Labor productivity and transportation costs in Africa and the Americas during the transatlantic slave trade: An empirical verification of Stefano Fenoaltea's model

This dissertation examines three economic models for the cause of the transatlantic slave trade: a differential in labor productivity between Africa and the Americas, market failure in Africa, or high transportation costs within and from Africa. First considering the labor productivity model: if labor productivity in Africa was low, then a positive labor productivity differential between Africa and the Americas could have driven the forced migration of Africans to the Americas, but when data on the intercontinental labor productivity differential is compared to the high transportation and mortality costs of the slave trade, it is clear that the labor productivity differential between Africa and the Americas was inadequate to cover the costs of the trade—these were far greater than the increase in world output which the trade engendered. The second model blames market failure for low slave prices and high food prices on the African coast. Because captives were acquired at costs far lower than the costs of raising a newborn to a productive age, the market failure model argues that market prices failed to equate the private and social costs of slave exports, but this approach misinterprets the reason for relatively high food prices in Africa. Because the available African food price data comes exclusively from European records of coastal food purchases that were used to provision ocean-going slavers, the food prices include very high loading costs and are hence biased upward relative to the price of slaves for whom loading costs were relatively low. The market failure model is further discredited when a counterfactual trade in African commodities is analyzed. African surplus output, net of transportation costs, would have been far lower if commodities such as millet were exported instead of the actual trade in slaves. The transportation cost model successfully explains why slave prices in Africa were low in nominal terms and explains why slaves were exported—as a means of paying for costly imports when the transport of alternative African exports was prohibitively expensive.