Did Slavery Impede the Growth of American Capitalism? Two Natural Experiments Using Farm Values per Acre

Francis, Joseph A. (2025): Did Slavery Impede the Growth of American Capitalism? Two Natural Experiments Using Farm Values per Acre.

Abstract

Two natural experiments challenge the view that slavery impeded the growth of American capitalism. An event study shows that farm values fell relative to the national average in slave states following abolition. A spatial regression discontinuity design (RDD) then suggests that any negative effects of slavery’s legality on farm values on the free-slave state border were counteracted by the institution’s practical utility. An explanation of these results can also be advanced: slavery provided a relatively cheap agricultural labor force in parts of the South where white Americans preferred not to settle. From this perspective, the growth of American capitalism was promoted rather than impeded by slavery.

• Item Type: MPRA Paper
• Language: English
• Keywords: economic history, event study, spatial regression discontinuity design, slavery, United States
• Subjects: J - Labor and Demographic Economics > J4 - Particular Labor Markets > J47 - Coercive Labor Markets; N - Economic History > N1 - Macroeconomics and Monetary Economics ; Industrial Structure ; Growth ; Fluctuations > N11 - U.S. ; Canada: Pre-1913; N - Economic History > N2 - Financial Markets and Institutions > N21 - U.S. ; Canada: Pre-1913; N - Economic History > N5 - Agriculture, Natural Resources, Environment, and Extractive Industries > N51 - U.S. ; Canada: Pre-1913; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O43 - Institutions and Growth

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