Skip to main content

4. The Colonists ’ Choice of Agricultural Labor in Early America

Published onApr 08, 2020
4. The Colonists ’ Choice of Agricultural Labor in Early America
·

Following the European Voyages of Discovery, the New World was ultimately populated with Old World peoples, pathogens, plants, and animals. The African and European peoples who settled in North America set in motion interchanges of organisms that critically altered its regional disease ecologies. The changes in disease ecologies were not uniform; climate and geography affected which diseases would predominate in the various regions of North America, and these changes affected the economic possibilities of settlers. Consequently, an explanation of the settlement of America requires the integration of economic motives, the ecological consequences of economic actions, and the feedback effects of a changed ecology on economic possibilities.

Here we provide our explanation (model) of the colonists’ choice of servile labor in Early America.1 The options available to colonialists in seventeenth and eighteenth-century British North America were between African slaves and European indentured servants. Servile labor (both indentured servants and slaves) has to be economically and financially viable in the long run or it will not last. Furthermore, businesses that do not return to entrepreneurs all their costs, including “normal” returns (profits) to invested assets and in-kind inputs (such as labor and management skills) will cease operating in the long run. All inputs into the production process will receive, at the minimum, their opportunity costs or they will migrate to other employments; this is true for physical capital and labor, and it is true for both servile and nonservile labor.

Economic Considerations in the Choice of Servile Labor

“Firms” in the British North American colonies primarily consisted of commercial farmers (planters) who were in the business of providing agricultural goods primarily to the markets in Britain and secondarily to other markets. In the early British colonies, commercial farmers were heavily engaged in the production of sugar in the West Indies and tobacco in the Upper South. These enterprises depended on bound servile labor, indentured servants (almost exclusively of European ancestry) and slaves (almost exclusively of African ancestry). Whether a colonial planter chose to use slaves or servants as labor depended on the relative costs and revenues of employing them. We explain in simplified terms the economics involved in a colonial planter’s decision.

Economic models can be used to predict the behavior of profit-seeking firms. Given that New World planters were competitive (price takers) in both the markets to which they sold and in markets from which they bought, then, in the long run, competition would force down prices to the minimum of the typical firm’s (planter’s) average costs. These costs include normal returns to inputs (labor, capital, land, and enterprise). When the market price equals average cost (at the profit-maximizing rate of output) the firm stays in the market and continues producing because all factors of production (inputs) are earning what they reasonably could expect to be earning in their next best alternative. In the economist’s jargon, all inputs are earning their opportunity costs when a firm operates at the minimum of its average costs.

If, at a market price for the output where other firms are just covering opportunity costs, an individual firm uses an innovation (technique or input) that yields economic profits (returns greater than opportunity costs), one would expect that other firms would emulate the profitable one and the innovating process would spread throughout the industry. As more and more firms in the sector (agriculture) adopt these procedures, there would be an increase in product supply at the initial price (where opportunity costs were just being met for all firms except the one earning the economic profits). Eventually only firms that use the technique or inputs that the innovative firm introduced will be able to cover average costs, because the increase in output caused by the spread of the lower cost innovation results in an increase in supply and lower market prices.2

There are reasons why innovative firms (in this case, planters) in a competitive (price-taking) industry may not worry about keeping innovations secret. If a neighbor adopts the low-cost methods, the increase in output that comes about because of the adoption will have a negligible effect on the market price of the output being produced. In competitive price-taking markets, no individual producer or a small set of producers can affect the market price of the output. For example, an individual tobacco producer, or a combination of a handful of them, in the Chesapeake region of eighteenth-century colonial America would have had no an appreciable impact on the price of tobacco in Europe. The combined output of a handful of colonial producers could not affect market conditions sufficiently to move prices.

Competition for profits leads firms to adopt profitable innovations, and the innovations lead to an increase in output that causes a reduction in price. After the innovation is fully digested only firms using the innovating techniques will be covering opportunity costs (making normal profits); firms that resist the innovations will be unprofitable and fail to exist in the long run. In terms of the provision of labor to the British North American colonies, if servants and slaves are equally productive (after deducting their maintenance costs), then in the long run profit-maximizing colonialists will exclusively utilize the cheaper source of labor. This analysis presents a problem because the British colonialists used both servants and slaves even though servants were, on average, cheaper for much of the colonial era.

