IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/25700.html
   My bibliography  Save this paper

The Intergenerational Effects of a Large Wealth Shock: White Southerners After the Civil War

Author

Listed:
  • Philipp Ager
  • Leah Platt Boustan
  • Katherine Eriksson

Abstract

The nullification of slave wealth after the U.S. Civil War (1861-65) was one of the largest episodes of wealth compressions in history. We document that white Southern households holding more slave assets in 1860 lost substantially more wealth by 1870, relative to households that had been equally wealthy before the war. Yet, the sons of former slaveholders recovered relative to comparable sons by 1900, and grandsons surpassed their counterparts in educational and occupational attainment by 1940. We find that social networks facilitated this recovery, with sons marrying into other former slaveholding families. Transmission of entrepreneurship and skills appear less central.

Suggested Citation

  • Philipp Ager & Leah Platt Boustan & Katherine Eriksson, 2019. "The Intergenerational Effects of a Large Wealth Shock: White Southerners After the Civil War," NBER Working Papers 25700, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:25700
    Note: CH DAE LS
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w25700.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Luna Bellani & Anselm Hager & Stephan E. Maurer, 2020. "The long shadow of slavery: the persistence of slave owners in Southern law-making," CEP Discussion Papers dp1714, Centre for Economic Performance, LSE.
    2. Reid, Joseph D., 1973. "Sharecropping As An Understandable Market Response: The Post-Bellum South," The Journal of Economic History, Cambridge University Press, vol. 33(1), pages 106-130, March.
    3. Hoyt Bleakley & Joseph Ferrie, 2016. "Shocking Behavior: Random Wealth in Antebellum Georgia and Human Capital Across Generations," The Quarterly Journal of Economics, Oxford University Press, vol. 131(3), pages 1455-1495.
    4. González, Felipe & Marshall, Guillermo & Naidu, Suresh, 2017. "Start-up Nation? Slave Wealth and Entrepreneurship in Civil War Maryland," The Journal of Economic History, Cambridge University Press, vol. 77(2), pages 373-405, June.
    5. Anthony B. Atkinson & Thomas Piketty & Emmanuel Saez, 2011. "Top Incomes in the Long Run of History," Journal of Economic Literature, American Economic Association, vol. 49(1), pages 3-71, March.
    6. Daniel Barth & Nicholas W. Papageorge & Kevin Thom, 2020. "Genetic Endowments and Wealth Inequality," Journal of Political Economy, University of Chicago Press, vol. 128(4), pages 1474-1522.
    7. Simon H. Boserup & Wojciech Kopczuk & Claus T. Kreiner, 2016. "The Role of Bequests in Shaping Wealth Inequality: Evidence from Danish Wealth Records," American Economic Review, American Economic Association, vol. 106(5), pages 656-661, May.
    8. Moritz Kuhn & Moritz Schularick & Ulrike I. Steins, 2020. "Income and Wealth Inequality in America, 1949–2016," Journal of Political Economy, University of Chicago Press, vol. 128(9), pages 3469-3519.
    9. Michael F. Lovenheim, 2011. "The Effect of Liquid Housing Wealth on College Enrollment," Journal of Labor Economics, University of Chicago Press, vol. 29(4), pages 741-771.
    10. Adrian Adermon & Mikael Lindahl & Daniel Waldenström, 2018. "Intergenerational Wealth Mobility and the Role of Inheritance: Evidence from Multiple Generations," Economic Journal, Royal Economic Society, vol. 128(612), pages 482-513, July.
    11. Metzer, Jacob, 1975. "Rational management, modern business practices, and economies of scale in the ante-bellum southern plantations," Explorations in Economic History, Elsevier, vol. 12(2), pages 123-150, April.
    12. Gary S. Becker & Nigel Tomes, 1994. "Human Capital and the Rise and Fall of Families," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition, pages 257-298, National Bureau of Economic Research, Inc.
    13. Sandra E. Black & Paul J. Devereux & Petter Lundborg & Kaveh Majlesi, 2015. "Poor Little Rich Kids? - The Determinants of the Intergenerational Transmission of Wealth," Working Papers 201516, School of Economics, University College Dublin.
