Capitalism and Slavery Debate is not about differences in methodology

Marc Perry wrote about the ongoing argument over the relationship between slavery and the American economic development that is taking place between some economic historians (economists) and some new historians of capitalism (historians)  Some people, including the author of this essay at the Economist, view the argument as a controversy over differences in methodology between economists and historians. Several of the quotes by historians in Parry’s article seem consistent with this view. 

Personally, I do not view it as an argument about methods between historians and economists. The economists, including myself, who have criticized the work of Baptist and Beckert have focused more on their poor use of historical methods than their poor use economic methods.

There is no universally accepted description of appropriate research methods in history or economics. People within disciplines often argue about the appropriate methodology for the discipline. Nevertheless, I think that most historians would agree that good historical work presents an accurate historiography, so the reader understands the current state of the conversation on the topic, and builds an interpretation of the past based upon an honest and critical interpretation of the sources. Economic historians have criticized Baptist and his supporters for failing to follow these practices, for failing to do good history. I haven't criticized Baptist and his supporters  for not having a formal model or not doing econometric analysis. I have criticized them for misrepresenting what economists and historians have written and said about slavery. I have criticized them for creating interpretations of the past that are based upon made up stories and numbers rather than actual sources.

Misleading historiography.

One of the chief claims of Baptist and his supporters is that they have overturned a long held view of the slave economy of the South as stagnant and pre- or even anti- capitalist. This is one of the central claims of The Half. In Parry’s article, Edward Ayers echoes Baptist’s claim to novelty. “What’s exciting about that approach is the way it renders the slave South as a dynamic, changing society, in contrast to Genovese’s static, anti-capitalist vision, says Edward L. Ayers, a historian and former president of the University of Richmond. "To have that overturned so quickly," he says, "it looks more like the sciences than it does the humanities."” But these claims to have overturned long held views about slavery in the United States are based solely upon a misleading historiography.

It is simply a myth that Genovese’s view of the economics of slavery was held by the majority of economists or historians until Baptist and Beckert cam along. While I think it can safely be said that Genovese’s work on culture, such as Roll, Jordan, Roll remains relevant, his work on the economics of slavery, expressed in the Political Economy of Slavery has long been discounted by both economists and historians. Consider the interpretation of the South presented in an undergraduate text book three decades ago: George Brown Tindall’s America: A Narrative History Volume, 2^nd edition (1988). Tindall wrote on page 371 that “More often than not the successful planter was a driving newcomer, bent on maximizing profits. While the profitability of slavery has been a long standing subject of controversy, in recent years, economic historians have reached the conclusion that the slaves on average supplied about a 10 percent return on their cost.” He went on to note that slaves were the most profitable investment available in the South, and that incomes in the South were not only comparable to the wealthiest countries in the World, but that in the newer cotton lands incomes were among the highest in the United States. The view that he presented to undergraduates almost 30 years ago was of a thriving and successful southern economy based on slave labor. There is no indication that he thought this was a controversial interpretation. 

Tindall was not an outlier, the interpretation in his textbook was the standard one among. In 1995, Robert Whaples surveyed a sample of both economists and historians who worked on economic history. He asked them whether they generally agreed, agreed with provisos, or generally disagreed with a series of statements. For the statement “Slavery was a system irrationally kept in existence by plantation owners who failed to perceive or were indifferent to their best economic interests,” ninety-three percent of economists and ninety percent of historians disagreed with the statement. For the statement “The slave system was economically moribund on the eve of the Civil War,” ninety-eight percent of economists and ninety-five percent of historians disagreed.

It is not just the claims about the nature of slavery in the American South that Baptist and his supporters misrepresent. I argued in another blogpost that Baptist’s entire argument against Rhode and Olmstead is about misrepresenting their argument. Beckert also claims an inordinate amount of novelty for his argument about the role of force (“war capitalism”) by choosing not to cite works like Findlay and O’Rourke’s Power and Plenty.

Creating interpretations of the past that are not based on evidence.

The claims about the size of the economic impact of slavery have not been based upon the available evidence. For instance, "The slave economy of the Southern states had ripple effects throughout the economy," Beckert wrote, "not just shaping but dominating it." Or according to Baptist “ All told more than $600 million, or almost half of the economic activity in the United States in 1836, derived directly or indirectly from cotton produced by the million odd slaves― 6 percent of the total US population―who in that year toiled in labor camps on slavery’s frontier.” Beckert makes the claim that slave produced cotton was the driving force based upon its predominant role among exports, and Baptist simply makes up the numbers that he uses to make his “estimate.”

In contrast, economic historians have noted that

1. Cotton was the largest export from the U.S., but exports were only about 9 % of GDP. Similarly, cotton accounted for about 23 % of income in the South, but the South accounted for only 26% of U.S. income. See D. A. Irwin, “The Optimal Tax on Antebellum U.S. Cotton Exports,” Journal of International Economics 60(2003):287) Ultimately, the value of cotton production was equal to about 6% of GDP.

2. The South had lower average incomes than the North; and per capita income was growing more slowly in the South even before the Civil War. See Unequal Gains by Lindert and Williamson Chapter 5. In addition, about twice as many people lived in the Union states.

3. The more important slavery was in a country or state the lower the level of income was in the future. Nathan Nunn “Slavery, Inequality and Economic Development in the Americas: An Examination of the Engerman-Sokoloff Argument (October 2007).

4. Slave states had lower levels of educational attainement and less innovation (measured by patents) than states without slavery. This was true even in the areas that were most like the North in geogrpahy and economic activity. See John Majewski "Why Did Northerners Oppose the Expansion of Slavery? Economic Developemnt and Education in the Limestone South" Chapter 14 in Slavery's Capitalsm.

Foner complains that for the economic historian history “is just a source of numbers, a source of data to throw into their equations." History is not just a source of numbers, but, if you are going to use numbers, shouldn’t they come from history, not the historian’s imagination? The current dispute is not about economic methods versus historical methods; it is about bad history. Because it is about bad history, it is all the more disappointing when historians like Foner, who know better, are willing to stand behind it. After his NYTimes review of Baptist's book I wrote a post titled "et tu Foner?"

Economic historians have criticized Baptist and his supporters because they are doing bad history. By the way, throughout this post I have used the phrase Baptist and his supporters not historians because I do not believe that they represent the discipline of history. There is far too much really good work being done to take the worst work as representative of the discipline. More than a few historians have questioned his historiography, his propensity to make things up, and his use of sources (see for instance this Historically Thinking podcast). After reading Slavery’s Capitalism I am not even convinced that Baptist and his supporters represent people who regard themselves as historians of capitalism.

Caitlin Rosenthal, for instance, said she would like to promote more cooperation between economists and historians (and I thought her paper in Slavery's Capitalism was consistent with this statment). Carlo Cipolla long ago noted that there are differences between economists and historians, but he argued these differences should complement not conflict with each other. Mary and I recently argued in the Journal of Institutional Economics that economists had much to gain by paying more attention to the historian’s craft. Finally, Kevin O’Rourke pointed out on twitter that the economic history department at Oxford has both economists and historians, and they seem to get along just fine.


Note: This post was edited on 11 December 2016 to add point number 4 in the list above and the reference to John Majewski's paper on the Limestone South.