Refresher: The Traditional Economic View of Slavery Recall the - PowerPoint PPT Presentation

Refresher: The Traditional Economic View of Slavery Recall the traditional value of slavery that would be challenged by Fogel, Engerman and others that followed: Slavery was an unprofitable investment Slavery was a dying institution Slave labor was economically inefficient Slavery retarded the growth of the southern economy Slavery provided extremely poor living conditions for the typical slave (in terms of consumption, health and physical abuse) J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 1 / 31

Is there now consensus among economists? J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 2 / 31

Population Growth and Redistribution J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 3 / 31

Population Growth in the United States US Population, 1790 ‐ 1990 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 0 1790 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 4 / 31

Population Growth in the United States ln(US Population), 1790 ‐ 1990 20 19.5 19 18.5 18 17.5 17 17 16.5 16 15.5 15 1790 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 5 / 31

Population Growth in the United States US Population per Square Mile, 1790 ‐ 1990 80 70 60 50 40 30 30 20 10 0 1790 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 6 / 31

Population Growth in the United States US Urban and Rural Populations, 1790 ‐ 1990 200,000,000 180,000,000 Urban 160,000,000 Rural 140,000,000 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 1790 1800 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 7 / 31

Population Growth in the United States ln(urban pop) and ln(rural pop), 1790 ‐ 1990 20 20 19 18 17 ln(Urban) 16 ln(Rural) ln(Rural) 15 14 13 12 90 00 10 20 30 40 50 60 70 80 90 00 10 20 30 40 50 60 70 80 90 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 199 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 8 / 31

Why Study Population Growth? Population growth has been one of the main forces driving the growth of the economy Patterns of population growth over time and across space can tell us a lot about economic conditions and how people respond to them Aspects of population growth, including birthrates and death rates, give us important measures of welfare Understanding how population growth has influenced the past gives us a sense of what to expect in the future for the US and other countries J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 9 / 31

The Basics of Population Growth At the most basic level, population growth comes down to the birthrate and death rate for an economy The population will grow if the number of people born each year exceeds the number of people that die The bigger the gap between the birthrate and the death rate, the faster the population growth Anything that increases the birthrate (changes in marriage patterns, changes in fertility decisions, etc.) will tend to speed up population growth Anything that decreases the death rate (better nutrition, less war, etc.) will also tend to speed up population growth J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 10 / 31

Immigration and Population Growth For a closed economy, population growth is purely a function of birth and death rates However, most countries have either a net flow of people into the country or out of the country Immigration levels will influence population Immigration is going to have different effects on population change than simple birth and death rates: The gender ratio of immigrants isn’t necessarily 1 to 1 The age distribution of immigrants will alter the age profile of the population differently than changes in birthrates and death rates Immigrants may differ in characteristics and social norms compared to the native born population J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 11 / 31

The American Birthrate US Birthrate per 1,000, 1800 ‐ 1999 60 50 40 30 20 10 0 1800 1840 1865 1890 1911 1915 1919 1923 1927 1931 1935 1939 1943 1947 1951 1955 1959 1963 1967 1971 1975 1979 1983 1987 1991 1995 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 12 / 31

The American Fertility Rate Total fertility rate, 1800-2000 8 Number of children per woman 7 6 5 4 3 2 1 0 1790 1840 1890 1940 1990 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 13 / 31

The American Fertility Rate - Regional Differences N Number of children under 5 per 1,000 women age 10 ‐ 44 b f hild d 5 1 000 10 44 2000 1800 New England ‐ Urban 1600 1400 1400 New England Rural New England ‐ Rural 1200 East North ‐ Central ‐ 1000 Urban 800 East North ‐ Central ‐ Rural 600 600 West North ‐ Central ‐ 400 Urban 200 West North ‐ Central ‐ Rural 0 1800 1810 1820 1830 1840 1910 1920 1930 1940 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 14 / 31

Why are fertility rates higher in rural areas and the frontier? A common explanation is that on the expanding frontier, the abundance of land meant that there was plenty of economic opportunity if you could provide enough labor Children could provide valuable labor on the farm In addition, the greater land wealth of farmers made them more likely to have several children if providing inheritances matters to parents (target bequest model) An alternative to this idea of a target bequest model is a strategic bequest model in which parents want their children to take care of them when they are older J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 15 / 31

Children as a Source of Labor J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 16 / 31

Were children valuable on the farm? Contributions to Farm Family Income, 1860 Family Group Northeast Midwest Frontier Children, 0-6 ($20.82) $8.59 ($6.41) Children, 7-12 $22.81 $27.76 $27.12 Teenage females $22.95 $39.75 $17.53 Teenage males $111.03 $47.45 $49.03 Adult women $154.08 $70.25 $147.28 Adult men $294.77 $186.44 $193.66 J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 17 / 31

Children and the Target Bequest Model PRIMOGENITURE, SHARING, AND WEALTH DISTRIBUTION 309 TABLE III ESTATE PROPORTIONS BY BIRTH ORDER Two-children families (N = 31) First born Mean Standard deviation 0.491 0.052 Xi/W1 0.498 0.048 X2/W2 0.495 0.047 X3/W3 Three-children families (N = 30) Complete ordering (N = 19) Standard deviation First born Mean 0.127 X1/W1 0.329 0.342 0.090 X2/W2 0.339 0.091 X3/W3 Second born 0.317 0.069 XJ/Wj 0.067 X2/W2 0.312 0.310 0.066 X3/W3 Partial ordering (N = 11) Mean Standard deviation Earlier born J. Parman (College of William & Mary) American Economic History, Spring 2012 April 5, 2012 18 / 31 0.321 0.055 Xi/W1 X2/W2 0.334 0.079 0.336 0.081 X3/W3 Later born 0.331 0.096 Xi/W1 0.333 0.066 X2/W2 0.334 0.064 X31W3 Recent papers by Becker [1974] and Becker and Tomes [19761 attempt to explain private within-family transfers that augment both human and nonhuman capital. They hypothesize that transfers of nonhuman capital (bequests and gifts) are used to attenuate earnings differences among children and that, hence, the less able child will receive a larger compensatory bequest. The implication is that re- stricting material inheritance is disequalizing within, though certainly not between, families. At one point in the paper, Becker and Tomes [1976, p. S154] go so far as to state that nonhuman transfers will completely offset differences in the ability of children: