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The Demand for Land: The United States, 1820–1860

Published online by Cambridge University Press:  03 March 2009

Stanley Lebergott
Stanley Lebergott
Affiliation:
The author is Professor of Economics, Wesleyan University, Middletown, Connecticut 06457, and President of the Economic History Association.
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Abstract

The demand for land in the United States was shaped by inherited attitudes and modern asset creation. Immigrants inherited the view that landowners had an enhanced chance of survival in a “starving time.” But the United States farmer also found that by clearing his unimproved acres he could create assets from otherwise idle time between seasonal peaks in the use of family labor. Public land sales in the South from 1820 to 1860 correlate well with variables that reflect expected money return and supply price. Substantial residuals for 1835–1837 chiefly trace to specific policy actions in Washington.

Type
Papers Presented at the Forty-fourth Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 45 , Issue 2 , June 1985 , pp. 181 - 212
Copyright
Copyright © The Economic History Association 1985

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17 Lebergott, Stanley, The Americans: An Economic Record (New York, 1984), p. 15.Google Scholar In two years' work a farm laborer could save enough to buy a quarter section, land, horse, plough, and tools according to Fordham, Elias, Personal Narrative of Travels in Virginia, Maryland, Pennsylvania, Ohio, Indiana, Kentucky, and of a Residence in the Illinois Territory, 1817–1818 (Cleveland, 1906), p. 211. At that rate six months of work would certainly permit buying 10 acres.Google Scholar“Michigan land having been principally purchased of the United States for cash, nearly every man in the State is a proprietor of the soil.” A Statistical Sketch of the State of Michigan (New York, 1838), p. 14.Google Scholar

18 Veblen, Thorstein, Absentee Ownership (New York, 1923), p. 135. Or, as an earlier writer put it: “Speculation in real estate has for many years been the ruling idea and occupation of the Western mind. Clerks, labourers, farmers, storekeepers, merely followed their callings for a living, while they were speculating for their fortunes. The people of the West became dealers in land, rather than its cultivators.… the great Western staple [was] the Progress of the Country.”Google ScholarMitchell, D. W., Ten Years in the United States (London, 1862), pp. 325–29.Google Scholar

19 Even in 1900 the modal farm had only 10 grazing animals, meaning that no more than about 5 acres were required to grow the hay and grain required by that number of animals. U.S. Census Office, Census of Agriculture, 1900 (Washington, D.C., 1902), part 1, pp. 370–71.Google Scholar Feed requirements in 1850 are from Lebergott, The Americans, p. 23. Pasture requirements are generously estimated, since the number of animals per farm was surely less in 1850 than 1900, and hay yields were higher in the North Central than North Atlantic region. Bogue describes settlers of prairie farms in Iowa in the 1850s as “in many cases purchas[ing] small timber lots often or twenty acres” from which they “sized out building timber or rails and cut firewood.”Google ScholarBogue, Allan, From Prairie to Corn Belt (Chicago, 1963), p. 48.Google ScholarNiles (June 18, 1817) estimates an average of one cord of wood per person. Seaman estimates 1.5 cords, while Gallman infers 4.4 cords in 1839.Google Scholar(See Gallman, Robert, “Gross National Product in the United States, 1834–1909,” in Output, Employment, and Productivity in the United States after 1800, Studies in Income and Wealth 30 (New York, 1966), p. 33.Google ScholarNorris, James in Frontier Iron (Madison, Wisc., 1964), pp. 45–46, 179 estimates that an acre of forest reproduced itself in 20 years, yielding 15 to 20 cords of timber a year in second growth.Google Scholar

20 “For the people throughout are set upon establishing their children in land estates, which is difficult to manage in the older parts, and hence the incessant migrations to the farther regions.” Schoepf, Johann, Travels in the Confederation, 1783–1784 (reprinted, New York, 1968), p. 36. The stream of fundamental inquiries by Yasukichi Yasuba, Richard Easterlin, Peter Lindert, and others has recently told us much about the links between fertility and landownership.Google Scholar