    14. Facundo Alvaredo & Bertrand Garbinti & Thomas Piketty, 2017. "On the Share of Inheritance in Aggregate Wealth: Europe and the USA, 1900–2010," Economica, London School of Economics and Political Science, vol. 84(334), pages 239-260, April.
    15. Claudia Olivetti & M. Daniele Paserman, 2015. "In the Name of the Son (and the Daughter): Intergenerational Mobility in the United States, 1850-1940," American Economic Review, American Economic Association, vol. 105(8), pages 2695-2724, August.
    16. Ran Abramitzky & Leah Boustan & Katherine Eriksson & James Feigenbaum & Santiago Pérez, 2021. "Automated Linking of Historical Data," Journal of Economic Literature, American Economic Association, vol. 59(3), pages 865-918, September.
    17. Salisbury, Laura, 2017. "Women's Income and Marriage Markets in the United States: Evidence from the Civil War Pension," The Journal of Economic History, Cambridge University Press, vol. 77(1), pages 1-38, March.
    18. Trevon D. Logan, 2018. "Do Black Politicians Matter?," NBER Working Papers 24190, National Bureau of Economic Research, Inc.
    19. Toman, J.T., 2005. "The gang system and comparative advantage," Explorations in Economic History, Elsevier, vol. 42(2), pages 310-323, April.
    20. Wanamaker, Marianne H., 2014. "Fertility and the Price of Children: Evidence from Slavery and Slave Emancipation," The Journal of Economic History, Cambridge University Press, vol. 74(4), pages 1045-1071, December.
    21. Stanley L. Engerman & Kenneth Lee Sokoloff, 2002. "Factor Endowments, Inequality, and Paths of Development Among New World Economies," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2002), pages 41-110, August.
    22. Dupont, Brandon & Rosenbloom, Joshua L., 2018. "The economic origins of the postwar southern elite," Explorations in Economic History, Elsevier, vol. 68(C), pages 119-131.
    23. Black, Sandra E. & Devereux, Paul J., 2011. "Recent Developments in Intergenerational Mobility," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 16, pages 1487-1541, Elsevier.
    24. Joseph P. Ferrie, 2005. "History Lessons: The End of American Exceptionalism? Mobility in the United States Since 1850," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 199-215, Summer.
    25. Gregory Clark, 2015. "The Son Also Rises: Surnames and the History of Social Mobility," Economics Books, Princeton University Press, edition 1, number 10181-2.
    26. Andreas Fagereng & Magne Mogstad & Marte Rønning, 2021. "Why Do Wealthy Parents Have Wealthy Children?," Journal of Political Economy, University of Chicago Press, vol. 129(3), pages 703-756.
    27. Facundo Alvaredo & Bertrand Garbinti & Thomas Piketty, 2017. "On the Share of Inheritance in Aggregate Wealth: Europe and the USA, 1900–2010," Post-Print halshs-01509650, HAL.
    28. Olmstead, Alan L. & Rhode, Paul W., 2008. "Biological Innovation and Productivity Growth in the Antebellum Cotton Economy," The Journal of Economic History, Cambridge University Press, vol. 68(4), pages 1123-1171, December.
    29. Suresh Naidu, 2010. "Recruitment Restrictions and Labor Markets: Evidence from the Postbellum U.S. South," Journal of Labor Economics, University of Chicago Press, vol. 28(2), pages 413-445, April.
    30. Francesco Caselli & Wilbur John Coleman II, 2001. "The U.S. Structural Transformation and Regional Convergence: A Reinterpretation," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 584-616, June.
    31. Charles W. Calomiris & Jonathan Pritchett, 2016. "Betting on Secession: Quantifying Political Events Surrounding Slavery and the Civil War," American Economic Review, American Economic Association, vol. 106(1), pages 1-23, January.
    32. Fogel, Robert W & Engerman, Stanley L, 1977. "Explaining the Relative Efficiency of Slave Agriculture in the Antebellum South," American Economic Review, American Economic Association, vol. 67(3), pages 275-296, June.
    33. Philipp Ager, 2013. "The Persistence of de Facto Power: Elites and Economic Development in the US South, 1840-1960," Working Papers 0038, European Historical Economics Society (EHES).
