FREE labour market and slavery

One of the characteristics of the rural labor market of the Rio de la Plata region was the abundance of land and the scarcity of free workers. Some of the agricultural activities required an intensive labor force in a given season. In these cases, the free labor market was scarce and the workforce was expensive. For this reason, the slaves were a central factor in this economy and one of the main characteristics of the colonial rural areas. According to Amaral (1987), for agricultural producers it was more profitable to employ slaves in those tasks independent of the season. The free workforce was profitable only for certain tasks or periods. However, it was expensive and unnecessary to employ them continuously (Amaral 1987). According to Garavaglia and Gelman (1995), slavery represented a stabilizing element since they were the core of permanent workers on the medium and large properties. The use of slaves was extensive in cattle ranches and farms from Buenos Aires to Rio Grande do Sul. According to Garavaglia (1993), slaves were the most important sector of the dependent labor force. By 1815, the African population in Buenos Aires was about 20.5%, one of each man older than 12 was black or mulato⁴² (Garavaglia 1993). According to Osório (2004), the slave population of Rio Grande do Sul in the period 1787–1807 ranged between 28% and 36%. The slaves were involved in crops in the main cropper province of Buenos Aires (San Isidro), and in the cattle expansion of Rio Grande do Sul in the first half of the 19th century (Garavaglia 1993; Osório 2004). In 1805, slaves were one-third of the population of Montevideo. Frega (2004) points out that there was a decrease in the numbers of slaves from 30% in 1805 to 25% in 1819 after the 1811 revolution.

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Regarding slavery, Mallo (2005) argues that traditionally the regions of the new world are divided in two: the slavery societies and societies with slaves. In the first group are the United States, Cuba, Brazil, Haiti and the territories of the French Caribbean. In these regions, slavery was considered one of the major wealth resources and the basis of a plantation economy. The slaves were also concentrated among a few owners. Slavery as an institution, an economic system and a form of wealth was widely distributed among these economies. According to Schwartz (1982), Over 80 percent of the Bahian engenhos had between twenty and one hundred slaves. Large mills with direct control over more than one hundred slaves were concentrated along the coast. They were few and controlled less than 30 percent of the plantation slaves.

Slavery in Brazil was broadly distributed among the free population, providing the economic basis of the society as a whole and an extremely common and accessible form of investment (Schwartz 1982).

In the second group is included the majority of Spanish America. In these regions, slavery was one of the different types of labor supply, and the slaves were involved in almost all the economic activities: housework, work with crafts, in the rural areas with crops and cattle, in the building industry, and service in the port. In these societies, slaveholding was extensive since many owners had one or two slaves (Mallo 2005). However, the presence of the slaves was less extended than in the slavery societies. Slavery was also an institution but was not one of the main resources of wealth. Nevertheless, even in these societies, it is possible to find some owners with a lot of slaves linked mainly to large properties raising cattle and, in some cases to commercial activities (Boruki 2005).

Bentancur (1997) argues that, in the 1830s, three kinds of coactive works coexisted in Uruguay involved with different racial groups: the slaves, those named colonos (servants), and diverse forms of apprenticeship. Servants and apprentices were hidden ways of forced work given the scarcity of free laborers. The colonos were employed people who arrived from Spain (Vascos,

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Galician and Canarios) with a strict and coactive contract controlled by the authorities. Some forms of apprenticeships were forced work which involved mainly children (Bentancur 1997).

The slaves were also required to work for other owners due to labor scarcity. In general, the salary was retained by the slaveholder. According to Boruki et al. (2004), this practice was extended to Montevideo and its surroundings. Through this resource, when they could obtain payment, the slaves were able to buy some goods and even their freedom (Boruki, Stalla and Chagas 2004).

The abolition of slavery in Uruguay took place during the wars against Rosas (1839–1851) in a pressing situation which allowed the incorporation of slaves into military service. The final resolution was in December 1842; however, it is possible to find the remnants of slavery for two decades after the abolition. Furthermore, the semi-slave work remained at the border with Rio Grande do Sul until the slavery abolition in Brazil in 1888 (Boruki 2005).

But, is slaveholding representative of wealth? Is it possible to estimate wealth through slaveholding? According to the literature, slaveholding represented an investment for the owner. The slaves formed a stable workforce in periods of labor scarcity. The investment in slaves meant in this period an investment in physical capital, even though these economies often combined three kinds of work: the free, slave and familiar labor force.

5.5M^ETHODS

The study of wealth and income distribution and the relation between early Human capital and wealth require different groups of sources and methods. The collection of the original sources was one of the large efforts of this paper since required different kind of documents. In this section, we first describe deeply the sources collected and the descriptive statistics, second we

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explain the index to approximate to the early Human capital formation given by the age heaping technique, and finally we describe the methods to estimate wealth and income inequality.