What exactly do you mean by 'efficient'?
I mean, the obvious effect is that the wealth is concentrated in the ruling class, whose spending habits mean that production ends up geared towards providing the ruling class with luxury items. This has a bad ratio of utility gained to factors of production used. But for all I know, maybe your standard of the economy's efficiency doesn't involve utility at all.
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In a slave economy the slave only does the bare minimum of work in order to avoid being beaten or killed. They'll slack off at any opportunity simply because they never benefit from doing good work. If a paid worker slacks off, you can dock his pay and reclaim some of the resources spent to employ him. If a slave slacks off you have to spend time and energy disciplining him with either beatings or torture.
Slaves also cost money to keep. You've got to pay for their food and have a place for them to sleep. If one of them falls sick then you either pay for a doctor or loose your property. You can save money by keeping them in squalor but that's a hotbed for disease.
You can never reliably convince slaves that they should be slaves. Sure, you can torture them for hours until you hear them agree with you but they'll never truly be convinced by torture. You'll always have slaves that run away or slaves that rebel so you need to keep watching them and never put them in a position of trust.
It's not a simple argument. From what I understand, it boils down to this. People do better at what they want to do rather then what someone else wants them to do. For example, Howard Tayler of Schlock Mercenary works harder for less money doing Schlock then he did for Novell. Why is he working harder for a smaller reward? Becuase it is what he wants to do, not what Novell wants to do.
Also, note that there have been societies where slaves can hold high office. Chattle Slavery as practiced in modern times is not the only way to do it.
edited 17th Jul '13 6:52:15 PM by soban
Yes, that's a good point, Soban. I had iron age and previous-ages slavery in mind, NOT the much more recent race-based plantation slavery of the US An south. And indeed, in some past periods, some slaves were given positions of trust, even fairly high office.
edit: Also many slaves, in some past periods, bought into the notion that it was 100% proper for some people to be slaves, e.g. as justified in the Norse myth of "Frey's Wandering".
edited 18th Jul '13 2:16:50 AM by Peter34
That slavery is less efficient is not some sort of universal law. Efficiency is in the first place a strawman. It has only meaning if you actually define what efficiency you measure. Anyway, the reason why slavery in the 19th century became impractical is not so much because of motivation but because of innovation. Without slaves there is always incentive for further industrialization and optimization of production via machines, education, design and anything else that will maximize the hourly output of the (paid) workers. With slaves, not so much.
In an iron age context however, slavery would be arguably better than non-slavery. Take for example the Spartans, a caste of aristocratic warriors can only work when there is someone else producing the food for them. Slavery also allows for much bigger farms, where economics of scale come into play (although that is what in the end, was a big factor in the end of rome)
So, slavery is not necessarily less "efficient" it all depends upon the context.
Note that their heavy dependency on slavery played a huge part in the eventual downfall of the spartans, since they had to spend a lot of effort simply to control the helot population.
But that only became a problem once the number of holdings declined and the size grew (and thus the number of Spartans declined) which has nothing to do with slavery itself and was due to the way they handled inheritance.
The military oriented society that the spartans created was in response to having several times their population in slaves. They believed that each spartan needed to be worth eight helots in order to maintain control of their massive slave population so they did everything they could in order to make the spartan men unbeatable in battle.
This mean that spartan women would need to pick up the slack in society as overseers and naturally became more dominant. This led to the odd inheritance laws. It also didn't help that the other greeks figured out that they can train their soldiers to compete with the spartans without spending their entire lives doing so.
Honestly, the whole Spartan thing is completely overblown by pop culture anyway. (300 probably had a lot to do with that even though that film was pretty awesome in a brainless, testosterone-dripping pro-fascism way) While the Spartan military did dominate Greece for a while, so did other cities during their heyday. To pick just one example, the Spartans didn't actually have a reputation for always fighting until victory or to the death. (The Thespiai did though) And while Thermopylae was pretty impressive, and imo also quite important, it is pretty unfair to just ignore the thousand Thebans and Thespiai who also fought in the suicide rearguard action. (Not to mention that the Spartans probably didn't send their accompanying Helots home either) And ironically enough that it later was the Thebans who kicked Spartan asses weakening them enough to allow Helot riots and breaking Spartan dominance in Greece. And this thread has been totally derailed now. :D
There is an economic standard of efficiency. It mostly revolves around how much output do you get per hour of work per man. Output per Man-hour if that's less confusing.
Pre-industrial revolution there isn't much difference between a freeman's work and a slave's work. There's some nickel and dime differences between keeping slaves and paying workers. Paid workers will feed and house themselves out of their own wages (So you don't have to run around finding a place to keep them) and generally work harder (since those that don't want to be here probably already left) but you can force slaves to do hazardous work for a pittance if you don't mind loosing most of them.
There is some efficiency lost as slaves can't migrate to more in demand jobs or better employers but I digress.
