Indentured servants, whites bound to service for a limited amount of time, were an important part of the labor force in colonial America. In many areas, they outnumbered slaves during the 17C. During the 18C, slaves were substituted for servants in the production of sugar in the West Indies, tobacco in the Chesapeake colonies, and rice in South Carolina, but indentured servants continued to be important in the supply of skilled craftsmen and managers.

In exchange for labor over the specified period, indentured servants received transportation from England to a colonial destination, maintenance (food and housing) for a specified period, and freedom dues, a cash payment at the end of the contract period. Agreeing to the contract was a means for a servant to borrow the funds needed to get to the colonies. Summarize in words or equation a model that would explain the length of a servant’s indenture.

In his study of indentured servitude, Economist David Galenson found that, at a given time, the price of passage from England to the colonies did not vary among individuals or among colonial destinations. Also, maintenance costs and freedom dues did not vary much among individuals. How would you expect the length of indenture to vary with marginal revenue product? Would literate or illiterate workers be bound by longer contracts? When indentured servants were used in the production of sugar, explain how you would expect a reduction in the price of sugar to affect the length of indenture. Galenson found that women’s contracts were between 5% and 15% shorter than men’s through the age of 17, but there was no sex differential for older servants. What would you conclude about the relative productivity of women and men at different ages?