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Economic History Association

The Rise and Fall of Indentured Servitude in the Americas: An Economic AnalysisAuthor(s): David W. GalensonReviewed work(s):Source: The Journal of Economic History, Vol. 44, No. 1 (Mar., 1984), pp. 1-26Published by: Cambridge University Press on behalf of the Economic History AssociationStable URL: http://www.jstor.org/stable/2120553 .

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THE JOURNAL OF ECONOMIC HISTORYVOLUMEXLIV MARCH 1984 NUMBERI

The Rise and Fall ofIndentured Servitude in the Americas:An Economic AnalysisDAVID W. GALENSON

Indentured servitude appeared in Virginia by 1620. Initially a device used totransportEuropeanworkers to the New World, over time servitudedwindledasblack slavery grew in importance n the British colonies. Indentured ervitudereappeared in the Americas in the mid-nineteenthcentury as a means oftransportingAsians to the Caribbean ugar islands andSouth Americafollowingthe abolitionof slavery. Servitudethen remained n legaluse until its abolition n1917. This paperprovidesan economic analysisof the innovationof indenturedservitude, describes the economic forces that caused its decline and disappear-ance from the British colonies, and considers why indenturedservitude wasrevived formigration o the WestIndies during he time of the greatfreemigrationof Europeans o the Americas.

INDENTURED servitudeappearedin use in Virginia by 1620,littlemore than a decade after the initial British settlement of NorthAmerica at Jamestown. Servitude became a central institutionin 'theeconomy and society of many parts of colonial British America; aleading historianof indenturedservitudein the colonial period, AbbotEmersonSmith, estimated that between one-halfand two-thirds of allwhite immigrants o the Britishcolonies between the Puritanmigrationof the 1630s and the Revolution came under indenture.' Althoughit

Journal of Economic History, Vol. XLIV, No. I (March 1984). ? The Economic HistoryAssociation. All rightsreserved.ISSN 0022-0507.Theauthor s AssociateProfessorof Economics,Universityof Chicago,Chicago,Illinois60637,and is a ResearchAssociate, NationalBureauof Economic Research.He is gratefulto StanleyEngermanordiscussionsof the issues treated n this paper,and to AndrewAbel, YoramBarzel,James Buchanan,CharlotteErickson, Robert Fogel, Alice Galenson, RobertGallman,FarleyGrubb,JonathanHughes,MichaelJensen,Douglass North,JonathanPincus, Joe Reid,TheodoreW. Schultz, GordonTullock, and John Wallis for comments and suggestions. PatriciaCloudprovidedcapableresearchassistance.Earlierversions of the paperwerepresentedat a seminaratthe Centerfor Study of PublicChoice, VirginiaPolytechnicInstitute, at the EconomicHistoryWorkshop,Universityof Chicago,and at the LibertyFundConferenceon EconomicOrganizationin Theory and History,PortLudlow.Washington.July, 1983.' Abbot Emerson Smith, Colonists in Bondage: White Servitude and Convict Labor in America,

1607-1776 ChapelHill, 1947),p. 336.1


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2 Galensondwindled in importance over time, servitude continued to exist inmainlandNorth America until at least the fourth decade of the nine-teenth century. In that same decade, indenturedservitude was broughtback into large-scale use in the West Indies and parts of South Amer-ica.2 It remained n legal use in those areas until 1917.This paper will consider some of the central economic factorsunderlying he appearanceanddisappearanceof indentured ervitude nthe Americas. The following section will provide an economic analysisof the innovation of indenturedservitudeandof the problemsthe earlyEnglish settlers solved in order to make servitudea useful institution.Subsequentsections will thenconsiderhow andwhy servitudedeclinedin importance and disappeared from the English West Indies andmainlandNorth America during he late eighteenthandearlynineteenthcenturies, as well as why the institution was revived in the Caribbeanand South America n the mid-nineteenth entury. The broadpurposeofthis paper is an economic interpretation of specific institutionalchanges; the paper seeks to provide a basis for understandingtheeconomic forces that initially created and molded an institutionthatplayed a major role in American labor marketsfor three centuries, aswell as the forces that later led to the disappearanceof that institution.3

THE SEVENTEENTH-CENTURY ORIGINS OF INDENTURED SERVITUDEIN NORTH AMERICA

Perhaps the most critical economic problemfacing early investors inthe VirginiaCompanyand the settlersthey sent to North America n thedecade after 1607was that of recruitingand motivatinga laborforce. Aninstitutional solution to this problem, the system of indentured servi-tude, emerged after a series of experiments by the Company. A briefreview of the historical context within which the settlement of Virginiaoccurred,and of the sequence of adaptations ntroducedby the Compa-ny, will demonstrate how and why this solution was reached.Recent estimates indicate that a majority of all hired labor in

2 Indentured,or contract, labor was also used elsewhere in the nineteenthcentury, as, forexample,significantmovementsof boundworkersoccurredwithinAsia. This paperwill not treatthese episodes, but will focus only on migrations o the Americas.

3 Throughouthis paper, with reference to indentured ervitudethe term "institution"will beused broadly o refer to the sets of practicesandrules-including both statuteandcommon aw-thatgoverned he use of laborcontractswritten or specifiedperiodsandentered ntoby workers norder to finance migration.Contractsof servitude typically differed romhire laborcontracts nspecifying elatively ongterms-e.g., in the colonialperiod ouryearsor more-and by involvingagreaterdegreeof controlof the worker's ivingand workingconditionsby the employer,andfromdebt contractsof service infailing o provide orautomaticdissolutionof the agreement tanytimeupon repaymentof a stated principal sum by the worker. These differences tended to makeindentured ervitudea distinctivestatus at mosttimes and places,with a set of rulesand practicesspecific to it, although of course these mightdiffer among particular pisodes, or for a singleepisode over time.


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Indentured Servitude in the Americas 3preindustrial England was provided by "servants in husbandry"-youths of bothsexes, normallybetween the ages of 13 and 25, who livedand worked in the households of their masters, typically on annualcontracts.4In view of the pervasiveness of service in husbandryas asource of labor supply in seventeenth-century England, it is notsurprising hat the notion of moving that institution o Americaoccurredto members of the Virginia Company when the results of their initialefforts to recruit a sustained flow of adult workers to their colonyproved disappointing.5Several problems had to be solved, however,before the Englishinstitution could be successfully transplanted o theNew World; n their solutionlay the originsof the system of indenturedservitude.The most obvious of these problems was that of the transportationcosts of the settlers. Passage fares to Virginia n the early seventeenthcenturywere high relative to the annualwages of English servants inhusbandryor hired agriculturalaborers,and few prospective migrantswere able to pay the cost of theirvoyage out of theirown accumulatedsavings, or those of their families.6 Existing English capital marketinstitutionswere patently inadequateto cope with the problem,consid-ering difficultiesthat included the high transactionscosts entailed inmaking loans to individuals and enforcing them at a distance of 3,000miles. The VirginiaCompany'ssolution was to use its own fundsto fillthe gap left by this unavailabilityof capital from other sources-byadvancing the cost of passage to prospective settlers. The Company'sadvance took the form of a loan to the migrants,who contracted torepay this debt out of their net earningsin America.7

4 PeterLaslett, The WorldWeHave Lost, Second edition London,1971),Ch. 1;AnnKussmaul,Servants n Husbandry n Early ModernEngland (Cambridge,1981);also Alan Macfarlane,TheOriginsof English Individualism New York, 1979).5 On early attempts to attract settlers, and the VirginiaCompany'sdifficulties,see SigmundDiamond, "From Organization o Society: Virginia in the Seventeenth Century," AmericanJournal of Sociology, 63 (Mar. 1958),457-75; EdmundS. Morgan,AmericanSlavery, AmericanFreedom: The Ordealof Colonial Virginia New York, 1975),Ch. 4.6 The passage fare normally quoted until the middle of the seventeenthcenturywas ?6; forexample, John Smith, The Generall Historie of Virginia,New-England,and the SummerIsles(London, 1624), p. 162. A survey of wages in Cambridge,Canterbury,Dover, Exeter, Oxford,Westminster,Winchester,and Windsor or 1620 ounda rangeof dailywagesin skilled rades rom

12-20d.,and for unskilled aborers rom8-12d.; BritishLibraryof Politicaland EconomicScience,Records of InternationalScientific Committeeon Price History (Beveridge Price Commission).Implied annual wages for full-time skilled workers would be approximately?15-25, and forunskilledworkers?10-15. The wages of unskilled servants in husbandryn the teen ages wouldpresumablyhave been lower.For furtherdiscussion of the influenceof transportation osts relativeto incomeandwealthonthe form of migrations,see infra, "The Decline-and Revival-of IndenturedServitudein theAmericas."7 The largesize of the debt meant hat repaymentwouldnormally akelonger hanthe singleyearthat characterized the employment of farm servants in England. Thus although the earlyarrangements id not have all the characteristics f indentured ervitude hat would laterdevelop,one important lement of the indenturesystem-contracts binding he workerto a master for anumberof years-appeared at an early stage.


