Most of the literature on trade and labour predicts that price booms of labour-intensive exports boost employment and wages in exporting countries. By contrast, Domar (1970) and Acemoglu and Wolitzky (2011) predict that under labour scarcity, labour demand shocks that are induced by export booms can increase labour coercion.
Using the unique natural experiment of the boom in cotton prices during the American Civil War due to Lancashire cotton famine, and newly digitized samples of Egypt’s individual-level population censuses of 1848 and 1868, Professor Saleh documents that the cotton famine increased imported slaveholdings among medium and small landholders in rural Egypt between 1848 and 1868, but not among large landholders (top state officials) who instead increased their coercion of local labour via confiscation of larger rural settlements. Market employment of local wage labour declined though, as landless wage workers likely became landholders, and this effect persisted through 1917, after the abolition of slavery in 1877. Saleh explains his findings by the relative scarcity of local labour, the labour intensity of cotton, and landholders’ optimism about the future demand for Egyptian cotton.
Professor Mohamed Saleh
Mohamed Saleh is a Professor of Economics at the Toulouse School of Economics and a member of the Institute for Advanced Study in Toulouse. His research interests are in Economic History, Political Economy, and Development Economics. In particular, he has been interested in the economic history of the Middle East and North Africa, where he employs novel datasets constructed from both primary (archival) and secondary data sources, such as historical population censuses and papyrological tax records. Some of the topics he examined include the socioeconomic differences across religious groups in the Middle East and North Africa, how they were generated by taxation in the medieval period, and how they were influenced by state industrialization and public mass education during the last two centuries. In addition to various questions related to this topic, his current research agenda also focuses on labour coercion and land inequality in the region and the historical shift toward wage labour.
Professor Joan R. Rosés, Department of Economic History, LSE
Joan R. Rosés is Head of the Department of Economic History at LSE. His research interests compriss Historical Economic Geography, European economic history (19th and 20th centuries), long term economic growth and productivity, and labour markets.
A recording of the lecture is available here: Epstein Lecture 2020