20080908 Econ 113 Lecture: Colonists and Pre-Civil War Expansion

During the pre-industrial early-modern period, 1400-1700, high Eurasian civilizations projected power across oceans in six ways...

• Prestige voyages
• Seaborne Trade-Piracy Empires
• Conquest and Occupation: encomienda/hacienda/mining
• Slave Raiding:
• Plantation Agriculture: use slaves to grow plantation crops: coffee, sugar, tobacco
• Small-Farmer Settlement:
  • Religious motive
  • Company profit motive (except for the Hudson's Bay Company, didn't work)
  • Get-a-farm motive

The sixth--small farm settlement--was, to contemporaries, the least attractive--it was what you did when you couldn't do anything else. The sixth was also, in the long run, the most important...

The pre-industrial world was poor:

But America was relatively rich up until independence:

Smithian Growth:

The colonies that were to become the United States--at least the northern United States--as Adam Smith's Utopia:

• Literate and entrepreneurial population
• Good legal infrastructure
• Market exchange
• Abundant land (means high output per worker)
• Free land (means high wages)
  • Later on we are going to contrast this picture with Engerman and Sokoloff's picture of Latin America: populations to exploit and ways to exploit them create extreme inequality... which has poisonous consequences....

And the colonial economy prospers...

Population:

1600 1,000
1640 24,000
1680 150,000
1700 260,000
1730 650,000
1780 2,700,000

Output:

How to even claim to measure output? Nevertheless, we have heroic guesses...

Year Y/Pop in 2008$
1710 $880
1775 $1,200
1840 $1,800

Of course:

1929 $9,100
2008 $48,000

Politics:

Year Settlement/Event
1607 Jamestown
1608 Quebec
1620 Plymouth
1624 New Amsterdam
1630 Massachusetts Bay Company
1643 Swedesboro, Pennsylvania
1640-1660 English Revolution
1689 "Glorious Revolution" in England
1754-1763 French and Indian War; Mercantile System; Royal Proclamation of 1763

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Why Is Independence Important for American Economic History?:

Pre-Industrial Growth Accounting: http://www.scribd.com/doc/5447130/null

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We can see Malthusian pressure starting:

% urban: 5% 1790, 11% 1840, 20% 1860; "urban" means "2500 or more"...

But pressure relieved by the westward migration:

How did the westward migration happen?