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Sharecropping As An Understandable Market Response: The Post-Bellum South

Published online by Cambridge University Press:  11 May 2010

Joseph D. Reid Jr.
Joseph D. Reid Jr.
Affiliation:
University of Pennsylvania
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Extract

On the eve of the Civil War southern per capita real income was eighty percent of northern. Treating slaves as property, real income per free southerner was four percent greater and growing at the same rate as its northern counterpart. Southern per capita income was but fifty-one percent of the national average in 1880, and only slowly began to relatively advance after 1900.

Type
Papers Presented at the Thirty-second Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 33 , Issue 1 , March 1973 , pp. 106 - 130
Copyright
Copyright © The Economic History Association 1973

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References

Encouragement, assistance or valuable criticism were generously given by Richard Easterlin, Stanley Engerman, Robert Fogel, Gerald Gunderson, Claudia Goldin, H. Gregg Lewis, Donald McCloskey, Yakir Plessner, and Joel Williamson. Valuable help from the librarians of the North Carolina Department of Archives and History, the Archives of Perkins Library at Duke University, and the Southern Historical Collection at the University of North Carolina Library and National Science Foundation Grant GS 3262 enabled me to collect the tenancy contracts cited herein.

1 Cf. Wharton, Vernon L., The Negro in Mississippi, 1865–1890 (New York: Harper and Row, 1965)Google Scholar; Stampp, Kenneth M., The Era of Reconstruction, 1865–1877 (New York: Alfred A. Knopf, 1966)Google Scholar; and Williamson, Joel, After Slavery: The Negro in South Carolina During Reconstruction, 1865–1877 (Chapel Hill: University of North Carolina Press, 1965)Google Scholar. C. Vann Woodward deemphasizes racism's virulence in the immediate postbellum. in his view Bourbon and mercantile factions were naturally competing for post-redemption control. Both were neutral toward the Negro until the rise of serious agrarian protest in the 1880's made Negro disfranchisement mutually desirable to forestall future third party movements. See his Reunion and Reaction (Boston: Little, Brown, 1966)Google Scholar.

2 The major historical treatments of southern country stores are united in finding an absence of evidence of monopoly profits or of monopolistic control in the stores' records. See Bull, Jacqueline P., “The General Merchant in the Economic History of the New South,” Journal of Southern History, XXVIII (February 1952), pp. 37–59CrossRefGoogle Scholar; Clark, Thomas D., Pills, Petticoats, and Plows: The Southern Country Store (Norman: University of Oklahoma Press, 1964)Google Scholar; Woodman, Harold, King Cotton and His Retainers (Lexington: University of Kentucky Press, 1968)Google Scholar.

3 Employing a Cobb-Douglas agricultural production function, however, Stanley Engerman concluded that increased inefficiency in southern farming contributed at least as much to the relative income decline as war-time destruction. “Some Economic Factors in Southern Backwardness in the Nineteenth Century” (unpublished, University of Rochester).

4 Contract of January 29, 1866 from the Alonzo T. and Millard Mial Papers, North Carolina Department of Archives and History.

5 Contract of January 1, 1866 at Darlington District, South Carolina from the Bascot Papers (#916) in the Southern Historical Collection at the University of North Carolina Library, Chapel Hill, North Carolina.

6 Contract of January 1, 1866 from the Johnston-McFaddin Papers (#2489), Southern Historical Collection.

7 See I. F. Lewis' contracts for 1874 and 1894 in the Lewis Plantation Records (#2528), Southern Historical Collection.

8 See Wharton's description of the immediate postbellum in Mississippi, The Negro in Mississippi …, and.Williamson's parallel description of South Carolina, After Slavery ….

9 Pope, Christine F., “The Southern Homestead Act: A Punitive Measure” (unpub. M.A. Thesis, University of Chicago, 1962)Google Scholar; Gates, Paul W., “Federal Land Policy in the South, 1866–1888”, Journal of Southern History, VI (August 1940), pp. 303–30CrossRefGoogle Scholar.

10 Quoted in Brooks, Robert P., “The Agrarian Revolution in Georgia, 1865–1912,” Bulletin of the University of Wisconsin, History Series, III (1914), p. 45Google Scholar.

