Net Income/Age Profile
                 Shows the total lifetime income a slave owner
                 realized from a typical slave at various ages.
                 Until around age 12, the slave is consuming more
                 than the cost of maintenance—the line is downward
                 sloping.
                 At age 12, the slave begins to produce more than he
                 consumes-the line begins to slope upwards but
                 remains below zero.
                 By age 28, the slave has “worked off” the
                 investment the slaveowner made when the slave
                 was young-the line is above zero.
                 Incentive for slave owner to maintain the slave as a
                 productive asset throughout the slave’s life—the
                 lines stays positively sloped.
                 Slave’s net income remained positive even in old age
                 Incentive for slave owners to keep old slaves—
                 decent treatment of old slaves.
Age Price Profile
               The price of a slave at a given age
               represents the present value of the
               expected net income of the slave over
               his remaining lifetime.
               At age 0, the slave had a positive price.
               This means that the slave owner had an
               incentive to encourage live births.
               Peak price occurred in the late 20’s and
               early 30’s.
               Only in the mid 70’s does ownership of a
               slave become unprofitable.
               Slave owners retained a financial
               incentive to take care of old people.
Would Slavery have ended without the
Civil War—The Viability Question?
             Capitalized Rent in an 18 yr. Old Slave
      Years               Average Price   Gross Rearing Cost
      1821-25                 $736              $657
      1826-30                 $792              $614
      1831-35                 $974              $671
      1836-40                $1,206             $848
      1841-45                 $744              $591
      1846-50                 $936              $737
      1851-55                $1,252             $807
      1856-60                $1,596             $938

 If slavery were becoming unprofitable, what would happen to
 slave prices in the year’s leading up to the Civil War?
 Evidence shows that slavery was profitable, was getting more
 profitable, and was expected to continue to be profitable after
 the Civil War years.
What was slavery like—The Slave Family?
  Slave Owners as profit maximizing businessmen.
     Not surprising result is that slave owners treated slaves like factory owners
      treated expensive machinery.
     Thinking of slave owners as businessmen motivated by the profit motives
      “explains” many of the aspects of the slave system.
  The Slave Family
     Legacy of Slavery arguments have been used to attempt to explain many
      aspects of current black family structure.
         The Great Society Programs and the welfare debate in the late 60's and
           early 70's.
         Greater prevalence of single parent families among black families
           explained by the structure of the slave family.
     Because at birth slave infants had a positive present value it was in the
      economic self-interest of the slave owner to promote live births.
         Did this primarily by promoting the traditional family structure among
           slaves.
         The abolitionist depiction of slave breeders was false.
         Slaves live primarily in a normal nuclear family.
     Between 1790 and 1860 both the free white and slave populations of the
      South grew at roughly the same rate.
         Similarity of Rates disposes of idea that slaves were bred at maximum
           rates.
 What was slavery like—Living Conditions?
Fogel and Engerman argue that slaves lived remarkably well.
    Basic argument is that owners had a strong financial incentive to maintain the viability of the their
     financial investment.
    Debate over conditions of slavery has been tainted by abolitionist literature. Abolitionists tried to
     portray conditions of slavery to elicit favorable response from northerners to abolish slave trade.
     Abolitionist propaganda tainted historical view of slavery.
Basic Slave Conditions
    Diet.
         Use census of large plantations, business records, and instructions to overseers. Take amount
           of food produced, subtract portion fed to animals, sold, etc. and assume residual used to feed
           slaves.
         Basic diet consisted of corn and pork and was well balanced and contained sufficient calories
           to sustain high levels of work.
         Basic slave ration contained 4100-4200 calories a day and contained high levels of protein,
           iron, calcium, and vitamins-high enough to meet modern daily recommended requirements.
         Diet not that much different than that eaten by free whites.
    Housing and clothing.
         The typical slave was housed and clothed simply but not badly.
         5 adults lived in an 18x20 foot cabin, w/1 or 2 rooms, a plank floor, fireplace and shuttered
           windows
         Slave had more space per person that New York’s free poor in the late 19th century.
         They each received 4 sets of cotton shirts and pants or dresses and 2 pairs of leather shoes
           plus coats and blankets as needed.
Slave Conditions (2)
   Medical Care, Life Expectancy, and Infant mortality
       Access to Medical Care was irrelevant to the well-being of antebellum Americans.
         environmental factors-water, diet, etc. explain differences in mortality and the
         record for slave was reasonably good.
       For slave women 6 out of 1000 pregnancies ended in death of mother-lower than
         for white southern women.
       183 out of 1000 infants failed to reach 1 yr. old compared to 146 per 100 among
         white children
       Due to work during last trimester causing underweight children.
   Punishment
       Whipping, public humiliation, and loss of privileges were the primary means of
         punishment. Jail reduced labor productivity.
       Whipping used w/discretion.
       over a two year period, 45% of slaves were never whipped and 19% were
         whipped once.
       The average number of whippings per hand was .7 per year.
   Gifts and non-appropriated income as reward.
       Rewards used as an incentive for hard work.
   Slaves received gifts or small plots of land to work as incentives for hard work.
   Occupation as Reward.
       Occupation used as a reward for service.
       Slaves could escape work gangs by hard work and docility for a decade or more.
                       Rate of Exploitation
The paradox of forced labor is that even though blacks were enslaved and had a
portion of their wages expropriated by slaveowners, their material standard of living
was higher than that of free white farmers.
    Before Fogel and Engerman, the picture of life on the plantations was biased by
     abolitionists--depicted slaves living in marginal physical state and the life of slaves
     as typical to concentration camp inmates.
    Optimal mix between positive and negative reinforcement-
        Not clear slave owners wanted to run plantation as a concentration camp-
        Might be possible to get greater levels of inducement out of slaves using a
          mix of positive and negative reinforcement.
How much of the product of black labor was diverted by slave owners?
    Exploitation defined as the percentage of a slaves competitive wage is
     expropriated by slave owner.
        Doesn’t include non material positive aspects of being free vs. a slave.
    Fogel and Engerman define the rate of exploitation as the difference between the
     present value at birth of the value of the slave’s product and the value of goods
     and services provided by slave owner.
        Until age 9 the annual value of a slave’s output less than maintenance.
        From 9 on, the yearly value of slave’s output greater than maintenance but it
          takes 18 years for the loss to age 9 to be recouped.
Rate of Exploitation is 12%-less than the modern income tax rate
        The Paradox of Forced Labor