Financial Considerations in the Choice of Servile Labor: The Costs of Slaves and Servants

To a colonial planter, bound servile labor is just another form of capital; like physical capital (land, equipment, animals, structures, and so forth), indentured servants or slaves are durable inputs that provide streams of net revenue into the future (total revenues attributable to the assets less the costs of upkeep and maintenance). To acquire a servant or slave a colonial planter has to bear the acquisition cost (or purchase price) of servile labor in the present, but he receives most of the revenues that the labor yields in future years. Because indentured servants and slaves are long-lived—they are productive beyond the present period—the concept of present value is necessary to understand the demand for servile labor. Present value allows colonial planters to determine what the stream of net revenue that servile labor produces in the future is worth now. To decide whether to purchase bound labor, and what type of labor (indentured servants or slaves), the planter must compare an outlay made now with a stream of net revenues extending years into the future. To make this comparison, the planter has to (implicitly, if not explicitly) determine the present discounted value of the stream of net revenues that the servile labor produces throughout its working period, typically extending years into the future.3

The present value of any durable asset depends on (1) the annual amount of net revenue that the asset produces (the productivity or quality of the asset), (2) when the revenues are received (for example, one year from the present or ten years), (3) how many years the stream of future revenues is received (the durability of the asset), and (4) the interest rate (the opportunity cost of capital).4 Knowing the discounted present value of future receipts allows their comparison with expenditures in the present. The value of any amount (£1) in the present is always more than the value of the same amount (£1) received in the future; this is because there is an opportunity cost for the use of capital over time.

We begin by clarifying and simplifying several issues in the development of our model of the choice of servile labor. First, the New World planters were price takers. This means no individual producer could affect (1) interest rates (the opportunity cost of capital), (2) the prices of the inputs they purchased (here we are concerned with the prices of slaves and servants used in the production of crops—we are explicitly confining the analysis to unskilled agricultural labor), and (3) the prices of the outputs they produced (primarily, sugar and tobacco). These observations are an accurate depiction of the observational reality that prevailed in the financial, labor, and output markets in the colonial period. No individual planter could affect the market prices for inputs or outputs by altering how much he individually would buy or sell. In terms of basic economics, the supply curves of inputs (labor) bought by the individual firms (farmers and planters) were horizontal at the going market prices (they were perfectly elastic). Similarly, the demand curves for the outputs that were produced were horizontal to the individual firm at their market prices. The market demand and supply curves were appropriately sloped, but the individual producer was too small an economic actor to affect prices.

Second, for now we assume that the net productivity of the two types of labor (servants and slaves) was the same. The assumption of equal net productivities means that either the maintenance costs (the costs of clothing, food, and shelter, among others) of slaves and servants were identical or that the type of labor with greater productivity also had sufficiently greater maintenance costs to ensure that net yields (earnings) were the same. Later on, we argue that an assumption of equal productivities of the two types of labor is incorrect, and is contradicted by biological, financial, and medical evidence. The reason we begin with the assumption of equal productivities is to highlight the implications of the assumption.

Third, we assume average uncertainty; this means that planters knew the average (mean) price of the output produced and the average (mean) economic life of all assets including labor. This is a simplifying assumption that allows us to concentrate on the economic and financial decision-making with certain knowledge. Any other assumption would be arbitrary and make the economic and financial calculations intractable.

Now suppose a colonial planter knew (1) the net revenue stream for labor (by assumption, the net productivities of slaves and servants are identical), (2) how many years the revenue stream will last for each type of labor, (3) the price of slaves and the price of servants, and (4) the market rate of interest. Knowing these parameters, it becomes a relatively simple exercise to determine the relative profitability of slaves versus servants. For example, suppose that a servant can be employed for 5 years, costs £10, generates a net income of £2.5 per year, and the interest rate is 10 percent per annum; next suppose a slave costs £20, lives for 20 years, generates the same net income of £2.5 per year, and the interest rate is the same 10 percent per annum. It is now a matter of calculating the present values of the two income streams (one for servants and one for slaves) and comparing the values to their acquisition costs (prices).5 The discounted present value for a slave earning £2.5 per year for 20 years is £21.28 at an interest rate of 10 percent; for a servant working for 5 years, the present value of its income stream is £9.48. In this example, the purchase of a slave is economically viable because the present value of its net revenues are greater than its purchase price, while the purchase of a servant is uneconomic because its purchase price is greater than the present value of its net revenues (£9.48). The purchase prices of labor (£10 for a servant and £20 for a slave) represent the costs of acquisition; the net present values (£9.48 for a servant and £21.28 for a slave) are equal to the present value of their future earnings.6