11 See Ransom, Roger and Sutch, Richard, “Debt-Peonage as a Cause of Economic Stagnation in the Deep South Following the Civil War,” Southern Economic History Project, Working Paper Series, No. 9 (Institute of Business and Economic Research, University of California, Berkeley, Sept. 1970), table 8, p. 19Google Scholar.

12 Chap. IV, “The Economics of Cotton in the Antebellum South”, (unpublished Ph.D. dissertation, Yale University, 1969)Google Scholar.

13 Robert Fogel and Stanley Engerman have criticized Wright's exclusion of farms with extremely nigh or low com/cotton ratios from his sample. If, as they believe, economies of scale encouraged relatively high cotton (low cotton) production on large (small) farms, Wright's sample band would bias inclusion toward super efficient small farms and super inefficient large farms with a consequent downward bias of estimated scale economies. See Fogel, and Engerman, 's “The Relative Efficiency of Slavery: A Comparison of Northern and Southern Agriculture in 1860,” Explorations in Entrepreneurial History, VIII (Spring 1971), pp. 364–65Google Scholar. A good review of prior debate over the existence of antebellum economies in cotton production is Woodman's, Harold D.Slavery and the Southern Economy: Sources and Readings (New York: Harcourt Brace & World, 1966)Google Scholar. See especially the selections authored by J. E. Cairnes, Lewis C. Gray, Ulrich B. Phillips, and Robert R. Russel.

14 See responses to the question, “Does the share system give satisfaction?” at the end of each state's “Report on the Cotton Production…” in Hilgard, Eugene W., ed., Report on Cotton Production in the United States (Washington: G.P.O., 1884)Google Scholar.

15 Richard C. Sutch and Roger L. Ransom, “Debt Peonage in the Cotton South…,” Table 7, and U.S. Census Office, Compendium of the Eleventh Census: 1890, (Washington, D.C.:G.P.O.), Part III, p. 590.

16 See Hilgard's description of Mississippi's “Labor System,” Report on Cotton Production…, p. 78; Hammond, M. B., The Cotton Industry: An Essay in American Economic History, Part I: The Cotton Culture and the Cotton Trade (New York: Macmillan, 1897), pp. 179Google Scholar, 187; Range, Willard, A Century of Georgia Agriculture, 1850–1950 (Athens, Georgia: University of Georgia Press, 1955)Google Scholar; Brooks “The Agrarian Revolution…”; Stampp, The Era of Reconstruction….

17 Janes, Thomas P., Annual Report of Janes, Thomas P., Commissioner of Agriculture for the State of Georgia, for the Year 1875 (Atlanta: 1875)Google Scholar, quoted in Ransom, Roger and Sutch, Richard, “Tenancy, Farm Size, Self-Sufficiency, and Racism: Four Problems in the Economic History of Southern Agriculture, Southern Economic History Project, Working Paper Series No. 8 (Institute of Business and Economic Research, University of California, Berkeley, Apr. 1970) pp. 75–76Google Scholar.

18 See Hilgard, Report on Cotton Production…, pp. 78–79.

19 For the first economist's reservations about agricultural tenancy and sharecropping, in particular, see Smith, Adam, The Wealth of Nations (New York: Modern Library Edition, 1937) pp. 367–68Google Scholar. Marshall, 's discussion is in Principles of Economics (8th ed.; New York & London: Macmillan, 1920) pp. 642–44Google Scholar.

20 A representative sample of condemnation is: Adams, Dale W. and Rask, Norman, “Economics of Cost-Share Leases in Less Developed Countries,” American Journal of Agricultural Economics, L (November 1968) pp. 935–42CrossRefGoogle Scholar; Bardhan, P. K. and Srinivisan, T. N., “Cropsharing Tenancy in Agriculture: A Theoretical and Empirical Analysis,” American Economic Review, LXI (March 1971) pp. 48–64Google Scholar; Bhagwati, J., The Economics of Underdeveloped Countries (New York: McGraw-Hill, 1966) pp. 152–57Google Scholar; Schultz, T. W., Transforming Traditional Agriculture (New Haven: Yale University Press, 1965) pp. 118–21, 167–68Google Scholar; and references cited in Cheung, S.N.S., The Theory of Share Tenancy (Chicago and London: University of Chicago Press, 1969)Google Scholar Chaps. 1, 3. Post-Marshall tenancy condemnations ironically often cite his analysis to support their reverse contention that landlords are exploiting tenants.