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4 GalensonUnder the first scheme in which Company funds were used to paytransportation osts, the migrantswere to work directly for the Compa-ny in Virginia. In return for passage to the colony and maintenancethere during heirterms of service to the Company,the workers were tobecome "adventurers" (investors) in the enterprise, with claim to ashare in the division of the Company's profits that was to occur at theend of seven years. This system had appeared in use by 1609.8Thearrangement, under which large groups of men lived and workedcommunallyunderquasi-military onditions, proved to be very unpopu-lar with the recruits. Conditions for the workers were hard. Oneobservercommented, in explainingthe colony's high rateof mortality,

that "the hardwork and the scanty food, on public works kills them,and increases the discontent in which they live, seeing themselvestreated like slaves, with greatcruelty."9 The response of some workerswas to runaway to live with the Indians. The Companyclearly felt thatthis actionthreatened he continued survivalof theirenterprise, or theyreacted forcefully to this crime. In 1612, the colony's governor dealtfirmlywith some recaptured aborers: "Some he apointed to be hangedSome burned Some to be brokenupon wheles, others to be staked andsome to be shott to death." The underlyingmotive of maintaining abordiscipline was apparent to an observer, who remarkedon the punish-ments that "all theis extreme and crewell tortureshe used and inflictedupon them to terrify the reste for Attempting the Lyke." Anotherrelated problemperceived by Company managerswas a lack of workeffort by their bound workers.'0 These difficulties of supervisingandmotivating the discontented workers led the Company to seek a newsolution to the labor problem.

By 1619a new system hadbeen introduced.New colonists boundfora termto the Companywere sent over at the Company's expense, andthe free planters of the colony were allowed to rent them from theCompany for a year at a fixed rate, in addition to providing theirmaintenance." The Company believed that this system would yieldthem a number of advantages. The dispersal of the groups of new8 Smith, Colonists in Bondage, p. 9. On this early scheme, see also J. R. T. Hughes, SocialControl in the Colonial Economy (Charlottesville, 1976), pp. 55-57.9 Alexander Brown, ed., The Genesis of the United States (Boston, 1890), Vol. II, p. 648.'? Morgan, American Slavery, American Freedom, pp. 74, 78." Thissystem wasclearlyused in 1619;SusanMyraKingsbury, d., TheRecordsof the VirginiaCompanyof London(Washington,D.C., 1933),Vol. III, pp. 226-27. It is not clearwhether t wasin useearlier.A regulation f Virginian 1616mentionsa covenantedobligation f "every farmer opay yearly into the [Company's]magazine or himselfand every man-servant, wo barrelsand ahalfa piece of theirbest Indianwheat";HistoricalManuscriptCommission,EighthReport,Vol. 2,No. 208,p. 31. Thepaymentmadeby the farmer orhimselfwasapparently rentalpayment or anallotmentof land from the Company(e.g., see Charles M. Andrews, The ColonialPeriod ofAmericanHistory[New Haven, 1934],Vol. I, p. 124),but it is notspecifiedwhether he payment obe madefor each servant was a rentalfee for a possible additionalallotmentof land or a rental

payment o the Company or the services of the servanthimself.


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Indentured Servitude in the Americas 5arrivalswas expected to improve both their healthand their industry,"for asmuch as wee findby experience, that were abundaunceof newmen are planted in one body they doe overthrow themselues ... byContagionof sicknes .. and Cause thereof, ill example of Idlenes."The new migrants'placement with establishedplanters would providethemwith a place to live immediatelyafterarrival,and the old planterswouldtrain them in the "vsuall workes of the Country," so that whentheir year of private service expired, they would "returne to thepublique busines and be able to instructed ther new Commers as theythemselues had bine instructed."'Yet this modificationapparentlyaggravatedsome existing problemsand created several new ones. By 1619 the tobacco boom hadbeguninVirginia, and the value of labor had risen sharply. The Company wasacutelyaware, in the celebrated words of the speaker of Virginia'sfirstHouse of Burgesses, that "Our principal wealth . . . consisteth inseruants."'3 Enticement of servants by private employers seems tohave occurred, for in 1619 the General Assembly ordered "that nocrafty or advantageousmeans be suffered to be put in practisefor theinticingawayethe Tenants or Servantsof any particularplantation romthe place where they are seatted;" in case of violations, the -governorwas "most severely to punish both the seducers and the seduced, andtoreturne hese latter into theirformerplaces."'4 Perhapsmoreseriously,the rentalarrangementntroducedan additionalprincipal-agent elation-ship, between the Company and the private planters, that became asource of concern to the Company.The Companyorderedthatplanterswere to be responsible for maintainingheir servants if the latterfell ill,andwere to be liable for rentalpaymentsto the Companyfor servantswho died, with the amountsto be determined"proportionably or theirlife time."'15The speed with which the system of rentalagreementswasabandonedwas probablya response to the Company'sperceptionof theinsufficient ncentives of the planters to protect the Company'sinvest-ment in the labor of their hiredworkers, not only in providingadequatemaintenanceand provisionfor health care in an environmentwhere allsettlers suffered extraordinarilyhigh rates of mortality, but also inpreventingrunaways.16

12 Kingsbury,Recordsof the VirginiaCompany,Vol. III, p. 226;also pp. 246, 257-58.'3 Ibid., p. 221."4 Ibid., p. 167.15 Ibid., p. 227.16 The difficultiesof devising rentalagreementsthat would providethe proper ncentivesforplanterswould havebeenenormous n view of the problems nvolved n determininghe presenceof negligenceby mastersin the case of deathor escape by servantsunderthe conditionsof highmortalityand poorcommunicationshatexisted in earlyVirginia.Sale of the contracts o masterswas thereforesuperiorto rental, and it appearsthat the VirginiaCompanyrealizedthis veryquickly,as the onlydefiniteevidenceof rentalsdatesfromthe sameyear-1619-in whichthe firstoutrightsales of servants'contractsoccurred.Rentalsdo not appearto have continued n later

years.


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6 GalensonThe rapid termination of the use of this rental arrangementwasapparentlya result also of the Company'srecognitionof an alternativeto the rental system that avoided the agency problem t had created.Aspart of an effort by a new group of Company officers to increaseVirginia'spopulation,transactions occurredin 1619 that containedtheessential elements of the indenture system; migrants, transportedatCompanyexpense from England to Virginiaand boundfor fixed termsof years, were sold outrightfor the durationof these terms to plantersupon the servants' arrival n the colony.'7 These bargainswere enthusi-astically received by the planters, and an early exampleof the indenturesystem's characteristic form on a quantitatively significant scale ap-

peared in 1620, when the Company sent to Virginia "one hundredseruants to be disposed amongst the old Planters."' The cost ofpassagewas advanced to the migrantsby the Company,andthe recruitsin turn promised to work for stated periods; in Virginia, title to themigrants' labor during these periods was transferred to individualplantersuponthe planters'reimbursement f transportation osts to theCompany.Thus by 1620the developmentof the transaction hatwas tobecome prevalent for English indentured servants for nearly twocenturies was complete as colonial planters obtained the services ofimmigrants or a specified time upon payment of a lump sum to animporter.

