Efficient Slave Markets

Charles Calomiris and Jonathan Pritchett have an interesting little paper looking at the price of slaves on the eve of the Civil War, showing that prices tumbled in 1861 as it became clear to Southerners that Abe Lincoln wasn’t kidding about his willingness to go to war to save the union:

Abraham Lincoln’s election produced Southern secession, Civil War, and abolition. Using a new database of slave sales from New Orleans, we examine the connections between political news and the prices of slaves for 1856-1861. We find that slave prices declined by roughly a third from their 1860 peak, reflecting increased southern pessimism regarding the possibility of war and the war’s possible outcome. The South’s decision to secede reflected the beliefs that the North would not invade to oppose secession, and that emancipation of slaves without compensation was unlikely, both of which were subsequently dashed by Lincoln’s actions.

It’s not exactly a shocking discovery, but it is a neat finding and a neat example of how economists can help inform historical work. This kind of quantitative measure of Southern expectations about Lincoln and the war is a useful supplement to qualitative measures taken from politicians’ speeches and letters, newspaper editorials, etc.