Slaves actually experienced a larger monetary standard of living than
free farmers.
   Cotton plantations were extraordinarily productive.

   The average cotton farm produced 29% more output than the
     average free farm in the North with the same inputs.
   Slave owners expropriated 12% of a slave's income, but this left
     more goods than a typical free farmer in the North consumed.
In essence, slaves and owners split extra output that derived from
gang system of labor on cotton plantations.
The Paradox of Forced labor is that in a capitalist system, in which
personal liberty, strong private property rights, and the individual’s
ability to deploy his productive inputs, e.g. labor, are bedrock
principles, slave labor or coercion was used to produce a good (cotton)
in a highly efficient manner.
Economics 375                Slavery and the Civil War Paper Assignment
                             Fall 2000



Readings for Paper.
Transcript of Goldwater's    In his 1964 acceptance speech at the Republican National Convention,
Acceptance Speech            Barry Goldwater, the republican nominee, spoke the following famous
Alternative Link to
Goldwater Speech             words:
The Conservative 1960's by        I would remind you that extremism in the defense of liberty is no
Mathew Dallek                     vice. And let me remind you also that moderation in the pursuit of
                                  justice is no virtue.

                             Read the following:
                             1. Full text of Goldwater's acceptance speech.
                             2. The essay "The Conservative 1960's by Mathew Dallek,
                             3. Part 4 and the relevant sections of Part 8 in Paul Johnson.
  Barry Goldwater            4. Part II of Robert Fogel's Without Consent or Contract.
                             5. Any other relevant assigned reading or lecture notes.

                                        Compare and contrast the abolitionists and their campaign to
                             end slavery and Barry Goldwater's presidential bid.
                                        Your paper should be 3-10 pages and will be scored based on
                             the quality of your reasoning, the lyricism of your prose, and the number
                             of elements from the readings you are able to integrate into your essay.
                                        The assignment is due Monday Dec. 4th at Noon and should
                             be emailed to kenneth.ng@csun.edu.
What happened to blacks after Civil War?