INSTITUTIONAL STRUCTURE AND WORK INCENTIVESUNDER INDENTURED SERVITUDE

Indenturedservitude therefore emerged as a new institutionalar-rangement hat was devised to increase labor mobility from EnglandtoAmerica.'9The colonizationof Americamade availablefor cultivation

17 Smith,Colonists nBondage, p. 12.Thecontract hatcameto be usedinthese bargainswas ofa type commonlyused in England or a variety of legal transactions,known as an indenture.18 Kingsbury,Recordsof the VirginiaCompany,Vol. III, p. 313.19 Lance E. Davis and Douglass C. North, Institutional Change and AmericanEconomicGrowth (Cambridge,1971), p. 211. Like its English counterpart,the system of service inhusbandry, in the early British colonies indenturedservitude increased labor mobility at arelatively ow cost, for it involved the migration nly of individualaborerswho werecurrently nthe labor orce. Unlikemost migratorymovements, the systemthereforedid not have to bear thecosts of transportationor "tied" movers in families,who wouldmakeno immediate ontributionto production.It mightbe arguedthat indentured ervitude was adapteddirectlyfromthe Englishsystem ofapprenticeship. ome connectionsdidexist. During1619-1622 he VirginiaCompany ent severalshipmentsof vagrantchildren o Virginia; heir passagehad been paidby the Cityof London, andin return he Companyagreedto placethem withplantersas apprentices; ee RobertC. Johnson,"The Transportation f VagrantChildren rom Londonto Virginia,1618-1622," n Howard S.Reinmuth,Jr., EarlyStuart Studies(Minneapolis,1970),pp. 137-51. This was an exampleof thecompulsorypowerof parishapprenticeship, n institutiondistinctfrom the older systemof craftapprenticeship; ee MargaretGay Davies, The Enforcementof EnglishApprenticeship Cam-bridge, Massachusetts, 1956), pp. 12-13. Yet servitude, in which a capital sum was initially


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Indentured Servitude in the Americas 7vast amounts of new land, and in those Americanregions where cropscould be grown that used this land to satisfy the demands of both thelarge English market and the European marketsthat lay beyond it, theresult was a marginalproductivityof laborconsiderablyhigher hanthatfound in English agriculture. Labor productivity in many parts ofcolonial America eventually proved to be sufficiently high to allowmany bound European workers to repay the cost of passage to thecolonies in periods of as little as four years. Yet when Englishcolonization of North America began, a difficultproblemexisted, aproblemof how workers unable to afford he cost of the passage fare outof their own savings could obtain the necessary funds. The require-ments of the situation, with the need for the emigrant o repay the fundsover anextended period from a location far distantfromEngland,posedenormousproblemsof enforcementfor prospectiveBritish enders, andit is not surprisingthat with the existing technology British financialinstitutions were inadequate to the task. As was seen in the abovedescription of the Virginia Company's early experiments, the initialsolution was for a largefirmdirectly engagedin colonialproductiontoadvancethe cost of passage to workers, who then became servantsofthe firm for a period agreed upon in advance, duringwhich the loanwould be repaid. The problems of motivation and supervision thatresultedfrom this scheme soon led the Company o rent out theworkersit transported o individualfarmers who producedon a smaller scale.Thismodifiedscheme was itself short-lived,as the Companyappearstohave perceived quickly the advantages of simply sellingthe workersitimportedto individualplanters for the period necessary for repaymentof theirloans, as specifiedin the workers' contracts. By doing this, theCompanyunambiguously ransferredall costs of laborsupervisionandenforcementof the contracts to the planters, ncludingall risks of capitalprovidedby the master to the servant (to be paid off by the servant's abor), posed verydifferentproblemsof contractenforcementand labormotivation handidapprenticeship,n whichthe initialpaymentwas made by the servant, with the master'sobligation, n the formof training, o be paidover the course of the agreement. Thus, althoughsome elements drawn from apprenticeshipinfluenced he development of servitude,the incentives of both masterand servant were quitedifferent n the two systems, and servitude was more than a transferof apprenticeshipo thecolonies.

Although ndentured ervitudewas primarily sedin orderto facilitatemigration, nce the legalbasis of the institutionhad been laid down it could also be used to improve the functioningofmarkets for credit for other purposes. Thus, for example, in 1640 a Barbadosplanter namedRichardAtkinsonborrowedthe sum of 2,000 poundsof cotton from JohnBatt. The agreementprovided"that if the said two thousandpoundsof Cotton shallnot be paiduponthe day aforesaid,thatthenandimmediatelyupondefaultof the saidpayment, t shall bee for the said JohnBatt,orhis assigns,to takethe body of me RichardAtkinson,servant orthe termeof sixe yeares, withoutany further trouble or sute of law . . ."; quoted in Vincent T. Harlow, A History of Barbados,1625-1685 Oxford,1926),p. 294. Although ndentured ervitudecould have been used in a widevariety of othersituations nvolvingdebt, that it was overwhelmingly sed for transportationwasclearlybecauseenforcing epaymentof debtswasrelatively nexpensivewhenborrowingwasdonelocally, and servitudewas thereforeunnecessary n these cases.


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8 Galensonloss fromsuch sources as the escape or deathof the servantduring hecontractperiod.Once the practice of outright sale of the contract had been estab-lished, a large firm no longer hadany significanteconomic advantage nmost aspects of servanttransportation nd supervision.The supervisionandenforcementof the labor contractscould apparentlybe done quiteefficiently by small planters responsible for only a small number ofservants. The capital requirementsfor Europeanmerchants who ad-vanced the funds to cover immigrant ransportationwere reduced fromthe full periodof time specified by the contractto the time between thesigningof the contract n Englandand its sale in the colonies (principallythe two to three monthsduringwhich the servantwas on the ship).Thecost of entry into the servant trade was low, and the industry soonbecame one in which many Europeanmerchants who tradedwith thecolonies participated.Work incentives for indenturedservants appearto have been morevaried in practice thana simple descriptionof the system's form mightimply. The question of incentives was a significantone, for the majorbenefit to the servant from the bargain-passage to America-wasprovided at the outset, before the servant had begun to work. EdmundMorganconcluded that physical violence was the principalmeans bywhich mastersextracted work fromservants n early Virginia;he arguedthat servants had little other reason to workhard, for few wished to berehired at the end of their terms, while masters lacked an incentive totreat their servants well for precisely the same reason, since it wasunlikely n any case thatthey couldinducetheirservantsto stay on aftertheirterms ended.20Andalthoughcoloniallaws protected servantsfromexcessive corporal punishment,and masters who killed their servantswould be tried for murder,mastersgenerallywere permittedconsider-able latitude in beating their servants.2' Yet it would be surprising fsevere physical abuse had been very common, for it would obviouslyhave interferedwith servants' work capacity, to the detrimentof theirmasters'profits. Significantpositive work incentives clearly existed forservants, and a variety of scattered evidence suggests the potentialflexibilityof the system in practice.Colonial laws generally guaranteedservants access to adequate food, clothing, and lodging, but manyplantersexceeded the minimum required levels in providingfor theirservants.22Similarlymasters could, and did, increasethe freedomduesthey gave to favored servants above the statutory minimumlevels.Wages were sometimes paid to servants duringtheir terms, and their

20 Morgan,AmericanSlavery,AmericanFreedom, p. 126.21 RichardB. Morris,Government nd Labor in EarlyAmerica(New York, 1965),pp. 461-500.22 Indeed, Gloria Main concluded that servants' material condition in seventeenth-centuryMarylandwas typicallyno worse than that of manysmallplanters;Main,TobaccoColony:Life in

EarlyMaryland,1650-1720(Princeton,1982), p. 113.


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Indentured Servitude in the Americas 9amounts could be varied. Masters could make bargains with theirservants under which the latter could be released early fromtheirtermsof servitude.23The frequencywithwhichthese positive incentiveswereused is difficult o determine,for within the operationof servitude t wasonly abuses by either masters or servants that were monitored bycolonialcourts, and thereforeof which systematiclegal recordssurvive.Occasional references do show, however, that some servantswere ableto accumulate significantwealth during their terms.24The judgmentofJohn Hammond, writing of the Chesapeake colonies in 1648, that"Those Servants that will be industrious may in their time of servicegaina competent estate before their Freedomes, which is usuallydoneby many," cannot be subjected to systematic test, and may have beenoverly optimistic. Yet it is likely that Hammond's description of theformof rewardsgiven to some servants, including ivestockand land onwhich to grow tobacco on their own account, came from actualobservation, and it is also plausible that, as he admonished, thesebenefits "must be gained . .. by Industryand affability,not by slothnor churlish behaviour.'25

THE EVOLUTION OF INDENTURED SERVITUDEIN COLONIAL BRITISH AMERICA

Indenturedservitude was an initial solution to an acute problemofobtaining a labor supply that existed in many regions of colonialAmerica, and the basic form of the institutiondeveloped by the VirginiaCompanywas widely adoptedandused throughout he British coloniesin the seventeenth and eighteenthcenturies.Althoughpreciseestimatesof the total numbersof servantsare not available,an indicationof theiroverall quantitativeimportance is given by Abbot Emerson Smith'sjudgment, noted earlier, that between half and two-thirdsof all whiteimmigrants to the American colonies after the 1630s came underindenture;their importance at times in particular regions was evengreater, as is suggested by Wesley Frank Craven's estimate that 75percent or more of Virginia's settlers in the seventeenth centurywereservants.26Althoughinitiallyall the servantscamefrom England, n thecourse of the colonial period migrantsfrom other countriesjoined theflow of servants to British America, and especially in the eighteenth

23 Russell R. Menard,"FromServant to Freeholder:Status MobilityandPropertyAccumula-tion inSeventeenth-CenturyMaryland,"William ndMaryQuarterlyThird eries)30 (Jan.1973),50.24 Main, TobaccoColony, p. 118.25 Clayton ColmanHall, ed., Narrativesof Early Maryland,1633-1684(New York, 1946),p.292.26 Craven, White,Red and Black:TheSeventeenth-Century irginianCharlottesville,1971),p.