Notice the critical nature of the interest rate. Suppose that a slave works and lives for 100 years and that the price of the slave rises to £30. In this situation, the purchase of a slave is uneconomic because the present value of the 100 years of earnings (slightly less than £25) is less than the cost of the slave. Increasing the working life of a slave 400 percent (fivefold) does not offset a 50 percent increase in the price of the slave. This is because revenues to be received in the distant future are more highly discounted relative to prices and costs paid immediately. Since slaves were purchased in the present, every £1 paid for a slave now (year t = 0) has a present value of £1, and this is much greater than the present value of £1 received, for example, 25 years from now (year t = 25). The present value of £1 to be received in 25 years is only £.09 at a 10 percent interest rate. If instead the interest rate were 5 percent, the present value of £1 received 25 years in the future increases to £.295 now.

Historically we know within reasonable bounds slave prices, servant prices, and interest rates. Slave prices fluctuated relatively more than servant prices while interest rates fluctuated less than the prices of labor. Throughout most of the existence of the North American slave trade the prices of slaves were substantial, averaging about £20 for most of the seventeenth century, £25 to the mid-eighteenth century, and over £35 from the mid-eighteenth century to the American Revolutionary War. Table 4.1 and figure 4.1 reproduce Bean’s (1975) estimates of five-year average British-American slave prices from 1633–37 to 1773–75.7 In table 4.1, we also include the most recent data on slave prices available from Eltis, Lewis, and Richardson (2005, p. 679); these data are based on the sale prices of 228,877 enslaved Africans sold between 1674 and 1807. The data represent sales of males normalized for sale in Jamaica. Eltis, Lewis, and Richardson reduced the prices of slaves sold in what became the United States by 5 percent because shipping costs to the mainland colonies were higher than to Jamaica and their slave prices are normalized for sale in Jamaica. (Their data are explained more completely in Eltis and Richardson 2004, pp. 183–85.) The Eltis, Lewis, and Richardson (2005) time series is not as complete for the seventeenth century as Bean’s, but it is the most recent, and the data are based on the largest number of actual slave sales. Despite the time difference between when the two studies were conducted (one is 1975, the other is 2005), the data are in close agreement. (The five-year periods for each price observation do not exactly overlap for the two sets of data.) We rely on the Bean data because they offer a more complete coverage of the colonial time period and we wanted a series that was gathered in a consistent manner. The slave prices in Eltis, Lewis, and Richardson (2005), however, are in constant pounds, normalized for prime age males (as are the Bean data), and they are based on a very large amount of data. Regardless, if we were to use the Eltis, Lewis, and Richardson (2005) data rather than the Bean (1975) data, it would have an immaterial effect on the trend in slave prices.

<p>Table 4.1</p><p>Five-year average slave prices in the British colonies, normalized for males in Jamaica</p><p></p><p>Sources: Bean (1975); Eltis, Lewis, and Richardson (2005).</p><p>Note: While both the Bean and the Eltis, Lewis, and Richardson slave prices are reported as five-year averages, the last slave price reported by Bean is actually for a three-year average and the first slave price reported by Eltis, Lewis, and Richardson is actually for one year only. In the Bean data, the “number of sources” is in parentheses and refers to the number of reference materials that Bean used to derive slave prices. Typically each source reports on the sale of many slaves. In the Eltis, Lewis, and Richardson data, the “number of slaves sold” is in parentheses.</p>

Table 4.1

Five-year average slave prices in the British colonies, normalized for males in Jamaica

Sources: Bean (1975); Eltis, Lewis, and Richardson (2005).

Note: While both the Bean and the Eltis, Lewis, and Richardson slave prices are reported as five-year averages, the last slave price reported by Bean is actually for a three-year average and the first slave price reported by Eltis, Lewis, and Richardson is actually for one year only. In the Bean data, the “number of sources” is in parentheses and refers to the number of reference materials that Bean used to derive slave prices. Typically each source reports on the sale of many slaves. In the Eltis, Lewis, and Richardson data, the “number of slaves sold” is in parentheses.