    34. Higgs, Robert, 1973. "Race, Tenure, and Resource Allocation in Southern Agriculture, 1910," The Journal of Economic History, Cambridge University Press, vol. 33(1), pages 149-169, March.
    35. Collins, William J. & Zimran, Ariell, 2019. "The economic assimilation of Irish Famine migrants to the United States," Explorations in Economic History, Elsevier, vol. 74(C).
    36. Wright, Gavin, 1974. "Cotton Competition and the Post-Bellum Recovery of the American South," The Journal of Economic History, Cambridge University Press, vol. 34(3), pages 610-635, September.
    37. Eli, Shari & Salisbury, Laura & Shertzer, Allison, 2018. "Ideology and Migration after the American Civil War," The Journal of Economic History, Cambridge University Press, vol. 78(3), pages 822-861, September.
    38. Kearl, J R & Pope, Clayne L, 1986. "Unobservable Family and Individual Contributions to the Distributionsof Income and Wealth," Journal of Labor Economics, University of Chicago Press, vol. 4(3), pages 48-79, July.
    39. James J. Feigenbaum & James Lee & Filippo Mezzanotti, 2018. "Capital Destruction and Economic Growth: The Effects of Sherman's March, 1850-1920," NBER Working Papers 25392, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bertocchi, Graziella & Dimico, Arcangelo, 2020. "Bitter Sugar: Slavery and the Black Family," GLO Discussion Paper Series 564, Global Labor Organization (GLO).
    2. Ekama, Kate & Fourie, Johan & Heese, Hans & Martin, Lisa-Cheree, 2021. "When Cape slavery ended: Introducing a new slave emancipation dataset," Explorations in Economic History, Elsevier, vol. 81(C).
    3. Alberto Alesina & Marlon Seror & David Y. Yang & Yang You & Weihong Zeng, 2020. "Persistence through Revolutions," Working Papers DT/2020/09, DIAL (Développement, Institutions et Mondialisation).
    4. Anbinder, Tyler & Connor, Dylan & O Grada, Cormac & Wegge, Simone, 2021. "The Problem of False Positives in Automated Census Linking: Evidence from Nineteenth-Century New York's Irish Immigrants," CAGE Online Working Paper Series 568, Competitive Advantage in the Global Economy (CAGE).
    5. Alberto F. Alesina & Marlon Seror & David Y. Yang & Yang You & Weihong Zeng, 2020. "Persistence Despite Revolutions," NBER Working Papers 27053, National Bureau of Economic Research, Inc.
    6. Dupraz, Yannick & Ferrara, Andreas, 2021. "Fatherless: The Long-Term Effects of Losing a Father in the U.S. Civil War," CAGE Online Working Paper Series 538, Competitive Advantage in the Global Economy (CAGE).
    7. Graziella Bertocchi & Arcangelo Dimico, 2020. "Bitter Sugar: Slavery and the Black Family," Department of Economics 0172, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
    8. Dupont, Brandon & Rosenbloom, Joshua L., 2020. "Wealth Mobility in the 1860s," ISU General Staff Papers 202009180700001112, Iowa State University, Department of Economics.
    9. Dionissi Aliprantis & Daniel R. Carroll & Eric R. Young, 2019. "The Dynamics of the Racial Wealth Gap," Working Papers 19-18, Federal Reserve Bank of Cleveland.
    10. William J. Collins & Ariell Zimran, 2019. "Working Their Way Up? US Immigrants' Changing Labor Market Assimilation in the Age of Mass Migration," NBER Working Papers 26414, National Bureau of Economic Research, Inc.
    11. Tyler Anbinder & Dylan Connor & Cormac Ó Gráda & Simone Wegge, 2021. "The Problem of False Positives in Automated Census Linking: Evidence from Nineteenth-Century New York's Irish Immigrants," Working Papers 202114, School of Economics, University College Dublin.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bertrand Garbinti & Frédérique Savignac, 2020. "Accounting for Intergenerational Wealth Mobility in France over the 20th Century: Method and Estimations," Working papers 776, Banque de France.
    2. Adrian Adermon & Mikael Lindahl & Mårten Palme, 2021. "Dynastic Human Capital, Inequality, and Intergenerational Mobility," American Economic Review, American Economic Association, vol. 111(5), pages 1523-1548, May.