21 Bounty warrant price estimates of Natalie Disbrow, quoted in Swierenga, Robert, Pioneers and Profits (Ann Arbor, Mich., 1967)Google Scholar, Table 6.1. Paul Gates provides a graph of warrant prices in his History of Public Land Law Development (washington, D.C., 1968), p. 278. In a letter of January 30, 1979 he kindly informed me that his figures were chiefly for 160-acre warrants, drawn from the New York Tribune, Bank Note Reporters, and newspapers in the public land area.Google Scholar

22 For such market rates see Severson, cited in Lebergott, The Americans, p. 320.Google Scholar

23 See farm laborer wage data in Lebergott, , Manpower in Economic Growth (New York, 1964), p. 539 for the west Central region in 1850.Google Scholar

24 Cotton fields were picked over three times according to Gray, L. C., History ofAgriculture in the Southern United States to 1860 (Washington, D.C., 1933), vol. 2, p. 702.Google Scholar The picking spread over 122 days in later years, Shepperson, A., Cotton Facts (New York, 1906), p. 1. Picking and hauling hours are summed for the harvest period.Google Scholar

25 A two-week wheat harvest period in the 1850s (beyond which the grain would “get too ripe and fall”) is estimated by Marsh, Charles W., Recollections, 1837–1910 (Chicago, 1910), p. 70.Google Scholar See also Rogin, Leo, The Introduction of Farm Machinery in its Relation to the Productivity of Labor in Agriculture of the United States during the Nineteenth Century (Berkeley, 1931), p. 78.Google Scholar

26 Prairie Farmer in 1850Google Scholar, quoted in Gates, Paul, The Farmer's Age: Agriculture 1815–1860 (New York, 1960), p. 166.Google Scholar

27 For picking rates see Lebergott, The Americans p. 168. It is possible, but unlikely, that the early planters exhibited lower picking rates because they were gentler to their slaves than later ones.Google Scholar

28 For the ratio of horses to oxen by region, which proxies this change, see Lebergott, The Americans, p. 299.Google Scholar

29 As noted above the Illinois Central charged 3 percent on its lands while market rates ran 10 to 12 percent. Midwestern interest rates of 10 to 12 percent prior to 1860 are reported by Severson, while Southern rates of 10 percent and above were common. See sources in Lebergott, The Americans, pp. 320, 214–15.Google Scholar

30 Georgescu-Roegen has spoken of the “inherent idleness” in farming. “Should we try to find different agricultural activities which, if spliced, would completely eliminate the idleness of the farmer and his implements we will discover an insuperable obstacle. Nature forbid [man] stopping an agricultural process until it is completed.” Georgescu-Roegen, Nicholas, The Entropy Law and the Economic Process (Cambridge, Mass., 1971), p. 252.CrossRefGoogle Scholar

31 The constant impounds the value of farm buildings, and other improvements present in the total cash value. The census data are from DeBow, J. D. B., Statistical View of the United States (Washington, D.C., 1954), pp. 169, 220 ff. Excluded are the county in each state with the largest urban area—for example, Cook, St. Louis.Google Scholar

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33 Gailman has kindly provided estimates from his ongoing work on United States capital formation. For 1850 these estimates vary by 30 percent as the percent of stumps removed is varied from none to all. Variation because of density is noted in Schob, David, Hired Hands and Plowboys (Urbana, Ill., 1975), pp. 10, 16.Google Scholar

34 Actually the net contribution by an adult son to a family is less than a year's wage if one reckons in the expense of raising children to the age at which they became self-sufficient.Google Scholar

35 The acreage cleared would represent almost pure capital gain if he, a family member, or laborer hired by the month, utilized time that would otherwise have been wasted. Where, however, the farmer hired the breaking presumably he thought an earlier start on a larger crop was financially advantageous. Prevailing views of the poverty of early farmers would suggest that such farmers did not hire much breaking. “A healthy man … in the first year might … clear and sow …ten acres.” Patent Office Report quoted by Danhof, Clarence, Change in Agriculture (Cambridge, Mass., 1969), p. 115. On forested land, Danhof noted earlier, he might take 10 to 15 years to clear the 40 acres. The prairie farmer might clear 80 acres in two years by hiring the breaking.Google Scholar See Carstensen, Vernon, ed., The Public Lands (Madison, Wisc., 1963), p. 264.Google Scholar