  Good example of limits of historical research.
    Nutrition literature unusual in the amount of inferences that the data allow.
    Some historical issues may never be answered-example effect of
     segregated schools literature.
        Since there was no standardized testing, no way to correlate school
          expenditures and educational achievement.
    For assessing the progress of blacks after the CW, the problem is that the
     agricultural census did not record the race of the farmer.
        Therefore, the only way to estimate income by race is to cross
          reference the population and agricultural census-a labor intensive
          process.
    Early estimates of black income after emancipation.
        Roger Ransom and Richard Sutch-One Kind of Freedom
        1960's hippies at Berkeley.
              Got a NSF grant and cross referenced the 1880 population and
               agricultural censuses and used the results to estimate black
               income before and after emancipation.
Computing the Value of
Freedom
 Data problems.
   While it seems an obvious question, historians had no good answer
     until economic historians arrived on the scene and even then it
     required an involved data gathering effort.
 Estimation of black income is complicated by the nature of the
 surviving data.
   Difference between published census volumes and the manuscript
     census.
   Each person and farm fills out return.

   Census takers tabulate returns and print summary tables.

     Information available depends upon what tabulators decided to
     add up.
   Population census contains no information about income because
     no one really cared about making Black vs. White comparisons.
 Ransom and Sutch matched linked population return and agriculture
 return—Ransom and Sutch Dataset.
 Additional problems can be shown using Indifference Curve Analysis.
Measuring the Benefits to Freedom-An Indifference
                 Curve Analysis
    Income                             Using the gang system, the slave
                                       owner forced blacks to work at very
                                       levels of effort (point C) and then
                  Slavery              expropriated a portion of the slave’s
                                       output (moving the slave from point C
                                       to B).
                                              At point C, the slave is
             C         After                  consuming a non-optimal bundle
                                              of income and leisure.
                       Expropriation
                   A                         He would rather be at A—with
             B                               less income and more leisure.

                                       Income at point B can be estimated
                                       using plantation and agricultural
                                       census records.


                                        I2    I3
                                  I1
         0                                                     Leisure
Measuring the Benefits to Freedom-An Indifference
               Curve Analysis (2)
                                        After emancipation, the gang system
                                        was no longer viable.
    Income
                                        The opportunity cost of leisure was
                                        reduced (purple dotted line).

                                        The freed slave will reduce his work
                                        effort moving to point D.

                     After        At point D, even though money
                     Expropriationincome is lower, the slave is better off
                                  (higher indifference curve) because he
                                  has increased the amount of leisure he
             B              Freedomconsuming.
                                  is
                 D                It is also possible that money income
                                  would increase after emancipation but
                                  the value of freedom, measured by
                                  the increase in money income, would
                                  still underestimate the value of being
                                  freed.I2 I3
                                   I1   To truly measure the value of
         0                                                           the value
                                        freedom, must account forLeisure
                                        of increased leisure of freed blacks.
Computing the Value of Freedom (2)

Can estimate income by taking value of output and subtracting costs of
production and then dividing by the number of people on farm.
First problem, census gives information about the value of output for
the farm and the amount of various inputs used. Blacks who were not
owners didn’t keep all the profits of the farm.
  Must take into account 3 different arrangements depending on
    whether blacks owned land, capital, or just provided labor.
  owners, sharecroppers, and sharerenters.

Must adjust income estimates for the effect of increased leisure.
  Main assumption made by Ransom and Sutch is measuring the

    value of freedom on the average wage rather than the marginal
    wage.
  Issue of which is more accurate, a direct measure of what people

    could earn if they worked more or an imputed measure in which
    various assumptions had to be made.
The Value of Freedom
                            Ransom and          Improved     Direct Observation
                               Sutch         Residual Method     of Wages
Black Income in 1859          $27.66             $27.66           $27.66
Black Income in 1879          $35.59             $40.24           $40.24
Value of Leisure           $13.75-$21.00      $14.82-$23.44    $31.01-$36.78
Value of Freedom           $22.05-$29.01      $27.40-$36.02    $43.59-$49.36
Increase in Income           78-105%            99-130%          158-178%

Free blacks experienced a large annual increase in their material standard of living.
Since emancipation was a once in a lifetime event, it is appropriate to measure effects
over lifetime.
     In PV terms, blacks received a lump sum payment of 26 to 30 times average
     income-- about $500,000 in today’s dollars.
Argument that blacks didn’t benefit from freedom is wrong i.e. Civil War wasn’t a waste
of time. Emancipation did significantly increase black welfare.
What Happened to Blacks over Time?
What was black standard of living compared to whites?
    Ransom and Sutch only compute black income in the South.
   Ransom and Sutch conveniently don’t measure white income in the
    South or compare it income in the rest of the country.
Can use the same methodology to measure white income in 1880.
After 1880 there is a problem.
  Problem is that there is no good income data by race outside of

    southern agriculture.
  Economics historians have estimated regional GNP numbers but not

    broken down by race.
  Ransom and Sutch only linked data within the South so there is no

    database which identifies race of person.
  First reliable income data based on race begin in 1947.