5.


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10 Galensoncentury sizeable numbers of Scottish, Irish, and German immigrantsarrived n the colonies under indenture.Active markets for indenturedservants arose in Europe and in thecolonies. Hundreds of English merchants in the major British portsparticipatedn bindingemigrants or servitudeoverseas. Transportationcosts varied little across individualsor destinations,and differences inthe emigrants'productivity,whichaffectedthe rate at which they couldrepay the implicit loans, were therefore reflected in variationin thelength of the terms for which they were bound. Survivingcollections ofindenturesclearly show that characteristicsthat raised the expectedproductivityof a servant tended to shorten the term for which theservant was indentured.Thus the length of indenturevaried inverselywith age, skill, and literacy, while servantsbound for the West Indiesreceived shorter terms in compensation for their undesirabledestina-tions.27 The presence of these markets provided a consistent linkbetween European labor supply and the labor demand of colonialplanters from the 1620sthroughthe time of the AmericanRevolution.The efficiency of the institution within the colonies was further in-creased by the fact that indentures were generally transferable,andmasters could therefore freely buy and sell the remainingterms ofservantsalreadypresentin Americain responseto changesin economiccircumstances.Even in those regionswhereit became quantitativelymost important,however, indenturedservitudewas not the final solutionto the problemof colonialAmerican abor supply. For it was preciselyin those regionsthat had initially depended most heavily on white servants for theirlabor needs-the West Indies, the Chesapeake, South Carolina, andGeorgia-that planters eventuallyturned to black slaves as their princi-pal source of bound labor.The transition rom servantsto slaves, whichoccurred at different times in these regions, and at different rates,appearsexplicable in terms of the changingrelative costs of the twotypes of labor faced by colonial planters.28Indenturedservants were quantitativelymost important n the earlyhistory of those colonies that produced staple crops for export. Theprimarydemand was for workers to grow the staple, and initiallyplanters relied on white indentured labor. In addition, as outputincreased there was an increasingdemand for skilledworkers to buildhouses and farm buildings, to makethe hogsheadsand barrelsto packand ship the sugar, tobacco, or rice, to make clothingfor the plantersand their labor forces, and to perform a variety of other crafts. Overtime, in a numberof colonial regions the priceof indenturedagricultural

27 David W. Galenson, White Servitude in Colonial America: An Economic Analysis (Cam-bridge, 1981),Ch. 7.28 The followingfour paragraphs re based on the analysis in Galenson, White Servitude n

Colonial America, Chs. 8-9.


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Indentured Servitude in the Americas 11laborincreased. In mid-seventeenth-centuryBarbados and later in thecentury elsewhere in the West Indies, this was the result of sugarcultivation, as the introduction of the valuable crop both greatlyincreasedthe demandfor labor andproducedharshworking conditionsfor field laborers that made Englishmen avoid the region.29In theChesapeake colonies the cost of indentured labor rose by nearly 60percentwithin a decade when white immigration o that regionfell offduringthe 1680s, apparentlyas a result of improvingconditions in theEnglish labor market and the increasing attractivenessof Pennsylvaniafor new arrivals; he relative cost of bound white labor increasedby aneven greateramount, for the price of Africanslaves reachedthe bottomof a deep trough during the 1680s.30 n South Carolina,high mortalityrates and the rigorsof rice cultivationcombinedto reduce the flows ofnew white immigrants during the late seventeenth century, and theimportance of rice as a staple crop later had the same effect in Geor-gia.3' In each of these cases, the risingprice of Englishservants tendedto make the more elastically suppliedAfrican slaves a less expensivesource of unskilledagricultural abor than additional ndenturedwork-ers, and the majority of the bound labor force changed from white toblack.Yet the transitionfrom servants to slaves was not a completeone atthis stage, for newly arrived Africans normally did not have thetraditionalEuropeanskillsrequiredby planters n the colonies. Further-more, colonial planters typically did not train adult Africans to doskilled jobs, preferring to wait and train either slaves imported aschildren or the American-bornoffspring of African adults in skilledcrafts.32In an intermediateperiod in the growth of staple-producingcolonies of the late seventeenth and early eighteenthcenturies,a racialdivision of laborby skillthereforeappeared;unskilled aborforces were

29 RichardS. Dunn,Sugar andSlaves: TheRise of the PlanterClass in theEnglishWestIndies,1624-1713 ChapelHill, 1972),pp. 59-72, 110-16, 301-34;RichardB. Sheridan,SugarandSlavery:AnEconomicHistoryof theBritish West ndies, 1623-1775 Barbados,1974),pp. 131-33,164, 194,237-38.30 Russell Menard,"From Servantsto Slaves: The Transformation f the ChesapeakeLaborSystem," SouthernStudies, 16 (Winter1977),355-90;David W. Galenson,"The Atlantic SlaveTrade and the BarbadosMarket, 1673-1723," this JOURNAL, 42 (Sept. 1982), 491-511. For

additional vidence and discussion of slave prices, see Galenson, Traders,Planters and Slaves:TheAtlanticSlave Tradeand the English WestIndies, 1673-1725 forthcoming).31 Peter H. Wood, BlackMajority:Negroes in ColonialSouth Carolina rom 1670through heStonoRebellion(New York, 1975), pp. 62-69.32 Thus JohnOldmixonnoted in 1708that slaves "that arebornin Barbadoesare much moreusefulMen, than those thatare brought romGuinea"; TheBritishEmpire n America(London,1708), Vol. 2, pp. 121-22. On the relationbetween place of birth and training,see Russell R.Menard, "The MarylandSlave Population, 1658 to 1730," Williamand MaryQuarterly ThirdSeries), 32 (Jan. 1975), 36-37; Gerald W. Mullin, Flight and Rebellion: Slave Resistance inEighteenth-CenturyVirginia London, 1972), pp. 39, 47; John DonaldDuncan, "Servitude andSlavery nColonialSouthCarolina,1670-1776" Ph.D.dissertation,EmoryUniversity,1971),pp.

436-37.


