David R. Henderson  

Did the North and South Converge?

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Former Econlog blogger Arnold Kling's latest post is titled "Why Did the South Not Converge?" In it, he quotes from a book by Ira Katznelson and goes on to suggest various factors behind the failure of per capita incomes in the northern and southern states to converge.

Here's the problem: according to Robert J. Barro and Xavier Sala i Martin, they did converge. Their paper is here. Their paper was published in 1990 and I guess there could be some more-recent research showing that their data are wrong.

When I was writing my review of Acemoglu and Robinson's Why Nations Fail, my economic historian friend Jeff Hummel told me that it's widely accepted among economic historians that per capita incomes post-Civil War converged. Are Jeff Hummel and I wrong? Is there research on this that overturns this result?

UPDATE: A regular reader of Econlog has sent me this link to another paper by Barro and Sala i Martin. On page 122 is a nice graph of the convergence from 1880 on.

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CATEGORIES: Economic History

COMMENTS (2 to date)
Methinks writes:

I'm having trouble with parts of the racism argument.

in the 1880's and 1890's blacks were being elected to office by a mostly white electorate and upper class blacks attended schools and social events with whites. That wasn't happening in the South and does imply that the North was less racist than the South - enough to make a pretty big difference to a black person deciding to where to live.

In 1890, 90% of all blacks still lived in the South, but waves of black migration (first from the upper South and then the lower South) swelled Northern black populations in the first decades of the 20th century. In Chicago, the population grew from 30,000 in 1900 to over 100,000 in 1920 and exceeded 277,000 by 1940. Other Northern cities experienced a similar influx of black refugees from the South. For instance, migration increased New York's black population from 60,000 in 1900 to 450,000 by 1940. While migration picked up between 1940 and 1960, it wasn't insignificant before that and the rate of migration increased in each decade.*

I'm not sure why capitalists wouldn't take advantage of black labour in the South. Blacks and whites don't need to work together in the same job. I would think a capitalist would be happy to take advantage of a cheaper all-black labour force if whites were unwilling. Also the problem of a black boss could be solved by hiring only whites or hiring black managers to oversee a black workforce. This was a period in history when this would be socially acceptable. Although, I doubt that poor whites would have been so unwilling to work with blacks in the same jobs.

*These facts and figures were all lifted from Thomas Sowell's "Black Rednecks and White Liberals".

Seth writes:

Some of the convergence in Barro's et al papers appear to include government transfers. I'm not smart enough to figure out how much.

I would also wonder how much if is from military bases.

I think what most people think about, if they've visited the South and North, is the evidence they see with their own eyes. The figures in Barro's paper does not appear to square with that.

Methinks lifts stats from one of the best emergent order books I've ever read, Sowell's "Black Rednecks and White Liberals." The emergent order he discusses in it is culture.

The lead-off from that book has stuck with for a long time:

""These people are creating a terrible problem in our cities. They can't or won't hold a job, they flout the law constantly and neglect their children, they drink too much and their moral standards would shame an alley cat. For some reason or other, they refuse to accommodate themselves to any kind of decent, civilized life."

That was said in 1956 in Indianapolis, not about blacks or other minorities, but about poor whites from the South."

Sowell offers an element of explanation in the difference we see with our own eyes in the North and South that isn't often discussed. Inasmuch as there has been convergence between the North and South, I think it's worth asking, how much of that came from migration and transfers and how much came from organic improvement in living standards in the South and why.

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