36 The multiplicity of these vanished proponents is revealed in Craven's, AverySoil Exhaustion as a Factor in the Agricultural History of Virginia and Maryland, 1606–1860 (Urbana, Ill., 1926).Google ScholarDanhof, Agriculture, p. 257, describes migration as a response to “failure of their techniques.” He adds: “Geographic mobility served as a cover for mental inadaptability.”Google Scholar

37 Bogart, Ernest, Economic History of the American People, (New York, 1933), p. 304.Google Scholar

38 Genovese, Eugene, The Political Economy of Slavery (New York, 1965), p. 89. “This one crop system perpetuated by slavery prevented crop rotation; the dearth of liquid capital made the purchase of fertilizer difficult; the poor quality of the implements that planters could entrust to slaves interfered with the proper use of available manures; and the carelessness of slaves made all attempts at soil reclamation or improved tillage of doubtful outcome.” In these, and other statements, he seems to imply that the preferred solution for the South required fertilizing older soils—but that solution was precluded by slavery. From this, may flow his inference that “The South had to expand, and its leaders knew it,” p. 260.Google Scholar

39 Ruffin, Edmund, An Essay on Calcareous Manures (reprinted, Cambridge, Mass., 1961).CrossRefGoogle Scholar

40 Primack, Martin, “Land Clearing Under Nineteenth-Century Techniques: Some Preliminary Calculation,” this JOURNAL, 22 (12. 1962), p. 144 stipulated 400 bushels as “enough”;,. 145 recommends 333; p. 182 argues for 250–300 on worn acid soils and suggests that more would in fact produce disease. See also pp. 101, 104, 98. On p. 199 he calculates $2 when marling at 259 bushels per acre. On p. 195 he estimates 1.75 cents per bushel. On p. 198 he estimates $3.57 for 400 bushels per acre. At a 350-bushel rate, the average of these three estimates (2.80, 6.10, 3.10) is $4.Google Scholar

41 On p. 127 he says that the increase of the first crop on worn acid soil is never under 50 percent and often as much as 100 percent. His experimental data, from pages 86–102 show: 27.5 to 33.25; 8 to 17; 7 to 13; 5 to 11; 7 to 16 and 22; 13 to 18; 7 to 12, 13, and 15. Thus, of 8 experiments, 5 report gains of 6 bushels or less.Google Scholar

42 Census of Agriculture, 1860 (Washington, D.C., 1864), p. lvi. We use the increment in bushels of corn and the price per ton of fertilizer from this source for Table 4 below. We do not refer to other fertilizers because their yield was inferior or price data were not given. The fertilizer advantage in corn, a major southern crop, should indicate the financial advantage in other crops: the many acres under corn would have been put under cotton or tobacco had the latter been more rewarding.Google Scholar

43 U.S.D.A. Technical Bulletin No. 1254, Pearson, R. W. et al., Residual Effects of Fall- and Spring-Applied Nitrogen Fertilizers (Washington, D.C., 1961), pp. 11–12. At a 150-pound rate nitrates produced 48 additional bushels of corn per acre in the first year, plus 19 more a year later. At a 100-pound rate the gains were 43 and 7 and at 200 pounds, something like 50 and 19. A 40 percent gain is inferred for the second year. These results lead to somewhat higher benefits from fertilizing than those suggested by Ruffin or Genovese.Google ScholarRuffin (p. 128) indicates that “the greater part” of marl does not begin to act before several years. Genovese (p. 94) asserts that “since the effects [of guano] were not lasting he [the planter] would have had to spend it regularly.”Google Scholar

44 A $20 per acre figure is based on the cost of improvement in Table 3 above, and a I dollar purchase price.Google Scholar

45 Gates, Farmer's Age, p. 172 reports a common yield of corn in Ohio of 50–80 bushels. Ruffin An Essay on Calcareous Manures, p. 133, suggests that “corn yielding 25 or 30 bushels to the acre [in Virginia] is doubled by many natural soils in the Western States.”Google Scholar

46 Genovese stipulates much higher costs than these: A minimum of $7.50 per acre for manure alone; guano at $10–20 per acre; and $800 worth of barnyard manure to restore one acre of Kentucky land. Political Economy, pp. 95, 91, 94. Had further allowances been made for the uncertain consequence of utilizing marl, given the then state of knowledge, that policy would have been still more unsatisfactory. Ruffin gives a litany of the injuriés that his favorite marl could do to corn if the wrong amounts were used. He clearly did not know what amount was suited to various types of soil. (An Essay on Calcareous Manures, p. 120).Google Scholar