<p>Figure 4.1</p><p>British and American slave prices: five-year average prices between 1633–1637 and 1773–1775. Note: The slave prices are reported as five-year averages except for Bean’s last reported price, which is the average for a three-year period only. Source: Bean (1975)</p>

Figure 4.1

British and American slave prices: five-year average prices between 1633–1637 and 1773–1775. Note: The slave prices are reported as five-year averages except for Bean’s last reported price, which is the average for a three-year period only. Source: Bean (1975)

The prices of indentured servants are more problematic than those of slaves.8 Servants voluntarily indentured themselves to pay for their passage to the New World. The costs of transporting an indentured servant or a paying passenger were virtually identical.9 Because the price of passage was relatively high, indentured servants, in effect, had to borrow to finance their voyages. To repay the shipper, servants agreed to bind (indenture) themselves for a fixed period of time. Since the cost that all servants borrowed to undertake the voyage was the same (transportation costs per servant did not vary regardless of their ages and skills), the individual characteristics that affected each servant’s productivity was reflected in the length of time that the servant had to endure to pay off the costs of the voyage. Servant productivities varied by the servant’s skills, sex, and health (among other factors); consequently, the length of the indentureship reflected not only the costs of the passage across the Atlantic but the estimated productivity of the individual servant. Before agreeing to indenture themselves, servants bargained with the shipper over the length of their indentureship. These negotiations resulted in longer indentureships for younger and unskilled servants, and shorter ones for healthy and skilled servants.

In order to compare the financial merits of acquiring a servant versus a slave, one has to know servant prices. Grubb (2000, p. 103) lists the mean prices of indentured servants for Philadelphia and Baltimore for various years. In Philadelphia for a sample of 471 servants for the years 1745 to 1746, the mean price was £8.56 with a mean indentureship of 4.41 years; during the years 1771 to 1773, the mean price was £8.58 for a sample of 956 servants with a mean indentureship of 3.99 years. In Baltimore, Grubb (2000, p. 103) reports that the mean price for a sample of 125 servants for the years 1767 to 1768 was £8.82 (data on the length of the contract were not available). These mean prices, though, were affected by the characteristics of the servants, their destinations, and the time of year.10 Galenson (1981a, pp. 97–106) also reports on servant contracts in colonial America, estimating that the mean indenture contract for an illiterate 20-year-old male bound for Pennsylvania (his reference category) was 56 months for the 1718 to 1759 period. He likewise estimates the effects of age, gender, location, and skill levels on the length of the contract, with an additional four months added on for being 18 years old. In his discussion of servant prices, Galenson (1981a) indicates that the mean price of servants with four years (48 months) remaining on their contract was £8.95, the median £9, and the modal price £10 (p. 100).

The price we use is £12. This price is an adjustment to the servant prices found in Galenson (1981a) and Grubb (2000). Using Galenson’s mean price of £8.95 (the highest of the various mean prices) as a starting point, and increasing it by 25 percent to adjust for an 18-year-old having to serve 25 percent longer (60 months rather than 48), yields a servant price for an 18-year-old male of £11 (£11.18 to be exact). Atack and Passell (1994, p. 45) contend that £11 was the price that a purchaser had to pay a shipper for a servant with the following characteristics: an illiterate male, 18 years old, unskilled, and suitable for agricultural labor (an appropriate comparison to the alternative of the purchase of the typical African slave); the length of indentureship for a servant with these characteristics in colonial Pennsylvania was five years. The prices of servants reported in the literature, however, are biased downward as measures of the cost of servants because they do not reflect the “freedom dues” and other benefits (typically clothes) that were more than occasionally awarded to servants at the completion of their indentureship. Since these benefits were awarded at the completion of the indentureship, the benefits have to be discounted to get their present value. The acquisition of a servant required an outlay of currency at the time of purchase (we use £11) and another outlay (freedom dues) five years later. To adjust for these freedom dues, an additional £1 was added to the £11 price that the purchaser had to pay to approximate the present value of the freedom dues that were paid to the servant after completion of the indentureship.11 Servant prices were relatively constant, while slave prices fluctuated substantially. With a servant price of £12, a slave priced at £20 cost 66 percent more than a servant; at a £25 price the slave cost 100 percent more than a servant and at £35 the slave cost nearly 200 percent more than a servant.