  Problem with 1900+ censuses—no manuscripts only the published

    volumes of census.
Ng and Virts-Compute income for 1900.
    The only year for which data is available in the published volumes of census.
Methodology (Ng and Virts)
                                                                           
Y owners  Routput  Vhou sin g  dl   Vland   dc  Vcapital  Vother                                cos ts    Rrent received      (1)
Y share  Routput  Vhou sin g  Vshare                                                                                                      ( 2)

                                                              
Y rent  Routput  Vhou sin g  Vrent  dc  Vcapital  Vother                              cos ts                                        (3)
    where:
    R output  value of output reported in the census               Equations 1, 2, and 3 show how
    V housing  value of housing provided                                  income is measured for each
    V  value of land including buildings
      land                                                                 class of tenancy.
                                                                    If the estimate for each type of
    dl = annual depreciation rate for land
    dl = average annual depreciation of land and buildings
                                                                           tenancy is weighted by the
      1880

    dc = annual depreciation of implements
    V capital value of implements and workstock                           relevancy of they type of
    V share  value of rent paid by share croppers                         tenancy, and estimate of
    .5  ( R     V
                 output          V      V
                              garden produce   pork)    other cos ts       average income per person can
                   value of garden produce
    V garden produce
                                                                           be computed.
    V  value of rent paid by fixed renters
                                                                    The
    .25  value of corn+.30  value of cotton in the cotton producing states numbers are then adjusted for
      rent



    or the average rent / value of output in other states                  the age distribution of the
    V           costs of fertilizer, hired labor, and animal feed
      other costs                                                          family.
    Vrent                  ((Vrent - ((dl  Vland ) - Vhousing )) + (Vshare - ((dl  Vland + dc  Vcapital )  Vhousing )) per owned farm
              recieved
                                                                                                   Black families had more children
                                                                                                      so per capita income is too
                                                                                                      low.
Methodology (2)                   Ysouth  Yrural  1  Yurban
                                   black      black          black
                                                                                                (5)
                                         .845(49.63).155(15)(49.63)
                                                            .
  Equation 5-southern income
  from southern farm income.              $53.47

  Equation 7-infers white
  southern income from black                NNI (1 )
                                Ynational                                                    (6)
  income-know personal                          P
  income in the South and                   $32,434,000,000(1.159)
                                         
  black income.                                     76,094,000
  Equation 8-infers national              $187.73
  income from southern
  income-assumes that black      Ysouth  Ysouth (1)Ysouth
                                            black         white
                                                                                               (7)
  regional income is
                                $95.74 (.3258)(53.47)(.6742)Ysouth
                                                                white

  proportional to white and
  black income.                          Ysouth  $143.02
                                            white



  Equation 9-infers white
  national income from black    Ynational   south Ysouth   n.central Ysouth   ne ne Ysouth   west  west Ysouth (8)
                                 black               black                black             black                  black


  income and total national              (.8969)(53.47)(.0561)(2.0197)(53.47)
  income.                                (.0436)(2.686)(53.47)(.0034)(3.196)(53.47)
  Adjust the whole mess for               $60.86
  the age distribution of the
  population and you get the
                                Ynational  Ynational  1 Ynational
                                              black              white
                                                                                                                  (9)
  following table.
                                187.74 (.116)(60.86)(.884)Ynational
                                                              white


                                         Ynational  $249.04
                                            white
Immediately following emancipation, blacks were concentrated in the rural South.
In the area in which they lived, the black worker earned 89% of the income that a white worker earned.
     Differences in labor quality probable explained the differential.
Nationally, blacks income was 34% of white income.
     The difference in black white income was due to the concentration of blacks in the rural south.
           Effect of urban/rural.
           Regional differences in per capita income.
Historical accident, not discrimination, explained lower black income immediately following the Civil War.
     Theories of black victimization?
The Cutting Edge.
 In unpublished research, Ng and Virts have estimated black and
 white income for 1900.
   Use the published volumes of the 1900 census.