47 Smith, Alfred G., Economic Readjustment of an Old Cotton State (Columbia, S.C., 1958), p. 97.Google Scholar

48 Odd, if indirect, confirmation of all this comes from Ruffin. To his own query “What distance from the pit may marl be profitably carried?” He replied: when “poor land abundantly supplied with fossil shells may be bought at from two dollars to four dollars an acre, a farmer had better buy and marl a new farm than to move marl even two miles to his land in possession.” Essay on Calcareous Manures, p. 146. But if poor Virginia land were worth buying at $2-$4, merely because its marl pits provided cheap fertilizer, would not Arkansas land at I dollar an acre be a still better buy? Its fertilizer had already been distributed by nature.Google Scholar

49 Betts, Edwin M., Thomas Jefferson's Farm Book (Princeton, N.J., 1953), p. 194.Google Scholar See also Jefferson's, Notes on The State of Virginia (Boston, 1832), p. 175: It is cheaper to cultivate an acre in a new field of tobacco than to manure an old one.Google Scholar

50 See also National Resources Board, Report of Land Planning, part 7,Google ScholarCertain Aspects of Land Problems and Government Land Policies (Washington, D.C., 1935), pp. 65 ff.;Google ScholarGates, Paul, Farmer's Age, pp. 80 ff.;Google ScholarGates, Paul, Landlords and Tenants on the Prairie Frontier (Ithaca, N.Y., 1973).Google Scholar

51 Shannon, Fred A., The Farmer's Last Frontier (New York, 1961), p. 71.Google Scholar

52 Gates, Paul, A History of Public Land Law Development, p. 207.Google Scholar

53 Gates, Paul, “The Homestead Law in an Incongruous Land System,” American Historical Review, 41 (07 1936), p. 662. Gates also emphasizes “land monopolization… in the middle eighties” for a California total of under 2 million acres. He alludes to a congressional report for the late 1870s surmising that 21 million acres in large estates were owned by foreigners. And finally he points to a 1913 estimate that Weyerhauser and some others held 12 million acres. But concentration for example, in the midwest in the 1850s did not necessarily continue until the northwestern concentration of timber holdings in 1913. See his description in National Resources Board,CrossRefGoogle ScholarReport, pp. 65 ff.Google Scholar

54 Historical Statistics, vol 2, p. 239 shows 1.9 billion acres from 1850 onward.Google Scholar

55 Oberly, James, “Acres and Old Men: Military Bounty Land Warrants, 1847–1860,” (Ph.D. diss., University of Rochester, 1982), tables 12, 17, 18, 30–32.Google Scholar

56 Soltow's percentages for the 50, 60, 70, 80, 90, 95 and 99th percentiles ran as follows:.38,. 58,. 66,. 66,. 65,. 59,. 52. The marked increase from the 50th percentile to the 60th is puzzling, but does not seem to effect our conclusion.Google Scholar

57 United States Federal Trade Commission, National Wealth and Income (1926), p. 62. The FTC survey covered 40,000 estates probated in this period. Estates above $500,000 held 18 percent in land; those with $1000 to $2500 held 40 percent; and the entire sample held 33 percent.Google Scholar

58 Evans, Paul, The Holland Company, (Buffalo, N.Y., 1924);Google ScholarMcNall, Neil, An Agricultural History of the Genesee Valley (Philadelphia, 1952), p. 46.Google ScholarSwierenga, Robert, Pioneers and Profits: Land Speculation on the Iowa Frontier (Ames, Iowa, 1968), p. 227 argues the contrary, but his data, for one county, do not allow for possible differences in locational factors.Google Scholar

59 With a great deal taken in other “Western States.” American State Papers, Finance, 2 (January 1812), p. 525.Google Scholar

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66 General Theory, pp. 150–51.Google Scholar

67 Bogue, Allan, From Prairie to Corn Belt (Chicago, 1963), p. 193.Google Scholar See also Governor Hammond's 1858 comment: “while the fertile regions of the Southwest are open to the cotton planter it is vain to expect them to embark… in improvements which are expensive, difficult or hazardous.” Quoted in Hammond, M. B., The Cotton Industry (New York, 1897), p. 85.Google Scholar