During the industrial revolution high quality tools and ample food suddenly was within the reach of the average worker. If a worker saved his money he could afford tools that increase his output. Maybe he gets a trolly instead of carting stuff around by hand. Maybe he gets a band saw rather than cutting planks with an axe. He might also get more food and actual meat so his strength and stamina improves.
a slave can do none of this because he has no money. Everything goes to his owner. Now a wise master would invest in their slave, paying for extra food and training. Skilled slaves were lucrative trade and slavemasters often got very, very rich. The most well known skilled slaves were the gladiators. Nobody wanted to see absolutely pathetic slaves get butchered. That's what the condemned prisoners were for. People wanted to see skilled and courageous performers paint the sands red. As such, gladiators often received training and medical care, if they lived.
Unfortunately, most slaves ended up in massed labor gangs that would work them to death. This was essentially how Rome got most of it's public works done and one of the reasons they needed such a large army. Someone had to put down the slave revolts.
I mean, it's pretty clear that if, instead of producing one car with a given amount of input, you produce two identical cars with the same amount of input, then your output has increased. But how does a car compare to, say, 10 tonnes of wheat, or 100 barrels of oil? Or a really fancy diamond necklace? Or 100 assault rifles? The slave society would be producing different stuff than the free society.
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@ Meklar
That assumes that the societies exist in entirely different eras and tech levels which is an entirely different argument.
edited 18th Jul '13 2:04:02 PM by Belisaurius
Right, and everyone still have to eat, wear clothes et.c.
Actually, it occurs to me that we still make much of what we once did.
For example, food harvesting.
Back then an hour of work harvesting grain meant enough for one meal. Now, an hour of work harvesting grain can feed a small town.
Back then, it took a blacksmith and his team all day to make an ingot of steel and not even particularly good steel at that. Now, if you average it out then something like five people make a small tank's worth of high grade steel every hour.
Back then, a lumberjack took an hour or two to chop down a tree. Now, a lumberjack can chop down three or four trees every hour depending on how careful he wants to be.
EDIT: m8e ninja'd me to it.
edited 18th Jul '13 2:29:08 PM by Belisaurius
@Meklar
Pray tell, how is concentrating resources at the top count as artificial. For that matter, I can count the number of civilizations that don't concentrate resources like that on my fingers and not a single one is younger than greece. Furthermore, the wealther upper class tend to invest in the lower class and improve their productivity. Additionally, it is difficult to declare luxury items as inefficient. They are no more wasteful than works of art or caring for the elderly. Economically speaking, luxury goods serve a purpose as the capital now transfers from the rich buyers to the less rich sellers. The free market is essentially self regulating with unnecessary markets collapsing and needed markets springing up. Hence the "invisible hand" as described by Adam Smith. If a market did not serve some kind of purpose, even if that purpose is not readily apparent, then that market would dry up. Furthermore, economies only exist to get people what they want and need anyway.
However, what is actually produced and sold is not what people want and need; it's what people want, need and can afford. My point is that in a slaveowning society, you have a large portion of the population (the slaves) who effectively can't afford anything except what their owners choose to provide for them, while in the meantime, the slaveowning class is rendered artificially rich and placed well into the realm of diminishing marginal utility.
edited 18th Jul '13 11:34:37 PM by Meklar
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Well ignoring all the exciting philosophy here, the main point is that societies only survive if they can compete with the societies surrounding them to the point of not-dying. Domination is not required, simply survival.
Specifically with slavery we have several issues:
a) Use of slaves displaces wage-labourers and may cause unemployment. Unless the use of slaves displaces wage-labourers to then do more exciting and better work then you have a problem. On the flip side, if you have the need for a whole of bunch of really crappy menial labour then the addition of slaves solves your labour shortage.
Example: Rome and Greece tended to use a lot of slaves. However, their incessant conquering of new land constantly necessitated more and more labour to put the land back into use (especially since the standard way of defeating enemies was to kill everyone and enslave the remainder).
But, if you look at China, the amount of slavery was pretty small. It was difficult to conquer land beyond China proper (whatever was China proper at any given time) so there was hardly ever any labour shortage, there was instead, massive employment issues. The introduction of slavery would have caused so much labour displacement as to cause rebellion and riot.
b) Productivity wise, long-term productivity increases only with non-residential investment (as modern economists would call it). Generally speaking, a high supply of slaves tended to blunt the development of industrialism because cheap labour can easily replace cheap machinery. However, there seems to be a tendency toward the development of machinery and the development of superior machinery whereas the use of cheap labour (slave or low-wage is similar) appears to slow down research.
Example: We see slave-rich Greece discarding the use of all the fancy machines they invented. The Romans were similar. But if we look at, for instance, China, during the Roman Republic was the Han Dynasty which apparently had technology all the way up to bore-drills and natural gas use.
Later on, we see that population-rich China started to lean more and more heavily on using lots of people while the Arabs became the focus of technology and science.