    3. Bertrand Garbinti & Frédérique Savignac, 2020. "Intergenerational Homeownership in France over the 20th Century," NBER Chapters, in: Measuring Distribution and Mobility of Income and Wealth, National Bureau of Economic Research, Inc.
    4. Catherine Guirkinger & Gani Aldashev & Alisher Aldashev & Maté Fodor, 2020. "Economic Persistence despite Adverse Policies: Evidence from Kyrgyzstan," Working Papers ECARES 2020-39, ULB -- Universite Libre de Bruxelles.
    5. Jung, Yeonha, 2020. "The long reach of cotton in the US South: Tenant farming, mechanization, and low-skill manufacturing," Journal of Development Economics, Elsevier, vol. 143(C).
    6. Barbara Castillo Rico, 2020. "Trends in intergenerational homeownership mobility in France between 1960-2015," AMSE Working Papers 2008, Aix-Marseille School of Economics, France.
    7. Adrian Adermon & Mikael Lindahl & Daniel Waldenström, 2018. "Intergenerational Wealth Mobility and the Role of Inheritance: Evidence from Multiple Generations," Economic Journal, Royal Economic Society, vol. 128(612), pages 482-513, July.
    8. Simon Halphen Boserup & Wojciech Kopczuk & Claus Thustrup Kreiner, 2018. "Born with a Silver Spoon? Danish Evidence on Wealth Inequality in Childhood," Economic Journal, Royal Economic Society, vol. 128(612), pages 514-544, July.
    9. Dupraz, Yannick & Ferrara, Andreas, 2021. "Fatherless: The Long-Term Effects of Losing a Father in the U.S. Civil War," CAGE Online Working Paper Series 538, Competitive Advantage in the Global Economy (CAGE).
    10. Gary S. Becker & Scott Duke Kominers & Kevin M. Murphy & Jörg L. Spenkuch, 2018. "A Theory of Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 126(S1), pages 7-25.
    11. Dupont, Brandon & Rosenbloom, Joshua L., 2018. "The economic origins of the postwar southern elite," Explorations in Economic History, Elsevier, vol. 68(C), pages 119-131.
    12. Jo Blanden & Andrew Eyles & Stephen Machin, 2021. "Trends in Intergenerational Home Ownership and Wealth Transmission," CEPEO Working Paper Series 21-05, UCL Centre for Education Policy and Equalising Opportunities, revised May 2021.
    13. Richard C. Sutch, 2018. "The Economics of African American Slavery: The Cliometrics Debate," NBER Working Papers 25197, National Bureau of Economic Research, Inc.
    14. Koudijs, Peter & Salisbury, Laura, 2020. "Limited liability and investment: Evidence from changes in marital property laws in the US South, 1840–1850," Journal of Financial Economics, Elsevier, vol. 138(1), pages 1-26.
    15. Korom, Philipp, 2016. "Inherited advantage: The importance of inheritance for private wealth accumulation in Europe," MPIfG Discussion Paper 16/11, Max Planck Institute for the Study of Societies.
    16. Andreas Fagereng & Luigi Guiso & Davide Malacrino & Luigi Pistaferri, 2020. "Heterogeneity and Persistence in Returns to Wealth," Econometrica, Econometric Society, vol. 88(1), pages 115-170, January.
    17. Olivetti, Claudia & Paserman, M. Daniele & Salisbury, Laura, 2018. "Three-generation mobility in the United States, 1850–1940: The role of maternal and paternal grandparents," Explorations in Economic History, Elsevier, vol. 70(C), pages 73-90.
    18. Elinder, Mikael & Erixson, Oscar & Waldenström, Daniel, 2018. "Inheritance and wealth inequality: Evidence from population registers," Journal of Public Economics, Elsevier, vol. 165(C), pages 17-30.
    19. Henri Njangang & Alim Beleck & Sosson Tadadjeu & Brice Kamguia, 2021. "Do ICTs drive wealth inequality? Evidence from a dynamic panel analysis," Working Papers of the African Governance and Development Institute. 21/057, African Governance and Development Institute..
    20. Andra C. Ghent & Marianna Kudlyak, 2015. "Intergenerational Linkages in Household Credit," Working Paper 15-14, Federal Reserve Bank of Richmond.

    More about this item

    JEL classification:

    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • N11 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - U.S.; Canada: Pre-1913

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:25700. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.