68 In which the relative cost of buying new assets compared to buying existing ones constitutes the stimulus to new production.Google Scholar

69 Marshall, Alfred, Principles of Economics (New York, 1946), V, xi, 3. A long tradition led merchants, India nabobs, and other English parvenus to buy landed estates. These typically earned less than the going interest rate.Google Scholar See Nicolson, Harold, Good Behavior (Garden City, N.Y., 1956), p. 188.Google ScholarStendhal, Life of Henri Brulard, chap. 18: “this mania has its source… in avarice, in pride and in the mania for nobility.”Google Scholar

70 People (May 16, 1977) p. 88. “Financed by a credit line on Jane's future earnings” the purchase was made by her husband. She was then planning a movie which, in her words, was “about a man and a woman who want nothing more than to own a piece of land and be left alone.”Google Scholar

71 “The argument for this rule is simple: when investment is reversible then the firm can buy a unit of capital goods, use it and derive its marginal product from an arbitrary short time span, and then sell the undepreciated portion, possibly at a different price.” Arrow, Kenneth, “Optimal Capital Policy with Irreversible Investment,” in Wolfe, J. N., ed., Value, Capital, and Growth (Edinburgh, 1968).Google Scholar

72 See his From Prairie to Corn Belt (Chicago, 1963), p. 51. The omitted words are: “of the size he thought necessary for his farming operations, and then tilled the farm.” See the many examples in Swierenga, Pioneers, pp. 11–17.Google Scholar

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75 The Immigrants Guide to Minnesota in 1856, by an Old Resident (St. Anthony, Minn., 1856), p. 68.Google Scholar

76 A similar model for the North Central region, and derivation of the necessary bounty land data will, it is hoped, be presented elsewhere. (Bounty locations, if added to cash sales in the south, yield similar conclusions to those reported here.)Google Scholar

77 DeBow, Statistical View, p. 176. Of the considerable acreage under corn most produced an intermediate product consumed by slaves and animals.Google Scholar

78 The classic article by Cole, Arthur, “Cyclical and Sectional Variations in the Sale of Public Lands, 1816–60,” Review of Economics and Statistics (January 1927), pp. 41–53, graphed sales against current rather than deflated cotton prices.Google Scholar See also North, Douglass, The Economic Growth of the United States 1970 to 1860 (New York, 1961), p. 124.Google Scholar

79 Boston Prison Discipline Society, Second Report (Boston, 1827), p. 40.Google Scholar

80 Davis, Andrew M., The Origin of the National Banking System (Washington, D.C., 1910), pp. 15, 24. Davis estimates 6 types of notes per bank, which are mutliplied by his count of banks.Google Scholar

81 Investments in sterling were, inevitably, affected by variations in exchange rates.Google Scholar

82 For 1819 to 1856 see Homer, Sidney, A History of Interest Rates (New Brunswick, N.J., 1963), pp. 286–87, 299.Google Scholar For 1857 to 1860 see Macaulay, Frederick, Some Theoretical Problems Suggested by the Movements of Interest Rates, Bond Yields and Stock Prices in the United States since 1856 (New York, 1938), pp. A 174 ff. A few missing years were interpolated by Homer's United States Federal Government rates.Google Scholar

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87 The price varied only trivially by auctions of choice parcels. In practice “the government” turns out to be a set of individuals. The record is filled with auctions in which government officials “allowed” buyers to prevent bids over $1.25. They then reauctioned the land among themselves, sharing the excess value. See the lively tale of Chocchuma, in 23rd Cong. 2nd sess. H.D. 22, Commissions and Letter of Instructions (Washington, D.C., 1834).Google Scholar

88 The 85 percent figure is derived from our sampling of approximately 4,190 warrants in the National Archives.Google Scholar

89 The 85 cent average price at which warrants sold is computed from the data of Natalie Disbrow. See Swierenga, Pioneers, p. 145.Google Scholar

90 From 1820 to 1831, 80 acres at $1.25; from 1832 to 1847,40 acres at $1.25; from 1847 to 1853, 40 acres at 85 cents, the price at which bounty warrants could be purchased.Google Scholar

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