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12 Galensonincreasinglymade up of black slaves, while white servantscontinuedtoperform skilled crafts and services, and in many cases to act asplantationmanagersand supervisors of the slaves.But this was not the final phase of development. As agriculturalproductioncontinuedto grow, the demand or both skilledand unskilledlabor increased further. The price of skilled white servants tended torise sharply. The result was investment in the trainingof slaves to takeover the skilled obs of the plantation.Although he dates at whichlaborsupply conditions and the level of demand or skilled laborcombinedtoproducethis result differedacross colonies, the tendency was present inall the British staple economies, as the relative price of skilled whiteservants apparently rose significantly over the course of the lateseventeenth and eighteenth centuries. The differences in timing acrosscolonies meant thatthe substitutionof slaves for servants had not beencompleted throughout British America by the time of the Revolution,but the advance of the process described here was sufficient o make itsresult clearly visible in all the staple-producing olonies by the end ofthe mainland'scolonial period, as in many colonies significantnumbersof plantations were based almost exclusively on black labor, withconsiderable numbers of skilled slaves as well as unskilledslave fieldhands.The large-scale use of slaves as field laborers in those regions ofBritish America that were characterized by plantation agriculturetherefore did not bring a complete end to the immigrationof whiteservants, but it did produce shifts in their composition by skill, andeventuallyin their principalregions of destination. By the time of theAmericanRevolution, the British West Indiancolonies had ceased toimport white servants on a significantscale, and on the mainlandonlythe colonies of the Chesapeake region and Pennsylvania continuedtoreceive sizeable flows of indentured abor.33In considering the career of indentured servitude in the Britishcolonies, one characteristic hatemerges is the flexibilityof the institu-tion. A single basic form of contract and method of enforcementproveduseful in the colonies continuously between 1620 and the AmericanRevolutionin spite of majorchangesin the Europeanplaces of originofindenturedabor, its colonial destinations,andits principal unctionsin

33 For quantitativeoutlines of the servants' destinationsover time, see Smith, Colonists inBondage, pp. 307-37, and Galenson, WhiteServitude n ColonialAmerica, Ch. 6.During the eighteenth century a modificationof indenturedservitudeappeared, particularlyamong German mmigrants o Pennsylvania. Under the redemptioner ystem, a migrantwouldboarda ship in Europeundera promise o pay for his passageafterarrivingn America.If he wereunableto pay withintwo weeks afterarrival,he would be indentured or a term sufficient o raisethe fare. Thisarrangements treatedhereas a variantof indentured ervitude, or thebasic formofthe contract was similar, and there was no legal differencebetween indenturedservants andredemptioners nce the latterhad beenbound. For furtherdiscussionandreferences,see Ibid., pp.13-15.


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Indentured Servitude in the Americas 13the American labor market.Thus, from its beginnings as a supplier ofunskilled abor to the southern mainlandcolonies and the islands of theWest Indies, the indenture system ultimately evolved into a source ofskilled labor to the Chesapeake region and the Middle Colonies of themainland. The ability to satisfy the changingdemands of the coloniallabormarketat criticalperiods helped makeindentured ervitudeone ofthe central institutions of colonial American society.The Revolution did not put an end to the importationof indenturedservants. The war did disrupt the operation of the indenturesystem bytemporarilycurtailing mmigration,but the servant trade revived in theearly 1780s.34An apparenttendency for the postwar indenturesystemto rely even more heavily on German and Irish relative to Englishimmigrants han before the war might have been due in part to Englishlegislation of the 1780s and 1790s aimed at preventing he emigrationofartisansand of workersbound to servitude for debt. Legislation passedby individual American states in the aftermath of the Revolutionaffectedthe legal basis of servitude in only minor ways, and the systempersisted in use, althoughapparentlyon only a limited scale, into thenineteenth century.35

THE DECLINE-AND REVIVAL-OF INDENTURED SERVITUDEIN THE AMERICAS IN THE NINETEENTH CENTURY

The history of the finaldisappearanceof indenturedservitude in theUnited States remains ratherobscure. Althoughisolated cases of theindentured ervitudeof immigrants an be foundas late as the 1830s,thesystem appears to have become quantitatively nsignificantn mainlandNorth America much earlier, perhaps by the end of the eighteenthcentury. It remains unclear whether indentured servitude dwindled inimportancein the last quarterof the eighteenth century and the firstquarterof the nineteenthprimarilybecause of a generaldecline in therate of immigration o the United States, or whether in the periodtheshareof total immigrationmadeup of servantsdeclined.Nor does thereappear to be a consensus on the role of legal changes in reducingtheattractiveness of indenturedservants to employers, as historianshavevariously cited English passenger acts and the legislation of Ameri-can states abolishing imprisonment for debt as the system's "deathblow.''36 It is known that by the time large-scale Atlantic migration

34 CheesmanA. Herrick,WhiteServitude n Pennsylvania Philadelphia,1926),p. 254.35 WilliamMiller,"TheEffectsof the AmericanRevolutionon Indentured ervitude,"Pennsyl-vaniaHistory,7 (July 1940), 131-41.36 For a survey of these views, and a discussion of the timingand causes of the decline ofindentured ervitude or Europeansmigrating o the UnitedStates-and its subsequent ailuretorevive-see CharlotteErickson,"WhyDidContractLabourNot Work n the 19thCenturyUSA?"(unpublished aper,LondonSchool of Economics, 1982).It might be noted thatrecentresearch

hasraisedthepossibility hat the volume of immigrationo the UnitedStatesin the lateeighteenth


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14 Galensonrevived, after 1820,indenturedservitudewas little used by Europeans,and the greatnineteenth-centuryransatlanticmigration romEurope tothe United States was composed of free workersand theirfamilies.The use of indenturesto facilitatemigration o the Americas had notended, however. At the same time the indenture system was finallydisappearingfrom the United States, the abolition of slavery in theBritish West Indies in the 1830s produced a renewed demand forindentured abor. Plantationowners there, primarilyengagedin sugarproduction,wereunhappywiththe largereductionof blacklaborsupplythat followed emancipation, as a large increase in wage rates wasaccompaniedby greaterirregularity n the blacks' hours of work and aperceiveddecline in the intensity of theirlabor.Theplanters obbiedtheBritish government for a number of measures designed to promoteimmigration o their colonies in order to lower labor costs and allowthemto recapturetheirpositions in international ugarmarkets;one ofthese measures was the right to indenturetheir importedworkers topreventthem from deserting theirestates. After resistingthis proposalfor fear of creating the appearanceof a new slave trade, the ColonialOfficeyielded, and finally agreed to permit the use of indenturesunderwhich immigrantswere importedto work for specific employers forfixed terms.37This nineteenth-centuryrevival of the use of indentured aborin theBritish West Indian sugar colonies, and in parts of South America,constituteda historicalepisode quite differentfrom the earlier use ofboundworkersin the Britishcolonies of the seventeenthandeighteenthcenturies. Whereas the indenture system had earlier involved theimmigrationof Europeans to America, in the nineteenthcenturyit wasAsia that furnishedAmericanplanters with a supply of bound labor.IndenturedIndiansbegan to arrive in British Guiana in 1838,and thatcolony was soon joined as an importer by Trinidad and Jamaica.Shipmentsof indenturedChinese began to arrivein Cubain 1847,andwithin a decade British Guiana,Trinidad,and Peru had also receivedcargoes of boundChinese workers.38andearlynineteenth enturieswas substantially reater hanhasgenerallybeenbelieved;HenryA.Gemery,"EuropeanEmigration o the New World, 1700-1820:Numbersand Quasi-Numbers"(unpublished aper, ColbyCollege, 1983).Boththe overallmagnitude f immigration nd the roleof indentured ervitudeduring his period remain o be established irmly.

3 K. 0. Laurence, "The Evolution of Long-TermLabourContracts n Trinidadand BritishGuiana,1834-1863,"JamaicanHistoricalReview, 5 (May 1965),9-27.38 On the Indian indenturedmigration, see Alan H. Adamson, Sugar WithoutSlaves: ThePoliticalEconomy of BritishGuiana, 1838-1904(New Haven, 1972);DonaldWood, TrinidadnTransition:The YearsAfterSlavery(London, 1968);Hugh Tinker,A New Systemof Slavery:TheExportof Indian LabourOverseas, 1830-1920(London, 1974).On Chineseindenturedmigrationsee DuvonCloughCorbitt,A Studyof theChinese n Cuba,1847-1947 Wilmore,Kentucky, 1971);Watt Stewart, ChineseBondage in Peru: A History of the Chinese Coolie in Peru, 1849-1874(Durham,North Carolina, 1951); Persia Crawford Campbell, Chinese Coolie Emigration to

CountriesWithin he BritishEmpire London, 1923).In addition o these movements, during he