Interest rates do and did fluctuate. The best compendium for what we know about colonial interest rates comes from Homer and Sylla (1991); their summary table for the colonial period has interest rates in colonial British North America varying from 5 to 10 percent per year (p. 279). The lowest rates mentioned in Homer and Sylla are not market rates but regulated or government-set interest rates. Benjamin Franklin is quoted as saying that prevailing interest rates in Philadelphia were 6 to 10 percent. We cannot say with any certainty what interest rate prevailed at a specific time, so we have made calculations using interest rates varying from 5 to 10 percent. We are reasonably confident that colonial interest rates were within these bounds. The reader can assess how sensitive the calculation of profitability is to changes in the interest rate with our data.

Summarizing, in order to compare the relative financial merits of acquiring a servant or a slave, one has to know (1) the interest rate that applies to the purchase of agricultural capital, (2) the prices of slaves and servants, (3) the net revenues each produces, and (4) the length of time that servants and slaves would be producing revenue. Now, once again, suppose that the annual net revenue of slaves is constant and identical to that of servants, and the interest (discount) rate applied to the acquisition of a slave or a servant is also the same. The average price of slaves varied over time. For convenience, we analyze four alternative prices for slaves: (1) a (low) price of £20 consistent with the approximate average of British-American slave prices during much of the seventeenth century, (2) a price of £25 consistent with the price prevailing in the eighteenth century to circa 1750, (3) a price of £30 that is used for comparison, and (4) a (high) price of £35 consistent with prevailing prices post-1750 to the beginning of the Revolutionary War.12

We analyze five contingencies for the length of time a slave laborer provided net revenues: 7 years, 12 years, 16 years, 20 years, and 25 years. Seven years is the estimated life expectancy of newly arrived African slaves in the West Indies; we use this later to elaborate on the health effects of tropical regions. Twelve years corresponds to some estimated slave life expectancies after arrival in New England in the early to mid-eighteenth century, 16 years corresponds to some estimated life expectancies of slaves after arrival in the Philadelphia area, and 20 and 25 years are considered a moderate upper bound and an extreme upper bound, respectively. Obviously, the longer a slave works the more financially advantageous an investment in a slave is at any given interest rate.

Figure 4.2 shows what we are trying to accomplish in its simplest form. In figure 4.2, we have only two labor options: one is the purchase of a slave for £35 who has a working life of 25 years (the line with diamonds on it); the second is the purchase of an indentured servant for £12 whose indentureship lasts for 5 years (the line with boxes on it). The vertical axis measures the annual returns necessary to amortize (to repay the principal plus interest) the capital investment in labor over its working life (British pounds is the unit of measure). The horizontal axis represents various interest rates. The line with diamonds represents the annual returns required to repay the purchase price and interest of a slave with a price of £35 and a working life of 25 years (see table A.4, col. E0 = 25, in appendix A).13 For example, at an interest rate of 8 percent, a slave must yield £3.279 of net revenue per year to repay (amortize the principal and interest) an investment of £35 in slave capital. The line with boxes shows the net returns required to repay an investment of £12 in an indentured servant whose indentureship is for five years. Where the boxed line lies below the diamonded line delineates the interest rates where investments in servant capital are more profitable than those in slave capital. Conversely, interest rates where the amortization payments for slave capital (diamonded line) are below those of servant capital (boxed line) are those interest rates where slave capital is more profitable. The intersection point of the slave and servant lines is the critical interest rate where the relative profitability of an investment in the two forms of human capital change.

<p>Figure 4.2</p><p>Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £35, slave work life = 25 years; servant price = £12, servant work life = 5 years</p>

Figure 4.2

Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £35, slave work life = 25 years; servant price = £12, servant work life = 5 years

Figures 4.3 through 4.6 illustrate the relationship between interest rates, the length of service, and the minimum net returns per year that have to be earned for a slave or a servant to be profitable. The calculated net returns per year are for slave prices of £20 (figure 4.3), £25 (figure 4.4), £30 (figure 4.5), and £35 (figure 4.6); and for a servant price of £12 (in each figure). (The calculated net returns for all cases are reported in tables A.1 through A.5 in appendix A.) Each figure shows the returns that had to be achieved per year at a given interest rate for the slave purchase to be completely amortized (the original investment repaid plus interest charges) at the specified rate of interest. The calculations were carried out for interest rates of 5 through 10 percent. Different slave life expectancies (expected working lives) are shown as different line segments labeled E7, E12, E16, E20, and E25 for the length of services 7, 12, 16, 20, and 25 years, respectively. Each figure also depicts the annual amount necessary to amortize a servant, whose price is £12 and indentureship is 5 years, at varying interest rates; the servant line is the boxed line in each figure.