21 Cheung, ibid., Chap. 2; Marshall, Principles …; Johnson, D. Gale, “Resource Allocation Under Share Contracts,” Journal of Political Economy, LVIII (April 1950) pp. 111–23CrossRefGoogle Scholar.

22 “Some Risk is an Impetus to Sharecropping” (July 1971), currently being revised. This is an important generalization; Bardhan and Srinivisan reject Cheung's model because Cheung maximizes “… only from the landlord's point of view …,” “Cropsharing Tenancy …,” p. 52.

23 For such allegations see.Banks, Enoch M., “The Economics of Land Tenure in Georgia,” Studies in History, Economics, and Public Law, XXIII (1905)Google Scholar; Brooks, “The Agrarian Revolution …”; Stampp, The Era of Reconstruction …; Taylor, Paul S., “Slave to Freedman,” Southern Economic History Project, Working Paper No. 7 (University of California, Berkeley, January 1970)Google Scholar; all passim.

24 Brooks, “The Agrarian Revolution …,” p. 440.

25 Ibid., p. 458.

26 Human Factors in Cotton Culture (Chapel Hill: University of North Carolina Press, 1929) p. 163Google Scholar.

27 From the David Golightly Harris Books (M-982) in the Southern Historical Collection.

28 Ibid., entries of December 14 and 25, 1867.

29 From the indicated contracts of Charles H. Rice in the John D. Bivens Papers, Perkins Library Archives, Duke University.

30 From the indicated contracts of B. T. Blake in the Mial Papers, North Carolina Archives.

31 From the indicated contracts of Alonzo T. Mial, ibid.

32 From the indicated contracts of John Devereux in the Devereux Family Papers, Perkins Library Archives, Duke University.

33 From the indicated contracts of A. H. Arrington in the A. H. Arlington Papers (#3240) in the Southern Historical Collection.

34 From the indicated contracts of E. Dromgoole in the George C. Dromgoole Papers, Perkins Library Archives, Duke University.

35 In Hilgard, Report on Cotton Production …, Vol. II, p. 522.

36 The Negro in Mississippi …, pp. 69–70.

37 “The Agrarian Revolution …, pp. 484–93.

38 “Post-bellum Southern Rental Contracts,” Agricultural History, XVII (1943), pp. 125–27Google Scholar. South Carolina's average cotton yield, 1870–90, was 158 pounds per acre. Multiplying this by 30 acres (the size of a “one horse” farm) gives an average yield of 4740 pounds or cotton, of which the sharecropper retained half or 2370 pounds. At 10¢ per pound his average crop was worth $237. The reported side payment varied by $22, from $70 to $48.

39 Cf. Banks, “… Tenure in Georgia,” p. 87.

40 “Resource Allocation Under Share Contracts,” p. 118.

41 Share Tenancy, pp. 62–72.

42 Where contracts stipulate a fixed compensation in crop units rather than money, price uncertainty is always proportionately borne by each party.

43 Cheung, Share Tenancy, p. 64.

44 Banks’ prescient 1905 study of Georgia agriculture also recognized the important risk and supervision dimensions of alternative tenures. “Tenure in Georgia,” pp. 92–100.

45 Cf. responses to Hilgard's survey about the desirability of sharecropping, Report on Cotton Production….

46 These results and those following are illustrated and proved in my “Some Risk is an Impetus to Sharecropping.”

47 “The Agrarian Revolution …,” pp. 407–08.

48 The Negro in Mississippi …, pp. 51, 104–12.

49 Cotton Culture, p. 152.

50 Hilgard, Report on Cotton Production …, passim; Banks, “Tenure in Georgia,” p. 79; Wharton, The Negro in Mississippi, Chap. Ill, passim.

51 Brooks, “The Agrarian Revolution …,”p. 452; Wharton, The Negro in Mississippi …, p. 63.

52 Parallel reasoning is extremely suggestive for the analysis of why firms give stock options to top management and the growth pattern of franchisers.

53 During Southern Reconstruction the antebellum landowners’ opportunities to regain their lost political hegemony by responding swiftly to fluctuations in Federal policy may have put a high implicit value on their political participaton and led landlords to sharecrop so as to minimize income fluctuations occasioned by their (politically prompted) frequent inattention to agriculture.

54 From the Grimes Family Papers (#3357) in die Southern Historical Collection.