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Indentured Servitude in the Americas 15The form of the contracts typically used in this nineteenth-centurymigrationdifferedsomewhat from that used in the earlierperiod; forexample, wages were generally paid to the Asian servants, and theircontracts often provided for their return passage to their country oforigin upon completion of the term. Yet the immigrants normallyworkedfor fixed terms of years, withoutthe power to change employ-ers, under legal obligation of specific performanceof their contractswith penalties including mprisonment,and they were therefore boundunder genuine contracts of servitude rather than simply service con-tracts of debt that could be terminated by repayment of a statedprincipalsum.39In the second half of the nineteenthcenturyanothersignificant lowof migrants from Asia to the Americas occurred. Bound Chineselaborers were imported to work on the sugar plantations of Hawaiibeginning n 1852,and they werejoined thereby a migrationof Japaneseworkers that began in 1885.From 1852, Chinese workersalso began tocome to California o workas minersand to buildthe westernrailroads.The Asian migrants to Hawaii worked under true indentures, whichbound them to work for specified planters for fixed periods of years,

withlegalprovisionforcompulsionof specificperformanceor imprison-ment.40Those bound for California mmigratedunder debt contracts,agreeing to repay the passage fare advanced to them out of theirearnings n America; n principle hey were free to changeemployers,orto repay theiroutstandingdebt and become free.4'The question of why indentured servitude was revived for thefacilitationof large-scalemigration o the West Indies at the same timethat it had finally disappeared from use for migration to the UnitedStates is of considerablehistorical significance; the arrival of Asiansboundto servitude nthe Caribbeanhadverydifferentmplications romthe arrival of Europeans free to choose their jobs and places ofresidence in the nineteenth-centuryUnited States. These divergentoutcomesresultedfromthe operationof powerfulunderlyingeconomicnineteenthcentury relatively small migrationsof indenturedworkers occurredfrom AfricaandMadeira o the West Indies and SouthAmerica. For an overviewof these bound migrations, eeStanley L. Engerman,"ContractLabor, Sugar,and Technology n the NineteenthCentury," hisJOURNAL, 43 (Sept. 1983), 635-59; also G. W. Roberts and J. Byrne, "SummaryStatisticsonIndenture nd Associated Migration ffecting he West Indies, 1834-1918,"PopulationStudies,20(July 1966), 125-34.

39 For example, see Tinker,A New System of Slavery,Ch. 6. It mightbe notedthatthe Asianmigrantso the West Indiesoftenappear o have chosen not to return o theirnativecountriesafterbecoming ree.4 KatharineComan, TheHistoryof ContractLabor n theHawaiian slands, Publications f theAmericanEconomicAssociation,Thirdseries, 4 (Aug. 1903),7-10; ClarenceGlick, "TheChineseMigrant n Hawaii: A Study in Accommodation" unpublishedPh.D. dissertation,UniversityofChicago,1938),pp. 38-39.41 Kil Young Zo, ChineseEmigration nto the United States, 1850-1880 New York, 1978),pp.95-96.


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16 Galensonforces, and a consideration of the economic basis of indenturedratherthan free migration can serve to suggest the source of the basicdifference in the character of these two major nineteenth-centurymigrations o the Americas.42Large-scale net migrationmay be warrantedby economic conditionswherever sizeable differences in average labor productivityexist be-tween two regions. An additionalnecessary conditionfor migration ooccur in such situations is the absence of politicalbarriers o migration.When a large-scale migrationdoes occur, it will consist of free workersif the migrants can afford to pay the costs of migration out of theirsavings, or if existing sources of capital permit them to borrow thesefunds at a reasonable cost. As was seen in the discussion earlier in thispaper, the migrationwill tend to be made up of bound workers if themigrants cannot readily pay the costs of migrationout of their ownwealth, or borrow the required funds; under these circumstances, theuse of indenturescan provide a new sourceof capital,as the intermedia-tion of merchants can effectively allow migrants o borrow the cost oftheirpassage from those who demandtheir services in theircountryofdestination, in the form of advances against their future labor. Onceagain, it should be noted that existing political conditions in bothsending and receiving areas must permit servitude in order for boundmigration o occur.This analysis suggests that a possible explanationfor the contrastdescribed above-a free European migration to the United Statesoccurring coincidentally with a bound Asian migrationto the WestIndies, South America, Hawaii, and California-might lie in a differen-tial ability of the two groups of migrantsto bear the cost of migration.Precise empirical tests of this hypothesis are elusive because of thedifficultiesnvolvedin measuringboth the fullcosts of migrationandthewealth of migrants. Examination of related evidence, however, canserveto indicate whetherthe explanation s plausible.Specifically,whatcan be done is to comparea major componentof the cost of migration,the cost of passage, to a potential index of the wealth of migrants,theper capita income of their country of origin.Both of these variablesareless than perfect proxies for the desired variables. Passage costs ofcourse constituted only a share of the full cost of migration, and this

42 The magnitudes of these population movements were very different. Thus it has beenestimated hat 45.2 million ree Europeansmigrated o the Americasduring1846-1920,comparedto a total of 775,000 bound Indians and Chinese who migrated o the West Indies and SouthAmerica n the nineteenthcentury,and another100,000boundChineseandJapanesewho migratedto Hawaii;Stanley L. Engerman,"Servants o Slaves to Servants:ContractLaborand EuropeanExpansion," in H. van den Boogart and P. C. Emmer, eds., Colonialismand Migration:Indentured Labour Before and After Slavery (The Hague, forthcoming), Table 11. Yet in spite of theimbalancebetween these relativemagnitudes,due to the enormityof the free Europeanmigration,the migration f boundAsianswas clearlya significant ne for the Americas.For some interestingrecent comments on these nineteenth-centurymigrations,see William H. McNeill, The GreatFrontier: Freedom and Hierarchy in Modern Times (Princeton, 1983), pp. 39-55.


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Indentured Servitude in the Americas 17share could vary from case to case. Nor can the relation of wealth toincome be determined with precision in most instances. Yet thesevariables should generally have been correlatedwith the true variablesof interest here. Therefore if the analysis outlined above is valid, itwould imply that the ratio of passage fare to per capitaincome shouldhave been substantiallyhigher for the bound Asian immigrantshan forthe free Europeans.43Althoughthe test does have significant hortcom-ings, it can suggest whether the explanationsuggestedhere is sufficient-ly plausible to be worth pursuingwith measurementsof greater preci-sion.Table 1presents evidence on annualper capita incomein a numberofcountries from which significantemigrationsoccurredin the nineteenthcentury, togetherwith passagefares to some of the emigrants'principalcountries of destination.Althoughthe precisionof boththe estimates ofincome and the quotations of fares should not be exaggerated,most ofthe figures shown are drawn from careful studies, and should serve asreliableindicators of the relative magnitudes nvolved.The most striking feature of the table is the contrast between theratiosof fares to per capita income for EuropeanandAsian countriesoforigin. During the nineteenth century, the evidence suggests that thecost of passage to Americawas consistently equivalentto less thanonehalf the level of per capita income in Great Britain, Scandinavia, andGermany, whereas potential Chinese and Japanese emigrants facedfaresto the Americas of an amountconsistently greater hanthree timesthe level of per capita income in their own countries. The absence ofindenturedservitude from the great nineteenth-centurymigration romEurope to the United States therefore appears understandable, or thecost of migrationwas apparentlysufficiently ow relative to the wealthof the migrants to render credit transactions unnecessary." The con-

43 The test proposedhere mightbe seen as an implicationof a special case drawn roma moregeneral analysis. In general, a migrantmight choose between financingmigrationcosts out ofsavingsorby borrowing y comparinghe levels of his incomebeforeandafterthemove;if incomeaftermoving s expected to be considerablyhigher han before, the migrantmightprefer o repaymoving costs out of the higher post-migration ncome, in order to smooth the path of hisconsumption ver time. Therefore, f the question s simplyone of whether he migrantwillborrowin order o migrate, he answer woulddependon a comparison f income evels in the countriesoforigin and destination.Yet although ndentured ervitudewas a form of credit, it involved morethanmanycredittransactions.For an indenturedmigrantnot only agreed o repayhis loan, but togive up much of his freedom during he period of repayment; hus servants typicallygave up thefreedom to marryduringtheir terms, to engage in business on their own account, to determinewhere they would live, and so on. The assumption is therefore made here that given theseconditions,migrantswould stronglyprefernot to borrow o migrateby indenturinghemselves,butwould insteadprefer o save prior o migration n orderto migrateas free workers.The test of thedifficultyof doing this therefore nvolves a comparisonof the wealthof migrantsand the costs ofmigration;he variablesexamined nthe text are intended o be consideredas proxies ortheselessreadilymeasurablevariables." An interesting eatureof the fares shown in Table 1is the significantdeclinein passagecostsfromGreatBritain o the United Statesduring he early nineteenthcentury. Although he greater