<p>Figure 4.3</p><p>Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £20, slave work life = <em>E</em><sub>0</sub> years; servant price = £12, servant work life = 5 years</p>

Figure 4.3

Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £20, slave work life = E0 years; servant price = £12, servant work life = 5 years


<p>Figure 4.4</p><p>Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £25, slave work life = <em>E</em><sub>0</sub> years; servant price = £12, servant work life = 5 years</p>

Figure 4.4

Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £25, slave work life = E0 years; servant price = £12, servant work life = 5 years


<p>Figure 4.5</p><p>Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £30, slave work life = <em>E</em><sub>0</sub> years; servant price = £12, servant work life = 5 years</p>

Figure 4.5

Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £30, slave work life = E0 years; servant price = £12, servant work life = 5 years


<p>Figure 4.6</p><p>Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £35, slave work life = <em>E</em><sub>0</sub> years; servant price = £12, servant work life = 5 years</p>

Figure 4.6

Annual returns necessary to amortize a slave or servant at various interest rates: Slave price = £35, slave work life = E0 years; servant price = £12, servant work life = 5 years

Figures 4.3 through 4.6 reveal in basic terms the details of the financial aspects of investment in servile labor in British North America. The figures show that at the same interest rate it was only at very low slave prices, or alternatively, at moderate slave prices it was only at relatively low interest rates, that the profitability of a slave was as high as that of a servant. (Note that the line segment E7 for a seven-year slave life—the life expectancy of a slave in the West Indies—is unambiguously the least profitable in each figure at all indicated interest rates; the case of the West Indies is discussed below.) Under an assumption of profit seeking, if servants were more profitable, then only servants would be purchased, and conversely if slaves were more profitable, only slaves would be purchased.

The figures indicate that under the regime of the actual prices of slaves and servants that prevailed during most of the seventeenth and eighteenth centuries, the purchase of a slave was not profitable under the assumption of equal productivities of slave and servant labor (see also tables A.1 though A.5 in appendix A). Here observational reality intrudes. Our analysis implies that only if the present value of slaves and of servants were equal at the prevailing market rate of interest would both servants and slaves be imported; this is very unlikely given the changing prices of slaves and changing interest rates. Yet historically we know that both slaves and servants were imported and employed throughout the colonial period; thus the predicted outcome of only observing either slave or servant imports (not both) at a particular time is contradicted. Recall that these predictions are made under the assumption that servants and slaves were equally productive; we believe this assumption is false. Historical market data are not consistent with the assumption’s implications, and because there are many observations that exist for servant prices, slave prices, and interest rates during the colonial era, the overwhelmingly likely reason why slaves were purchased despite their higher prices is that slaves were more productive than servants in certain regional environments of British America.

The calculated returns for slave labor in the West Indies (E0 = 7) shown in figures 4.3 through 4.6 and reported in appendix A (tables A.1 through A.4) are illustrative. If we assume that European servants had the same productivity in the West Indies as African slaves and that servants lived out their indentureships, then there is no reason profit-seeking planters would consider slave labor. The payments to amortize the purchase of slave labor in the West Indies dwarf those for servants at all interest rates. Even supposing that servants had a preference for not going to the West Indies, involuntary servants (convicts) would be sent there if someone were willing to buy them. There were some convicts sent to the British West Indian colonies, but the majority were sent to and purchased in the North American mainland colonies. This is indicative that slaves, despite their higher capital costs, were more profitable in tropical disease environments than were European servants; African slaves were more productive there.

The Role of the Disease Environment in the Choice of Servile Labor

A profit-seeking colonial planter would have compared the expected purchase price of servile labor to the expected present value of its stream of future net revenues (earnings). The planter would have acquired an indentured servant (or a slave) if the expected present value of the net revenue stream was greater than the expected purchase price. In addition to the standard factors (age, experience, skills, and so forth) that affect labor productivity, the productivity of servile labor and its expected net revenue stream in colonial America depended on the health and life expectancy of the laborer, because labor productivity, at least in part, was dependent on the risk of illness (morbidity) and the risk of death (mortality). In turn, the morbidity and mortality of slaves (Africans) and servants (Europeans) depended critically on the disease ecology in which they lived and worked in the New World. Disease ecologies were region specific to the New World.14

Microbiology and evolutionary theory explain why morbidity and mortality differed across populations of different ancestral heritages and differed regionally and locally. Africans and Europeans had disparate biological reactions to the different disease (microparasite) environments that evolved across regions of the British New World. While disease environments and populations interact over time, particular disease organisms are not universal. Diseases evolve in specific environments; an organism that is virulent to humans in one locality or at a particular time may be mild or nonexistent in another location or time. Human populations also evolve and are specific to given areas: a population native to a given region has lived and reproduced in the disease environment specific to that area. Natives of a region will tend to be relatively resistant to the diseases that predominate in their local environment and relatively susceptible to the disease environment of a different and distant location.

