Managerial Strategies of the Cotton South

Saito, Tetsuya (2005): Managerial Strategies of the Cotton South.

Abstract

Relative efficiencies of antebellum slave farms are suggested by many empirical studies. This paper considers a theoretical aspect of those results using a repeated principal-agent problem. Within its theoretical analysis, with relevance to profitability of slave farms, it will be shown that when inter-temporal punishments are necessary and when they can perform efficiently in production. Applying those theoretical results, some empirical studies on relative profitability and relative efficiencies are discussed. In the empirical study, relative efficiencies of each farm scale—free farms, task farms, and gang farms—are estimated region by region by a stochastic profit frontier model.

• Item Type: MPRA Paper
• Language: English
• Keywords: Relative efficiency of antebellum slave farms; repeated principal-agent problem; profit maximizing contracts; stick and carrot on plantations
• Subjects: N - Economic History > N5 - Agriculture, Natural Resources, Environment, and Extractive Industries > N51 - U.S. ; Canada: Pre-1913; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games ; Evolutionary Games ; Repeated Games; J - Labor and Demographic Economics > J4 - Particular Labor Markets > J41 - Labor Contracts; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games

References

Aigner, D., K. Lovell, and P. Schmidt, “Formulation and estimation of stochastic frontier production model,” Journal of Econometrics, 1977, 6 (1), 21-37. Battese, G. E. and G. E. Coelli, “Prediction of firm-level technical efficiencies with a generalized frontier production function and panel data,” Journal of Econometrics, 1988, 38 (3), 387-399. Bauer, R. A. and A. H. Bauer, “Day to day resistance to slavery,” Journal of Negro History, 1942, 27 (4), 388-419. Bergstrom, T., “On the existence and optimality of competitive equilibrium for a slave economy,” Review of Economic Studies, 1971, 38 (1), 23-36. Chwe, M. S.-K., “Why were workers whipped? Pain in a principal-agent model,” Economic Theory, 1990, 100 (403), 1109-783. Conrad, A. H. and J. R. Meyer, “The economics of slavery in the antebellum South,” Journal of Political Economy, 1958, 66 (2), 95-130. David, P. A., H. G. Gutman, R. Sutch, P. Temin, and G. Wright, eds., Reckoning with Slavery, Oxford University Press, 1976. L. A. Craig, To Sow One Acre More: Childbearing and Farm Productivity in the Antebellum North, Johns Hopkins University Press, 1993. Domar, E. D. and M. J. Machina, “On the profitability of Russian serfdom,” Journal of Economic History, 1984, 44 (4), 919-955. David, P. A. and P. Temin, “Slavery: The progressive institution?,” Journal of Economic History, 1974, 34 (3), 739–783. David, P. A. and P. Temin, “Slavery: The progressive institution?,” in David et al, Ch. 5, 1976. Fenoaltea, S., “Slavery and supervision in comparative perspective: A model,” Journal of Economic History, 1984, 44 (3), 635-668. Field, E. B., “The relative efficiency of slavery revisited: A translog production function approach,” American Economic Review, 1988, 78 (3), 543–549. Field-Hendrey, E., “Application of a stochastic production frontier to slave agriculture: An extension,” Applied Economics, 1995, 27 (4), 363-368. Field-Hendrey, E. B. and L. A. Craig, “The relative efficiency of free and slave agriculture in the antebellum United States: A stochastic production frontier approach,” in D. Eltis, F. D. Lewis, and K. L. Sokoloff, eds., Slavery in the Development of the Americas, Cambridge University Press, 2004, pp. 236-257. Findlay, R., “Slavery, incentives, and manumissions: A theoretical model,” Journal of Political Economy, 1975, 83 (5), 923-934. Fogel, R. and S. Engerman, Time on the Cross: An Economics of American Negro Slavery, Boston, Little, Brown, 1974a. Fogel, R. and S. Engerman, Time on the Cross: Evidence and Methods - A Supplement, Boston, Little, Brown, 1974b. Fogel, R. and S. Engerman, “Explaining the relative efficiency of slave agriculture in the antebellum South,” American Economic Review, 1977, 67 (3), 275-296. Fogel, R. and S. Engerman, “Explaining the relative efficiency of slave agriculture in the antebellum South: Reply,” American Economic Review, 1980, 70 (4), 672-690. Fogel, R. W., Without Consent or Contract: The Rise and Fall of American Slavery, W. W. Norton & Company, 1989. Gutman, H. and R. Sutch, “The slave family: protected agent of capitalist masters or victim of the slave trade?,” 1976, in David et al, Ch. 3, 1976. Grabowski, R. and C. Pasurka, “The relative efficiency of northern and southern U.S. farms in 1860,” Southern Economic Journal, 1988, 54 (3), 598-614. Grabowski, R. and C. Pasurka, “The relative efficiency of slave agriculture: an application of a stochastic production frontier,” Applied Economics, 1989, 21(5), 587-595. Haines, M. R., and the Inter-university Consortium for Political and Social Research. HISTORICAL, DEMOGRAPHIC, ECONOMIC, AND SOCIAL DATA: THE UNITED STATES, 1790-2000 [Computer file]. ICPSR02896-v2. Hamilton, NY: Colgate University/Ann Arbor: MI: Inter-university Consortium for Political and Social Research [producers], 2004. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2005. Hofler, R. A. and S. T. Folland, “The relative efficiency of slave agriculture: A comment,” Applied Economics, 1991, 23 (5), 861–868. Levin, J., “Relational incentive contract,” American Economic Review, 2003, 93 (3), 835-857. Lowe, R. G. and R. B. Campbell, “The slave-breeding hypothesis: A demographic comment on the ”buying” and ”selling” states,” Journal of Southern History, 1976, 42 (3), 401–412. Miller, W. L., “A note on the importance of the interstate slave trade of the ante bellum South,” Journal of Political Economy, 1965, 73 (2), 181–187. Parker, W. N., and R. E. Gallman, SOUTHERN FARMS STUDY, 1860 [Computer file]. Compiled by William N. Parker, Yale University, and Robert E. Gallman, University of North Carolina. ICPSR ed. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [producer and distributor], 1991. Phillips, U. B., American Negro Slavery, Louisiana State University Press, 1918. Paperback edition published in 1966. Primack, M. L., “Farm construction as a use of farm labor in the United States 1850-1910,” Journal of Economic History, 1965, 25 (1), 114-125. Radner, R., “Repeated principal-agent games with discounting,” Econometrica, 1985, 53 (5), 1173-1198. Rees, R., J. Komlos, N. V. Long, and U. Woitek, “Optimal food allocation in a slave economy,” Population Economics, 2003, 16 (1), 21–36. Toman, J. T., “The gang system and comparative advantage,” Explorations in Economic History, 2005, 42 (2), 310-323.