Tag Archives: United States

Cotton and Slavery in Antebellum America

Slavery was necessary for the United States’ cotton boom because productivity levels were not high enough to attract free labour.

The dominant view among economic historians is that American slavery was an unnecessary evil: nothing good came of it for the development of the United States after independence. Even if some reluctantly accept that the boom in cotton production may have had some benefits for Antebellum America, they argue that the cotton could have instead been produced by free labour. Here, however, I will argue that productivity levels were too low in cotton to attract free labour, so slave labour was a necessary evil for the cotton boom.

Continue reading →

Without Slavery in the United States, Would California Still Be in Mexico?

The Mexican-American War illustrates how important slavery was for the expansion of the United States.

Unless you are Mexican, it is easy to forget that California was not always in the United States, having been a part of Mexico until the Mexican-American War of 1846-48, after which it was annexed. Slavery had much to do with the origins of that war, since white settlers hoping to grow cotton on slave plantations had fought for the secession of Texas in 1836, and then supported its annexation by the United States in 1845; a disagreement over Texas’ western boundary would lead to war with Mexico the following year. My argument here, however, is that slavery was also crucial to the outcome of the Mexican-American war because the goods produced by slaves were essential to the United States’ healthy public finances, which allowed it to defeat its poorer neighbour. This blog post thus makes a small contribution to the ongoing debate about slavery’s role in the development of the United States in the long nineteenth century.¹

Continue reading →

An Open Source Update of the Buy-to-Build Indicator

4 Replies

The tendency toward buying other companies more than building new productive capacity continues in the United States

In a past life I had access to expensive databases of corporate statistics, which I used to calculate the buy-to-build indicator for the United States from the 1880s until 2012. In short, the buy-to-build indicator shows how much corporations are spending on buying other corporations (that is, on mergers and acquisitions) relative to how much they are spending on new productive capacity (fixed capital formation). It gives an indication of whether corporations prefer to expand by buying or by building.

Continue reading →