Once Africans and Europeans were introduced into the Americas, and their numbers grew beyond a threshold level, a biological process was set in motion that led to irreversible changes in the disease environment across the North American New World. The biological process involved the introduction of Old World pathogens carried over by Africans and Europeans; some of these pathogens survived and became endemic in areas where the environment was suitable for them. As a result different regional disease environments evolved. In New England, cold-weather diseases predominated, primarily those involving upper respiratory infections. The disease environment changed to a mixture of cold-weather and warm-weather diseases as one traveled south on the mainland. In the southern mainland colonies, the disease environment was a mixture of the diseases that were in New England and in the tropical Caribbean. In the Caribbean, the disease environment consisted almost entirely of warm-weather diseases, primarily various fevers and intestinal nematodes. This process was path dependent: the initial labor supply choices, whether because of accident or design, changed the biological environment irreversibly.15

The changed disease environment had economic consequences for colonial America; the productivity of labor, and the lifetime productivity of Africans and Europeans changed after both migrated. The altered disease ecology led to regional differences in morbidity and mortality based on a population’s ancestral heritage. Over time the current and the lifetime productivity of Africans and Europeans became sufficiently dissimilar across different regions in America that they could no longer be regarded as close substitutes in unskilled agricultural tasks in the same region. This view of changing labor productivity is in sharp contrast to the existing literature on the transition to slaves in the Caribbean and Chesapeake. The literature treats African slaves and European servants generally as close substitutes in unskilled agricultural tasks—only relative costs mattered for the choice of labor.16 Yet this assumption is contradicted by the data that show that despite widely disparate relative prices, both servants and slaves were imported throughout the colonial period as agricultural laborers, albeit—and this is the crucial point—not in the same geographies.

Specifying the exact temporal sequence of changing morbidity and mortality requires information and data that do not exist. An exact explanation necessitates placing our economic and biological model of the choice of servile labor in a dynamic framework, which in turn requires specifying the exact biological interaction and time sequence of the introduction of the Old World diseases into different regions of the North American New World. This specificity is unknown and perhaps unknowable. Nevertheless, we can indicate the factors that generally affected the interaction and time sequence and, by inference, reproduction and selection. Changes in the morbidity and mortality rates for Africans and Europeans would have depended on (1) the location where they lived, (2) the nature of their acquired immunities before they arrived in the New World, (3) how morbidity and mortality rates change in response to the current and past patterns of the employment of Africans and Europeans, and (4) any relevant exogenous factors.17 The evolutionary process that leads to changes in morbidity and mortality rates over time is, among other factors, a function of the interactions among different populations (and again, by inference, reproduction and selection) and disease environments. The specifics of the actual biological and historical consequences that resulted from the European Voyages of Discovery to British North America and the subsequent labor choices of colonial planters are examined in the next chapter.

Concluding Thoughts on the Choice of Colonial Labor

The migration of Old World biological organisms (humans, diseases, and parasites) changed the New World ecologies, which in turn altered the rates of morbidity, mortality, and labor productivity for the populations that went to the various regional environments of colonial America. These consequences in combination with economic factors (in particular, interest rates and relative prices of servile labor) provide the evidence for our explanation of the subsequent choices of agricultural labor and the regional concentration of peoples of different ethnicities (ancestral heritages) in seventeenth-century British North America. The results of these labor choices materially affected the history of the United States from its colonial origins, through the Civil War (the bloodiest war fought in the Western Hemisphere), continuing to the present. Contemplating the effects of minute, mindless organisms upon history should be enough to contradict any thoughts that “we are masters of our fate.” Human hubris is invisible under microscopic examination.

License
Copyright © 2011 Massachusetts Institute of Technology. (All rights reserved.)
Comments
0
comment

No comments here