   Historical accident that enough information was tabulated

     for the published volumes of the 1900 census.
   The required information is not available for the 1910, 1920,

     or 1930 censuses.
 Period 1880-1900, was the period in which there were many
 adverse historical developments for blacks.
   The segregated public school system was created.

   Blacks were disenfranchised.

   Black Codes were instituted.

 What effect did these historical developments have on black
 welfare?
                    Real Black and White Income in 1880 and 1900

                                                      Southern     Southern   National
                                                        Rural        Total     Total
                                                        Total       Income    Income
                                                       Income
   Per Capita                   1880 Black            $36.78        $38.43     $43.06
   Income                            White            $62.49        $79.44    $142.64
                                     B/W Ratio           0.59        0.48        0.3
                                1900 Black            $46.37        $49.96     $56.86
                                     White             $91.23      $117.87    $206.70
                                     B/W Ratio           0.51        0.42       0.28
                      1880-1900      Black              1.17%       1.32%      1.40%
                      Growth Rate    White              1.91%       1.99%      1.87%
   Per                          1880 Black            $65.93        $68.90     $77.20
   Worker                            White            $99.43       $126.38    $226.95
   Income                            B/W Ratio           0.66        0.55       0.34
                                1900 Black            $81.31        $87.61     $99.72
                                     White            $140.04      $180.94    $317.31
                                     B/W Ratio           0.58        0.48       0.31
                      1880-1900      Black              1.05%       1.21%      1.29%
                      Growth Rate    White              1.73%       1.81%      1.69%


In the period from 1880 to 1900, blacks increased their incomes in absolute terms.
Relative to whites, blacks in the last portion of the 19th century did not match the
progress of whites.
The adverse historical events in the South did have a negative effect on blacks.
What happened to blacks after emancipation-a
summary
Emancipation had an enormous immediate positive effect on black material welfare.
    Part of the increase in material welfare was enjoyed by blacks as in an increase in consumption of
     material goods (more income).
    Just as important as the increase in material income was the increased consumption of leisure.
    Using the prevailing wage rate to value leisure, the increased consumption of leisure was more
     important than the increased material income following emancipation.
    Equivalent to a $500,000 lump sum payment in today’s dollars.
Immediately following emancipation, blacks achieved a degree of equity with southern whites.
    In the labor markets in which the majority of blacks participated, they earned incomes comparable
     with whites.
        Any differences in income were probably due to skill differences resulting from recent
          emancipation.
    The black/white income ratio in 1880 of .37 is attributable:
        To blacks being emancipated in a poor region-the South.
        Being emancipated in rural rather than urban areas.
In the period from 1880- 1900, the legal and social environment of blacks deteriorated.
    Segregated public schools, Jim Crow Laws, disenfranchisement, etc.
    Without reliable income estimates, the question of whether these adverse historical developments
     adversely affected black welfare have been unanswered.
    During this period, black continued to improve their material condition but not as fast as whites.
Slavery and the Civil War- A Study Guide.
  Slave Trade
     Mortality and the slaver as a profit maximizing businessman.
     Multi-Culturalism.
  Comparing and contrasting U.S. slavery vs. slavery in the rest of the new world.
     Cotton vs. Sugar.
          Slave Rebellions and the nature of the slave system.
          Epidemiological differences.
     Natural increase vs. imports.
          Effect on black culture.
  The nature of the slave system and black culture.
          How were slaves treated and what was it like to be a slave-economic
           factors?
               Diet, housing, shelter, occupational advance, etc.

          Slave labor and the efficiency of producing cotton.
               Material condition of slaves vs. free farmers.

               The paradox of forced labor.

          Age/price profiles—what can we learn?
               Slave owners as profit maximizing businessmen.

                    Ramsdel and Phillips.

  The rise of the U.S. as “The Great Slave Power.”
          How did it happen-the confluence of factors?
Slavery and the Civil War- A Study Guide (2)
 Emancipation.
      Emancipation schemes outside the U.S.
      Why the U.S. was different?
 Civil War
      Politics---why no political solution?
          Constitutional limits
          Who benefited from the end of slavery and “The Great Moral Crusade.”
          Abolitionists, morality, and narrowly defined self-interest.
      Viability question-would slavery have ended without the Civil War?
          Evidence?
      Cost-human and financial.
          Why so lethal?
                Technology, tactics, geography and culture.