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18 Galenson

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Indentured Servitude in the Americas 21trasting ubiquity of indentured servitude in the Asian trans-Pacificmigrations of the nineteenth century appears equally understandable,for the high passage fares facingemigrants rom countrieswithvery lowlevels of per capita income musthave meant that few could afford o paythe cost of migrationout of their savings.The evidence of Table 1 nonetheless appears to raise several ques-tions, as the result of apparent inconsistencies within these broadconclusions. One concerns the British migration to America in thecolonial period: Why was a majorityof the migrationmade up of boundworkers when the ratio of passage fare to per capita income shown forthe late seventeenth century, of about one half, is not far above many ofthe ratios found for the free European migrations of the nineteenthcentury? Part of the explanationmay lie in the demographiccomposi-tion of the migrations. In the American colonial period, indenturedservitude was strongly, although not exclusively, associated with themigrationof unrelated ndividuals, most of whomwere in their late teenages and early twenties.45 The European migrationof the nineteenthcentury might have been made up to a greaterextent of migrantsinfamilies than had generally been the case earlier.46The differencemighthave been important, or mostmigrating amilies begantheirvoyages byliquidatingthe assets-most often land, homes, farm equipment, andlivestock-they had accumulatedover the courseof theworking ives ofthe parents.These family groupsmightas a resulthave had morecapitalon hand to pay for their voyages than the younger, single migrantswhoindentured hemselves to gain passage to colonial America. Few of thelatter would have had time to accumulate significant savings in theirregularity f the schedules of steamshipsapparentlydidreducethe variability f fares due to suchfactorsas seasonalityand the decisions of individual hippingagents-and thegreaterspeedof thesteamships reduced the full cost of passage by the opportunitycost of the saved time ofpassengers-the majordecline in faresappears o have been completeby about1830,well beforesteamshipsreplacedsailingvessels in the Atlanticpassenger rade n the 1860s.FordiscussionseeJ. D. Gould,"European nterContinental migration 815-1914:PatternsandCauses," JournalofEuropeanEconomicHistory, 8 (Winter1979), 611-14;also see Douglass C. North, "Sources ofProductivityChangein Ocean Shipping, 1600-1850," Journalof Political Economy, 76 (Sept.1968), 953-70.

45 For example, see Galenson,WhiteServitude n ColonialAmerica, Ch. 2.46 For example, see Kristian Hvidt, Flight to America: The Social Background of 300,000 Danish

Emigrants New York, 1975),pp. 91-102;CharlotteErickson,"Emigrationrom the BritishIslesto the U.S.A. in 1831," PopulationStudies, 35 (July 1981), 175-97; and Robert P. Swierenga,"International aborMigration n the NineteenthCentury:TheDutchExample,"paperpresentedto Economic History Workshop,Universityof Chicago, May, 1979. During he colonial period,virtuallyall English ndentured ervantswere unmarriedindeed,standard ervantcontracts n theeighteenthcentury included a declaration that the individual bound was single, as shown inGalenson, White Servitude in Colonial America, pp. 201-02). The same was not true for Germanredemptioners,who often came in families;quantitativenformation n theirdistribution y familystatus s poor, but theproportionsn familiesgenerallyappear o have been low. For adiscussionofthe evidence see MarianneWokeck, "The Flow andthe Compositionof German mmigrationoPhiladelphia, 1727-1775," Pennsylvania Magazine of History and Biography, 105 (July 1981), 249-78.


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22 Galensonshort working careers. Their families might in some cases have giventhem the capital necessary to pay their passage to America,but manymay have found it difficult to raise the sums necessary withoutthreateningthe survival of their family farms or businesses. Demo-graphicdifferences might therefore account in part for the apparentgreater availability of capital among the migrants of the nineteenthcentury.47This hypothesismust be consideredspeculative,for informa-tion on the composition of both the colonialand the nineteenth-centurymigrationsby family status of the migrants s incomplete. And even ifpresent in some degree, these differencesare unlikely to account fullyfor the nineteenth-centurydecline of indenturesamongEuropeans, formany families had been indenturedas redemptioners n the eighteenthcentury, and many young individualswithout familieswere includedinthe transatlanticmigrationof the nineteenth century.A more general factor might be of much greater importance inexplaining his puzzle, for a likely solutionlies in a significantdiscrepan-cy between the theoretical analysis suggestedearlier and its implemen-tation in Table 1. The analysis implied that the importantvariabledeterminingmigrants'ability to pay the costs of their migrationwastheir wealth; Table 1then presentedevidence on per capita income as aproxy for wealth. National income and wealth are stronglyand positive-ly relatedover time, but duringperiodsof transition rom preindustrialto industrialeconomic conditions their relationshipdoes not generallyremain constant. Rather there is a long-runtendency for the share ofsavings in gross national productto rise, producinga tendency for theratio of wealth to income to increase over time.48The significanceofthis for the empirical est consideredheremightbe considerable n viewof the substantial differences in per capita income and the level ofindustrialization mongthe economies examined,for potentialmigrantsfrom countries in which many people are not far above what areconsidered to be subsistencelevels mighthave relativelylittle abilitytoaccumulate wealth in comparisonwith migrantsfrom wealthiercoun-tries. Thus nineteenth-centuryEnglishmenmight have foundit consid-erably easier on average to save an amount equivalentto one-half ofannualper capitaincome than their poorercounterparts n England200

4 FarleyGrubbhas found that amongGerman mmigrants rriving n Philadelphia uring1785-1804,51 percentof singlemales and59 percentof single femaleswere indentured, omparedwithonly 35 percentof marriedadults and40 percentof children ravelingwith parents;"IndenturedLabor n Eighteenth-Centuryennsylvania" dissertationn progress,Universityof Chicago).Thisresult is consisent with the hypothesisthat an increasein the importanceof families in migrationwould have tended to reducethe amountof servitude.48 Simon Kuznets, Modern Economic Growth: Rate, Structure, and Spread (New Haven, 1966),pp. 235-40. On the risingratio of wealthto per capitaoutput n GreatBritain n the secondhalf ofthe eighteenthcentury, see C. H. Feinstein, "Capital Formation n Great Britain," in PeterMathias and M. M. Postan, eds., The Cambridge Economic History of Europe, Vol. VII, Part 1

(Cambridge, 978),pp. 90-92.


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Indentured Servitude in the Americas 23years earlier, and this could well explain why the importance ofindenturedservitude among English and perhapsother Europeanmi-grantsto America declined so substantially n the long run.A second question concerns the nineteenth-centuryChinese migra-tion to California. The quantitative evidence of Table 1 shows noobvious economic difference between this and the other Asian migra-tions to the Americas. Yet as discussed earlier, unlike the other Asianemigrants, the Chinese destined for California were not indentured.Why did similareconomic conditions not lead to similar conditions ofmigration? A likely answer to this question appears to be that theconditions were in fact similar,and that a differencemoreapparent hanreal might have existed for political reasons. In practice it is not clearthat the Chinesewho migratedto Californiaunderdebt contracts wereactually able to take advantage of the fact that their contracts, unlikeindentures,allowed themto repaytheirdebts andbecome free workersbefore the end of the contracts' normalterms, nor is it clear that theywere in fact free to choose theiremployers in America, and to changeemployers at will. Much remainsunknownabout the actualoperationofthe system underwhich Chinese, and laterJapanese, migrantsworkedin the western United States, but many contemporariesbelieved theseworkers were effectively indentured, n being tied to specificemployersfor fixed terms. The question of why legal contracts of indenturewerenot used in these circumstances is an intriguingone; indentures forimmigrantswere not illegal in the United States when the Chinesemigration o California irst beganin the 1850s,and indenturesremainedlegal within some limits until 1885.49Yet the contemporarydiscussionof the Chinese migrationappears to carry an implicitassumptionthatthe use of indentured abor-or "servile" labor in the languageof theday-was not acceptable in the United States on a largescale.50Morework on both the attitudes surrounding his episode and the Asians'conditions of work might prove rewarding, or it appearsthat even at atime when the U.S. government was encouragingthe importationofindentured workers from Europe, Americans were not willing totolerate the large-scaleimportationof indenturedAsians. Thus in 1864

49Charlotte Erickson, American Industry and the European Immigrant, 1860-1885 (Cambridge,Massachusetts,1957).The Act to Encourage mmigration f 1864made it legal for immigrantsopledge theirwages for a period of up to one year to repaycosts of theirmigrationhathad beenadvanced o them.Thatindentureswere not openly used for Chinesemighthavebeen due to thefact that in practicethey were held for termssubstantiallyongerthanone year, butevidenceontheiractualtermsis elusive.50Forexample, see thedefenseof the systemby GeorgeF. Seward,Chinese mmigration,nItsSocial and Economical Aspects (New York, 1881), pp. 136-58. For a brief but interestingdiscussionof the actualcontractual greementsof the Chinese mmigrantsnCalifornia, ee ElmerClarence Sandmeyer, The Anti-Chinese Movement in California (Urbana, 1973), Ch. 2. I plan topresent a further nvestigationof these arrangements, nd of theirdeviation n practicefromthedescriptionsgiven at the time by the "Chinese Six Companies"largely responsiblefor theimportation f the Chinese, in a forthcomingpapercoauthoredby PatriciaCloud.


