There are many factors that contribute to an understanding of economic growth during the postbellum period. Two of the factors that can shed some light on the situation at the time are sharecropping and economic inequality. Conventional views of sharecropping tend to consider the practice as inefficient. Sharecropping did increase, however. Between 1880 and 1910 in the United States, owner-operated farms, as a proportion of all farms, decreased from 64 to 50% in the South and from 74 to 63% in the nation. In 1880, 12% of farms in the South were rented and 24% were sharecropped; the corresponding percentages were 8% rented and 18% sharecropped for the entire United States.[1] The economic situation and institutional arrangement of the postbellum period contributed to the expansion of sharecropping. Southern farmers faced a major problem in trying to acquire capital after the Civil War. Since banks and lending institutions had mostly not existed in the agricultural South, money was scarce, and farming required significant capital. According to  Martin A. Garrett Jr and Xu Zhenhui, “Even fixed-rent farming required renters to provide all inputs, including draft animals.”[2] In the absence of the needed capital, farming could be extremely challenging. Even if capital became available, many freed slaves did not have the expertise required to farm for themselves. The initial promise of 40 acres of land and a mule to a freed slave was wiped out when President Johnson granted amnesty to ex-confederates. As a result of these factors, farmers had to look for a new working relationship. That new working relationship was sharecropping. Farming in the South was seasonal and required workers during the planting and harvesting periods. Low wages and the migration of workers often created problems for the farm owners in finding adequate labor. The free labor force on the farm presented other problems. They could not be motivated, supervised or kept honest as before emancipation. “The final transition to sharecropping probably lies in the increased effectiveness of the incentives implicit in the share arrangement, more closely matching effort and reward at the individual family level.”[3]

            According to Stephen J. DeCanio, “Economic inequality between blacks and whites in the postbellum South can be attributed to two factors: racial discrimination and the absence of any redistribution of tangible wealth to accompany emancipation.”[4] There are typically two types of explanations for the absence of tangible wealth by blacks after emancipation. The first is based on discrimination. Blacks were denied equal employment and educational opportunities. Additionally, they were discriminated against when it came to credit and in dealing with the retail market. These conditions continued to contribute to low incomes of blacks in the postbellum period. The second factor contributing to economic inequality between blacks and whites is the lack of capital by blacks. They had recently been slaves who did not own property and had no assets. They had no bank accounts or credit history. The unequal ownership of property by blacks and whites in the postbellum South was the chief source of race-related economic inequality. The blacks’ emancipation with zero wealth accounts for most of the gap in income between blacks and whites during the Reconstruction period. There were many Southerners who created an economic system that failed to reward individual initiative on the part of blacks and was therefore ill-suited to their economic advancement.[5] “As a result,” writes DeCanio, “inequalities originally inherited from slavery persisted.”[6] Aside form the actions of Southerners who did not want to see backs succeed, the principle source of inequality between blacks and whites in the postbellum South lay with unequal property ownership and the lack of available capital for blacks. The adoption of sharecropping during the postbellum period offered planters, blacks, and some poor whites the opportunity to improve their lot. However, many planters throughout the South constructed forms of sharecropping that limited the cropper from selling crops for better prices. Sharecropping contracts defined sharecropping as wage labor, subjecting the croppers to closer supervision than those who simply rented land from the planter. Sharecropping eliminated the pain of slavery but also contributed to the dreadful poverty of the region as planters gained more from the system. While blacks were emancipated, those who participated in sharecropping were tied to the land and in many cases did the same work as they performed when they were slaves. While some people rented land from planters, most blacks were not able to do that and found themselves with limited choices. Joseph Reid concluded that the desirability of redistributing risk between landlords and labor in a sharecropping was a major factor in the rise of agricultural tenancy in the postbellum South.[7]

 

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[1] Joseph D. Reid. “Sharecropping as an understandable market response-The postbellum South.”

Journal of Economic History (1973): 33, 111.

[2] Martin A. Garrett Jr and Xu Zhenhui. “The Efficiency of Sharecropping: Evidence from the Postbellum South.” Southern Economic Journal 69, no. 3 (2003): 578-95. Accessed January 27, 2021. https://www. jstor.org/stable/ 1061695.

[3] Ibid.

[4] Stephen J. DeCanio. “Accumulation and discrimination in the postbellum South.” Explorations in Economic History, Volume 16, Issue 2 (1979): 182-206. Accessed January 27, 2021. https:// doi.org/ 10.1016/0014-4983(79)90014-7.

[5] Ibid.

[6] Ibid.

[7] Reid, 127.