A Message from a Senior Democratic Politician
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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...


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


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


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


Why Is Independence Important for American Economic History?:

Pre-Industrial Growth Accounting: http://tinyurl.com/dl20080902

We can see Malthusian pressure starting:


hand091206 - NeoOffice Writer

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

But pressure relieved by the westward migration:

hand090506 revised not distributed - NeoOffice Writer

How did the westward migration happen?

Political Independence:

  • April 1775 - August 1782 Revolutionary War
  • July 4, 1776 Declaration of Independence
  • 1777 Articles of Confederation
  • 1787 Constitutional Convention
  • 1788 Constitution Ratified
  • 1789 Washington Inaugurated
  • 1791 Bill of Rights passed



Indian Removal:

Andrew Jackson's speech to the Cherokee tribe, March 7, 1835:

You are now placed in the midst of a white population. Your peculiar customs... have been abrogated by the great political community among which you live; and you are now subject to the same laws which govern the other citizens of Georgia and Alabama.... Most of your people are uneducated, and are liable to be brought into collision at all times with their white neighbors. Your young men are acquiring habits of intoxication. With strong passions, and without those habits of restraint which our laws inculcate and render necessary, they are frequently driven to excesses which must eventually terminate in their ruin. The game has disappeared among you, and you must depend upon agriculture and the mechanic arts for support. And, yet, a large portion of your people have acquired little or no property in the soil itself, or in any article of personal property which can be useful to them. How, under these circumstances, can you live in the country you now occupy? Your condition must become worse and worse, and you will ultimately disappear, as so many tribes have done before you. . . .

I have no motive, my friends, to deceive you. I am sincerely desirous to promote your welfare. Listen to me, then, while I tell you that you cannot remain where you are now. Circumstances that cannot be controlled, and which are beyond the reach of human laws, render it impossible that you can flourish in the midst of a civilized community. You have but one remedy within your reach; and that is, to remove to the West and join your countrymen, who are already established there...


Canals and Rivers:



Riverboats at Cairo, Illinois


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railroads-1870.jpg 959�80 pixels







National Population:

1790: 3.9M people, $1100 1840 17.1M people, $1800 1860 31.4M people, $2000

City sizes: 1790: NY 33, PH 29, BO 18; 1840: NY 313, Balt 102, NO 102, PH 93; 1860 NY+Brooklyn 1081, PH 565, Balt 212.

Why this pattern? Transport: Erie Canal, C&O Canal, Mississippi-Missouri-Ohio river system. The coming of the railroad to keep NO from surpassing NY... New York Central RR, Pennsylvania RR...

SF in 1860: 15th among American cities with 57K people...

Conquest: Northwest territories, inland southeast and War of 1812, Louisiana Purchase, Florida, Texas, Mexican Cession, Oregon Territory, Alaska "Seward's Folly", Hawaii. Conquest keeps land abundant, hence keeps wages high.

Relatively fast increase in output per capita in the U.S. before 1860. A puzzle that growth was so fast. The puzzle set out for your inspection... Implication: an enormous increase in effective land and natural resources per worker from 1790 to 1860. Population grows. Accessible natural resources grow significantly faster...