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24 GalensonCongresspassed the Act to EncourageImmigration,whichattempted orevive the indenturesystem by providing or immigrantabor contractsto be registered with the U.S. Commissioner of Immigration,and forunfulfilledcontracts to serve as a lien upon property acquired by theimmigrant n the future. Yet this act was aimed at encouragingtheimmigrationof skilled Europeans, and does not seem to have beenintended in any way to promote the immigrationof unskilled Asians.51

CONCLUSION: THE ECONOMICS AND POLITICSOF INDENTURED SERVITUDE IN THE AMERICAS

Indenturedservitude, as developed by the VirginiaCompanywithinlittle morethan a decade after the first settlement at Jamestown, was aninstitutionalresponse to a capital market imperfection. Designed forthose without access to other suppliers of capital, the device of theindentureenabled prospective migrantsto America to borrow againsttheirfutureearnings n Americain order to pay the highcost of passageacross the Atlantic. After a series of unsuccessful early experiments,the VirginiaCompany solved a severe problem of enforcing the repay-ment of the initial capital outlay by selling the servant's contractoutright to a colonial planter for a lump sum, thereby making themigrant'smaster at his destination also the source of his loan. The salesolved the agency problem that had existed when the Companyhadrentedout servants for whom it had paid passage costs, for the colonialplanter had then had insufficient incentive to protect the Company'sinvestmentin the worker.The particular ormof the solution devised by the VirginiaCompanyto this problemof increasing ong-distance abor mobilitywas of coursenot the only one possible. Other solutions to the problem of enforcinglong-term abor contracts in orderto facilitatemigrationhave appeared,and some of these have been used successfully in significanthistoricalepisodes.52Yet the form originally used in early Virginia,in which an

51 Erickson, American Industry and the European Immigrant, Ch. 1. On the politics of contractlabor nthe latenineteenth-centuryUnitedStates,and the oppositionof unions, see Ibid.,Chs. 8-10.52 Theexperience of the Chinesein Californiamightofferanexampleof a significant dditionalmeans of enforcement.GuntherBarthwrote of the enforcementof theirdebtcontracts hat "thekinshipsystem suppliedan extra-legalcontrol in a country where courts and customs failed tosupportany formof contractlabor," as the families the migrantshad left behindthem in Chinaremained"as hostages within the reach of their creditors;"GuntherBarth, BitterStrength:AHistory of the Chinese in the United States, 1850-1870 (Cambridge, Massachusetts, 1964), pp. 56,86. Yet it mightbe notedthat even in this case the ownershipof the debtcontractby the worker'simmediateemployerapparently emained ypical;Ibid., pp. 55-56. The padronesystem used inItaly andGreece inthe latenineteenthcenturywas based on securing heloan of passagemoneytothe migranthroughmortgageson landheld by relativeswho remainedbehind;PhilipTaylor,TheDistant Magnet: European Emigration to the U.S.A. (New York. 1971), p. 98. It might be noted

here that the AmericanEmigrantCompanyand the other companies that recruited aborers or


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Indentured Servitude in the Americas 25employer obtained the services of an immigrant or a specified period-usually a numberof years-upon paymentof a lump sum to the importerproved by far the most importantquantitatively.Once introduced n thesecond decade of the seventeenth century, the indenturesystem in thissame basic form remainedin almost uninterrupteduse on a significantscale in the Americas for nearly 300 years.Entry into an indenturenearly always must have involved a substan-tial sacrifice of personal freedom for the migrant.Neither an English-manbound to serve in colonial Americanor a nineteenth-centuryndianbound to labor in the West Indies would have much control over theirconditions of work duringthe years in which their loan was repaid,andtheirability to make decisions about most aspects of theirlives in thattime was severely circumscribedby the control of theirmasters. As aresult, even many migrantsaccustomed to societies in which the rightsof workers were less than those of their employers might have beenreluctant to enter into long-term indentures. Yet the consequences ofproduction hat brought nto use the naturalresources of the Americas,with the resulting promise of economic opportunity for workers,provided a powerful attraction to prospective settlers drawn from thepopulationsof EuropeandAsia. The attractionwas sufficient o promptmany migrantsover the course of three centuries to enter indentures,giving up muchof theirfreedom for a periodof years "in hope therebyto amend theyr estates."53But not all migrantsto America duringthe colonial period and thenineteenth century entered indentures. The analysis presented in thispaper suggested that flows of migrantswould be composed of boundworkers only when the migrants were unable to bear the costs ofmigrationout of their accumulated wealth. Examination of empiricalevidence supported the plausibility of this analysis, for the evidencesuggested that indentured servitude assumed an importantrole in amigrationwhen the direct cost of passage was high relative to the percapita income of the migrants' country of origin. Thus that the greatnineteenth-centurymigrationof Europeans to the Americas was com-posed of free individualsand families appearsto have been a conse-quence of both falling transportation osts and rising European ncomelevels.northernmanufacturers uring he mid-1860s n effect operatedon a basis similar o the Englishmerchantswho sent servants to colonial America, for these companies relied on Americanemployers o provide he workingcapital o pay for transportationf workers,as wellas to securerepayment rom the wages of the contract laborers;Erickson,"Why Did ContractLabourNotWork n 19thCenturyUSA?," p. 19.

5 The quotationis from the prophetic formulationof the indenturesystem of Sir GeorgePeckham in 1583 in his A True Reporte, of the late discoveries, and possessions, taken in the rightof the Crowne of Englande, of the Newfound Landes, By that valiaunt and worthy Gentleman, SirHumfrey Gilbert Knight, Ch. 7.


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26 GalensonThe terminationof the use of indentured labor in the Americasoccurred as the result of political action. The use of indenturedAsiansin the West Indies, which originatedwith the abolitionof slavery in the1830s and continued into the twentiethcentury, hadlong been a sourceof concern to the governments of the sending countries, as well as theobject of attacks by the same organized groups that had led thecampaign to abolish slavery. A series of political actions, growing inintensity from the late nineteenth century, finally led to a decision bythe British government in 1917 to prohibit further transportationofIndiansfor purposesof servitude for debt.This legal abolitionof the indenturedemigrationof Indiansbrought o

an end a cycle in the use of bound labor in BritishAmerica that hadbegun when indenturedworkerswere used to provide an initial solutionto the problem of labor shortagein the New World,then had seen therise of slavery lead to an abandonmentof servitude,and still later hadseen the abolitionof slavery producea revival of servitude. In some ofthe phases of this cycle, economic forces determinedoutcomes withrelatively little constraint from political considerations; such was thecase, for example, in the original nnovationof indentured ervitude,inthe substitutionof slaves for servants in the sugarislands of the WestIndies and the southerncolonies of the British mainlandn the course ofthe seventeenth century, and in the nineteenth-centuryrevival ofservitude n the West Indies. In another set of cases, politicalconsider-ations appearto have dominatedeconomic concerns; apparentexam-ples include the decision of the British government o abolish slaveryinits possessions during he 1830s,the terminationof indentured ervitudein Hawaii, imposed upon annexation to the United States, and theBritish government's later decision to abolish servitude for Indians.And in yet a thirdcategoryof cases, a blendof significanteconomicandpolitical forces appears to have producedoutcomes that are less fullyunderstood, and indeed in some instances have not even been fullydescribed.Cases in point may include a numberof episodes involvingcontract aborin the United States, such as the dwindlingof importanceof indentured servitude in the early national period, and the failureexplicitly to use the common form of indentured servitude for theChinese immigrants o California n the second half of the nineteenthcentury. Furtherstudy of this last groupof phenomenamight help toilluminatethe ways in which economic and ideologicalforces contendwhen neither type clearly dominates, and thus might add to ourunderstanding f how outcomes aredeterminedwhen politicalattitudesand economic motivations collide.

david galenson

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