The Cotton Boom and Slavery in Nineteenth-Century Rural Egypt

The “staples thesis” argues that institutions in a given region could be explained by the nature of production of its prevailing staples, whereby slavery is likely to emerge in “slave-conducive” crops, such as cotton, rice, and sugarcane. This paper evaluates the thesis using a unique natural experiment from nineteenth-century rural Egypt, the cotton boom that occurred because of the American Civil War in 1861-1865. Historical evidence suggests that the cotton boom marked the emergence of the short-lived institution of large-scale agricultural slavery in Egypt’s Nile Delta, where all slaves were imported from East Africa, before the abolition of slavery in 1877. Employing the newly digitized Egyptian individual-level population census samples from 1848 and 1868, I find that cotton-favorable districts witnessed greater increases in household’s slaveholdings and the share of slave-owning households between 1848 and 1868 than less favorable districts. Those districts also witnessed greater increase in the population share of free local immigrants. I examine several potential mechanisms of these effects, namely, crossdistrict differences in the relative scarcity of free local labor and inter-crop differences in economies of scale and skill-intensity (results on mechanisms are not complete).