Antibellum Economy Economics

 Prior to the civil war, Eli Whitney created the Cotton Gin, an invention that not only helped invigorate the cotton industry in the American South, it also helped greatly increase the slave trade. With the abolishment of slavery after the Civil War and the gradual decline of Southern wealth in the Postbellum era, it is worth studying what actually happened to the cotton trade after the dust settled. 

According to "The Postbellum Demand for Cotton Revisited", cotton was in quite high demand after the civil war. This was rather surprising at a glance- between America's diminished population and diminished wealth after a particularly destructive war, one might come to the conclusion that demand for most goods would go down, but this was not the case- European factories had lower supplies after a costly war, and needed more than ever, but this demand was difficult for the war-impoverished south to achieve- it was not a product of a lack of free involuntary labor, but rather a product of poor landowners being unable to generate enough crops with their already tattered economy.

"Legacy, location, and labor: Accounting for racial differences in postbellum cotton production." Notes that black-owned farms in the postbellum period produced significantly more cotton than white-owned farms, concluding that this was due to the legacy of slavery- the white farmers knew how to force slaves to work, they did not know how to work as well as the black farmers, who knew precisely what they were doing. It was a case of the slaveowners becoming rather complacient in their command, and subsequently losing their control, and therefore their relevance in the cotton industry of the time.

"THE "LOCK-IN" MECHANISM AND OVERPRODUCTION OF COTTON IN THE POSTBELLUM SOUTH." details how poor farmers were forced into an unfair commodity trading system that traded copious amounts of cotton and kept corn elusive, keeping cotton prices low at the cost of farmer independence. This system took advantage of the weakened economy of the American south to create a pseudo-caste system, with debtors above farmers.

Bibliography

Craft, Erik D., and James Monks. 2008. “The Postbellum Demand for Cotton Revisited.” Explorations in Economic History 45 (2): 199–206. doi:10.1016/j.eeh.2007.12.002.

Canaday, Neil, and Matthew Jaremski. 2012. “Legacy, Location, and Labor: Accounting for Racial Differences in Postbellum Cotton Production.” Explorations in Economic History 49 (3): 291–302. doi:10.1016/j.eeh.2012.05.002.

Ransom, Roger, and Richard Sutch. “The ‘Lock-In’ Mechanism and Overproduction of Cotton in the Postbellum South.” Agricultural History 49, no. 2 (Spring 1975): 405–25. https://search.ebscohost.com/login.aspx?direct=true&db=31h&AN=45984034&site=ehost-live&scope=siteLinks to an external site..