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Slavery’s Legacy: Race-Based Economic Inequality

Two European researchers find a link between county-level slavery in 1860 and economic inequality today.
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The Old Plantation, c. 1790. (Photo: Public Domain)

The Old Plantation, c. 1790. (Photo: Public Domain)

Thanks largely to the advocacy of Atlantic magazine writer Ta-Nehisi Coates, the idea of paying reparations to African-Americans for slavery and various post-slavery indignities has re-entered the public debate. Inevitably, it has been dismissed by those who view slavery and subsequent Jim Crow laws as an unfortunate legacy, but one that has left no relevant remnants.

Contradicting that assumption, two European economists report they have found “a robust and persistent relationship” between slavery and economic inequality between blacks and whites in today’s America.

“The legacy of slavery still plays a major role in the U.S. economy and society,” conclude Graziella Bertocchi of the University of Modena in Italy and Arcangelo Dimico of Queen’s University Belfast.

"Those U.S. counties that in the past exhibited a higher slave share over population turn out to be still more unequal in the present day."

Their study finds that, in economic terms, “those U.S. counties that in the past exhibited a higher slave share over population turn out to be still more unequal in the present day.”

The primary reason, they suggest, is a continuing gap in educational attainment between blacks and whites.

The study, published in the European Economic Review, uses a sample of U.S. counties to investigate the long-term impact of slavery on economic inequality. The researchers examined counties in 42 states, including 15 slave states, using as a starting point the share of slaves over population in the year 1860.

They then compared those figures with current-day economic inequality in those same counties.

“We find that slavery has a positive and significant effect on overall inequality,” the researchers write. Further digging into the numbers reveals that this finding is driven almost entirely by racial inequality (they found no significant effect of slavery on inequality within races).

What’s driving this continuing correlation? Bertocchi and Dimico cite “the persistence of the racial gap in education,” which is driven in large part by “the legacy of slavery” and “the local nature of education provision and funding.”

“The property tax is the main source of funding for locations/counties, and thus for public education support,” they note. “Because of the ‘separate but equal’ educational policies applied in Southern states until the 1960s, local officers could divert state funding for blacks to finance education for whites. As a result, they could impose a lower property tax and spend less on education.”

Even after legally mandated school segregation was abolished, those counties “still kept a lower tax rate,” the researchers report, “with negative effects on public school funding and, therefore, education for blacks.”

While that may not be the sole reason why blacks continue to lag behind whites economically, the researchers' basic conclusion is clear: “The past use of slave labor persistently affects current inequality." The legacy, sadly, lives on.