Sunday, November 7, 2010

The Value of Slaves

I was looking for a way to explain to students why the institution of slavery turned into such a major fight, and the easiest way to do so is to put the price of slaves into a modern context.  The value of a prime field hand (a man in his early 20s) in 1850 was about $800.  Gold was $20 per ounce at the time, so today, that would be equivalent to about 50x that, or $40,000 in current money.  A prime field hand was therefore about as valuable an economic asset as a new BMW 335i sedan. There's a nice graph showing how the value of a male slave rose and then fell with age in 1850.  An average slave might be worth $400 in 1850, or the equivalent of a new Chevrolet Impala today.

The large slave owners might have hundreds of slaves--and the work that they did is what made a large slave owner wealthy.  Without those slaves, even a planter's land was worth far less, because free labor would not have been anywhere near as cheap. 


Allen Cogbill said...

Well, at the current price of gold (~$1400/oz), 20 oz of gold would be $70,000 rather than $40,000. And, the owner has to provide food, clothing, and shelter.

Seems to me that this is a rather expensive proposition. I think the problem is that slavery became an ingrained institution before large-scale European immigration began. Such immigrants were substantially cheaper than slaves from everything I've ever read. However, by the time such immigrants began to appear, slavery was well-entrenched in the South.

bombloader80 said...

I would disagree with your statement, based on what I read about the Post Civil War economy. As I recall, sharecropping evolved because it was significantly cheaper than simply hiring on former slaves as wage laborers. At this point, if free immigrant labor was in fact cheaper, you would expect a few planters to try to hire a bunch of Irish to replace their slaves at some point. Therefore, slavery probably was a better deal for the planter than using free wage labor for the same tasks.

Clayton said...

Actually, we don't know the exact reason slavery became common. There is some evidence that a shortage of free labor after the Great Fire of 1666 may have made slave labor more attractive.

Fogel & Engerman's work suggests that return on investment of slaves was perhaps as high as 8% annually--which is a decent return for the antebellum period.