          Expectations and the rationality of fighting.
      Was the Civil War an efficient method of ending slavery.
      The ever changing history of the Civil War.
          Abolitionists, southern historians, blacks studies departments, liberals, and
            economic historians.
Slavery and the Civil War- A Study Guide (3)


    Freedom and Emancipation.
       The Value of Freedom.
           Did emancipation mean much to blacks?
       What happened to blacks in the late 19th century.
           Did changes in the political and legal environment materially effect
            blacks?
       What happened to blacks in the 20th century.
  Table 1: Mean Male Income by Race
       1940-1980 (1984 dollars)

Census Year White Men         Black Men         Ratio
   1980     $ 25,791         $    18,723        73%
   1970     $ 25,666         $    16,527        64%
   1960     $ 19,959         $    11,483        58%
   1950     $ 14,332         $      7,912       55%
   1940     $ 10,459         $      4,531       43%
  By 1940, black income had increased from .37 to .43 of white
  income.
  Since 1940 the income of black men has improved absolutely and
  also relative to whites (2.2% vs. 3.5% per year).
  The post World War II period was one of advance by blacks.
Table 2: Black Male Wages as a Percent of
      White Male Wages, 1940-1980
   Years of
    Market
  Experience 1940        1950       1960          1970       1980
     1 to 5  46.7        61.8       60.2           75.1       84.2
    6 to 10  47.5         61        59.1           70.1       76.6
   11 to 15  44.4        58.3       59.4           66.2        7.5
   16 to 20  44.4        56.6       58.4           62.8       71.2
   21 to 25  42.3        54.1       57.6           62.7       67.8
   26 to 30  41.7        53.2       56.2           60.6       66.9
   31 to 35  40.2        50.3       53.8            60        66.5
   36 to 40  39.8        46.9       55.9           60.3       68.5
       All   43.3        55.2       57.5           64.4       72.6

 The table shows the changes in relative wages by work experience.
    Reading the table: A person in 1940 with 5 yrs. Experience earned 46.7% of
     a white person with the same experience.
    What happened to this person as he continued to work?
    You can follow an individual’s life by moving diagonally along the table.
Table 2: Black Male Wages as a Percent of
      White Male Wages, 1940-1980
   Years of
    Market
  Experience 1940         1950        1960          1970       1980
     1 to 5  46.7         61.8        60.2           75.1       84.2
    6 to 10  47.5          61         59.1           70.1       76.6
   11 to 15  44.4         58.3        59.4           66.2        7.5
   16 to 20  44.4         56.6        58.4           62.8       71.2
   21 to 25  42.3         54.1        57.6           62.7       67.8
   26 to 30  41.7         53.2        56.2           60.6       66.9
   31 to 35  40.2         50.3        53.8            60        66.5
   36 to 40  39.8         46.9        55.9           60.3       68.5
       All   43.3         55.2        57.5           64.4       72.6

 It is commonly posited that only younger blacks benefited from the improvement
 in black incomes that occurred in the post World War II era.
      What do the numbers in the chart suggest?
      As black workers progress in their careers, their relative wages increased.
      Young as well as older blacks benefited from the general improvement in
       black relative wages.
Table 2: Black Male Wages as a Percent of
      White Male Wages, 1940-1980
    Years of
     Market
   Experience 1940        1950       1960          1970       1980
      1 to 5  46.7        61.8       60.2           75.1       84.2
     6 to 10  47.5         61        59.1           70.1       76.6
    11 to 15  44.4        58.3       59.4           66.2        7.5
    16 to 20  44.4        56.6       58.4           62.8       71.2
    21 to 25  42.3        54.1       57.6           62.7       67.8
    26 to 30  41.7        53.2       56.2           60.6       66.9
    31 to 35  40.2        50.3       53.8            60        66.5
    36 to 40  39.8        46.9       55.9           60.3       68.5
        All   43.3        55.2       57.5           64.4       72.6
From 1940 to 1980, black wages increased 52% faster than whites.
Largest improvement occurred during the 1940's, slowed during the 1950's and
increase during the 1960's and 1970's.
Common story of black wage stagnation is not correct.
Evidence that Civil Rights Movement and increased Black Voter Participation was
not responsible for increased black income because improvement occurred before
Civil Rights Movement.
 Table 3: Extent of Overlap Between Black
      and White Income Distributions
                Percent of Black Men         Percent of White Men
               Whose Income Exceeds         Whose Income Exceeds
                White Income at the:          Black Income at the
               Bottom          Top         Bottom          Top
    Year       Quarter Median Quarter      Quarter Median Quarter
    1980         56     29      10           87     70      45
    1970         45     22      5            90     78      57
    1960         38     12      1            92     81      66
    1950         36     12      2            92     82      66
    1940         31      8      1            95     84      70