I am only focusing on the slavery-factor here and not on the myriad of other factors.
c) Productivity of slave labour in various industries varied. Obviously, the more menial the task then the more well suited it is to slave labour. These included large expansive public works such as wall-making, monument building, quarrying or more mundane tasks such as milling flour. One of the largest tasks was farming but farms were the source of income. The more people who were slaves working on a farm meant less landholders in your society and a concentration of wealth at the top.
Productivity of slaves in securing new farm land seems to be good at first and then problematic later (likely because someone is hoarding the land thus preventing others from using it more wisely). And in many industries, such as if you wanted an extensive irrigation network in your country then like (for instance) Song Dynasty then you needed to employ a vast national network of skilled labour (such as wheelwrights and civil engineers) and that required a large free-man base to get a good selection of people going into Imperial Academies and training properly. Slaves would never be allowed to do such a thing (hence the term liberal arts degree). And so the higher proportion of your population that is enslaved the larger the drag on your ability to source skilled labour.
Imagine it is 11th century and 20% of your population is slaves. That's 1/5 of your skill pool wiped out right there. You don't live in a vacuum. In a place like say a divided China, one provincial warlord figuring out, hey I can get more skilled labourers by wiping out slavery. That guy takes over all of China. Then he bans slavery throughout. Which is basically what happened.
d) Wealth imbalance is one of the leading causes of social fragmentation which leads to corruption (bribery of officials), production of luxury goods crafted to the rich (which may potentially become inefficient because the wealth tend to be far more irrational about spending versus utility than middle and lower classes) and poverty issues (the slaves, low-wage workers and unemployed suffer malnutrition, disease and crime). What is worse is that corruption and poverty can cause a downward spiral in society where plague outbreaks, crime and lowered bureaucratic morale due to corruption can then lead to a worsening of society due to poorer government and eventually to rebellion. The examples are basically every single empire that no longer exists today.
e) Related to wealth imbalance is taxation. Governments survive on tax revenue and slaves, once sold to the public (if captured in war like the Romans), only provide the one-time cash income. The Roman Republic and the later Empire began to rely heavily on slave-sale income (as well as war loot and land captured) to keep their economy afloat. But that only lasts in the short-term. In the long-term, slaves provide absolutely nothing to the government and historically speaking, it's always difficult to tax the rich and powerful. Loss of government revenue and loss of land (especially to agrarian economy societies, which is basically everyone before today) leads to government collapse.
edited 18th Jul '13 11:54:07 PM by breadloaf
@Belisarius
Consider the old time-travel though experiment. Take a farmer from 1800 and transport him 200 years into the future. He would not recognize the world around him, or the way farm work is being done. But take one from 500BC and transport him 2000 years into the future and aside from ploughs being made of better metal and pulled by animals, crop rotation being used and other such minor improvements, not much has changed.
@Meklar
edited 19th Jul '13 2:38:16 AM by mckitten
Well I would say that the rate of technological improvement is a lot faster back then than you tend to think but it was slower. Every generation of human beings used completely different tools, from their perspective, from the last. Technological changes tended to be between in the multiple-year range in the middle ages but if you look at developed in Tang/Song Dynasty, Eastern Roman Empire, France or Holy Roman Empire... and I mean REALLY look at the minute details, you'll see they actually upgraded their equipment and facilities all the time. What you had further back in time was actually a greater likelihood of losing technology and thus having to restart.
As for slaves you have to think about
a) What can you use slaves for that your domestic population doing it would result in less "stuff" being produced?
b) Can your economy compete with neighbours?
The idea that Adam Smith's dream of the invisible hand is a pipedream as Mc Kitten said. Any society that had a top-heavy structure quickly collapsed into rebellion and corrupt government.
While a truly invisible hand of the market is a pipedream, it is true that slavery generally can hurt a civilization and generally make things less efficient. The end of slavery during the Industrial Era and other eras in various civilizations helped to create a strong middle class and working class. Slave labor keeps finances concentrated with the wealthy few and these people have less of an incentive to create jobs and new forms of production. However, the middle class and working class are shown to be the ones who create the most new businesses and jobs (https://www.businessinsider.com/rich-people-create-jobs-2013-11)
and a smaller middle class results in a higher cost of living and debt (https://www.businessinsider.com/personal-finance/class-wealth-money-rich-poor-2019-5). This creates a less stable economy that usually becomes reliant on some kind of industry that requires menial labor without doing much expansion into other industries (see the Confederate States during the Civil War and King Cotton) instead of expanding to new technology, developing, and diversifying the economy.
Has it really been 7 years? Dang.
I've read and heard, several times, that slavery-based economies are less efficient than more modern ones, including the pseudo-slavery of manorialism, which obviously is only slightly more modern.
What are the arguments for that position? Is there some place I can go and read a calm and logical analysis of the subject?