Note: The way to read the chart is as follows. In 1980, only 10% of
black men had an income that exceed the income of a white man
whose income was in the top 25% of the income distribution. In 1980,
29% of black men had an income that exceeded the median income of
white men.
      Table 3: Extent of Overlap Between Black
           and White Income Distributions
                         Percent of Black Men             Percent of White Men
                        Whose Income Exceeds             Whose Income Exceeds
                         White Income at the:              Black Income at the
                       Bottom          Top               Bottom          Top
          Year         Quarter Median Quarter            Quarter Median Quarter
          1980           56     29      10                 87     70      45
          1970           45     22      5                  90     78      57
          1960           38     12      1                  92     81      66
          1950           36     12      2                  92     82      66
          1940           31      8      1                  95     84      70
In 1940, the U.S. was truly a nation racially divided.
Black and white men were truly divided into two separate and unequal societies and the
upper segments of society were an exclusive white male club.
Because people associate primarily with those in the same socio-economic groups, white
elites had little contact with blacks. Most of the black/white interaction occurred at the
lower income levels.
  Table 3: Extent of Overlap Between Black
       and White Income Distributions
                    Percent of Black Men            Percent of White Men
                   Whose Income Exceeds            Whose Income Exceeds
                    White Income at the:             Black Income at the
                  Bottom          Top              Bottom          Top
      Year        Quarter Median Quarter           Quarter Median Quarter
      1980          56     29      10                87     70      45
      1970          45     22      5                 90     78      57
      1960          38     12      1                 92     81      66
      1950          36     12      2                 92     82      66
      1940          31      8      1                 95     84      70

70% of white men earned more than the top 25% of blacks in 1940.
In 1940, only 1% of black men had an income greater than the Top Quarter of
white men. In 1940, only 1% of black men had an income greater than the Top
Quarter of white men.
By 1980, the income distributions had converged greatly.
    Black penetration into the economic elite and glass ceiling arguments.
Black Middle Class-29% of black men earned more than the median white.
   Table 4: Men in the Middle Class

                       White                        Blacks
                       Middle                       Middle
  Year       Below     Class    Above     Below     Class    Above
  1980        11        60       29        20         68      12
  1970         9        66       25        24         71       5
  1960        12        64       24        39         59       2
  1950        18        49       23        48         50       2
  1940        30        40       30        76         22       2

Table shows the percentage of blacks and whites above, below and within
the middle class.
Table 4 shows:
    the persistence of black poverty,
  growth of the Black middle class

  the recent emergence of a non-negligible black upper class.
  Table 4: Men in the Middle Class

                    White                      Blacks
                    Middle                     Middle
  Year      Below   Class    Above    Below    Class    Above
  1980       11      60       29       20        68      12
  1970        9      66       25       24        71       5
  1960       12      64       24       39        59       2
  1950       18      49       23       48        50       2
  1940       30      40       30       76        22       2

From 1940 to 1980, the bulk of Blacks have moved from the lower
to the middle class.
For the first time in history, a sizable number of black men are
better off than white middle class.
       Table 5: Percentage Increase in Black
      Annual Income Compared with Whites at
                Selected Percentiles
            Percent                 Percent   Increase in income was fairly
Percentile Increase   Percentile   Increase   broad based with roughly even
    2         4.8        60          54.9     changes across experience and
    4         8.4        70          57.4     income levels except for those
    6        30.7        80           49      in the very bottom of the
    8        36.9        90          46.2     income distribution.
   10        48.1        92          50.6
                                              Do those in the bottom of the
   20        48.2        94          48.1
                                              income distribution have some
   30        50.2        96          51.6     type of developmental or
   40        45.2        98          54.7     behavioral problem which
   50        45.5                             limits income?
Table 6: Percentage Growth in Black-White
       Male Ratios of Weekly Wages

                    Growth Between
   Years of Work
    Experience   50-40   60-50   70-60   80-70   80-40
       1 to 5     28.1    -2.7    22.1    11.5    58.9
      6 to 10     25.1    -3.2    17.1    8.8     47.8
     11 to 15     27.1    1.9     10.9    10.4    50.3
     16 to 20     24.4    3.1     7.3     12.5    47.3
     21 to 25     24.6    6.3     8.6     7.7     47.2
     26 to 30     24.2    5.6     7.5     9.9     47.2
     31 to 35     22.5    6.6     10.8    10.4    50.3
     36 to 40     16.4    17.5    7.5     12.7    54.2
         All      24.2    4.1     11.3     12     51.6
Table 7: Percentage Growth in Black-White
Weekly Wage Ratios by Education

                                   Years of Schooling
  Decade     0 to 4   5 to 7   8 to 11     12     13 to 15   16+
 1940-1980   35.5     36.5      30.8      32.8       45      44.8
 1940-1950     5      14.4      16.6      22.3      14.4     10.8
 1950-1960   12.9      5.5      -2.2      -6.8       6.9     10.4
 1960-1970    2.8      8.5        7        8.7      17.6     19.3
 1970-1980   15.1      8.1       7.4       8.6       6.2     4.3
Data Sources
Value of Freedom
How Did Blacks Fare Compared to Whites-Late 19th Century
How Did Blacks Fare Compared to Whites-Early 20th Century
The Improvement in Black Relative Incomes-
              1940-1980.
What was the role the Civil Rights Movement, election reform,
affirmative action and desegregation?
  Was the causality:

       Government legislation caused the improvement in black
        welfare.
       Improvement in black welfare caused the government
        legislation.
       Factors other than government action caused the
        improvement in black welfare.
What was the nature of the improvement in black incomes?
  Was the improvement broad based or was it limited to
     specific segments of the black population?
       Age, education, and experience.
What can income distribution data reveal about the nature of
race relations in the U.S?
   Civil Rights, Government Action, and Black
                     Welfare.
 Table 1: Mean Male Income by Race 1940-1980 (1984 dollars)
                                          Percent of Change
Census                                    Occuring before
 Year    White Men Black Men     Ratio    Date
 1980    $ 25,791 $ 18,723        73%            100%
 1970    $ 25,666 $ 16,527        64%             72%
 1960    $ 19,959 $ 11,483        58%             49%
 1950    $ 14,332 $      7,912    55%             41%
 1940    $ 10,459 $      4,531    43%
  Timing argument similar to the used by McKeon in the nutrition debate.
  School desegregation, voting rights reform, affirmative action, and civil
  rights legislation occurred after much of the improvement in relative black
  welfare.
     Therefore, these could not be the sole or primary cause of black relative

      improvement.
  Other factors must be identified.
The Nature of the Improvement in Black
Relative Incomes.

   The increase in incomes affected:
     Young and old blacks.

     Experienced and inexperienced blacks.

     Educated and uneducated blacks.

     And led to the rise of a large black middle class

      and a significant black upper class for the first
      time.
   See Tables 2-7 from previous lecture.
Income Distributions and the Nature of Race
           Relations-1940-1980
                  In 1940, there was little overlap between
                  the black and white income distributions.
                  The majority of blacks were concentrated
                  at what would be the lower end of the
                  white income distribution.
                  Since people primarily associate with those
                  from the same socio-economic class there
                  was little contact between blacks and
                  whites in 1940.
                  This effect was especially pronounced at
                  the higher income levels.
Income Distributions and the Nature of Race
           Relations-1940-1980

                   By 1960, 49% of the improvement in black
                   relative income had already occurred
                   (Table 1).
                   For the first time, middle, upper middle,
                   and upper class whites had significant
                   contact with blacks.
                   Despite the improvement, there was still
                   little contact among upper class whites and
                   blacks.
Income Distributions and the Nature of Race
           Relations-1940-1980

                   By 1980, there had developed a significant
                   black middle and upper class.
                   For the first time, upper class whites had
                   significant contact with upper class blacks.

								
To top