Labor and Economics Research Paper

Historically, labor and economic systems played an extremely important role in the life of human society and produced a significant, if not to say defining, impact on practically all spheres of life. Not surprisingly that the problem of the formation and development of different labor and economic systems was and still remains one of the most discussible questions a lot of specialists are concerned about. Obviously, different epochs and different societies have different labor and economic systems. At the same time, it is still possible to trace the historical development of the contemporary labor and economic systems and find their roots in the past. In this respect, the works concerning the development of labor and economic systems in early America is particularly noteworthy since nowadays the USA play the dominant role in the whole world and its socio-economic and political activities produce a serious impact on the world.

First of all, it should be pointed out that early America labor and economic systems were initially closely related to those of Europe, notably England since this was the country where the ruling class of American states basically originated from (Breen 1986). Moreover, for a significant period of time American States were under British control and actually were colonies deprived of many rights and opportunities and what is more important they were equally deprived of economic and political freedom. As a result, initially American colonial labor and economic systems were nothing but reflections of British one and were practically identical to the latter.

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Nonetheless, the development of the United States could not fail but to develop their own, independent labor and economic systems which principles though were not radically different from those of Europe. As a result, American labor and economic systems started to develop on the principles of capitalism, capitalist competition, and the position of the working class was respectively treated according to the principles of the dominating economic system. In such a situation, it seems as if the US should simply follow the example of the Old World and just develop capitalism in the New World.

However, it is necessary to point out that the American states had at least one very significant difference from Europe and Britain. This difference was slavery that started to prosper in the South and became the basis of the local economy and produced a serious impact on labor system within the whole territory of the US, including the North (Handlin and Handlin 1950). It should be also pointed out that the labor and economic system within the US were to a significant extent different and the difference the North and the South was simply striking because the former labor and economic systems were basically developed in the situation of rapid industrialization and fast accumulation of capital and progress of capitalist and open market relations, while the latter economic and labor systems were characterized by a decadent exploitation of salves and evident preference to agricultural development of the region, especially cotton plantations (Handlin and Handlin 1950).

In such a situation slave labor, being a basis of Southern economy, became probably the most important factor contributing to the racial discrimination which actually involved not only the oppression of political rights of enslaved African American people but also the oppression of their civil and what in that situation was even more important, economic rights and opportunities (Brown 1997). To put it more precisely, African American slaves were severely exploited without being paid and guaranteed with any social benefits, civil rights, and other rights and opportunities free Americans had. As a result, a strict racial division in economic and labor relations became obvious and slavery was one of the basic causes of a deprived position of African American in labor and economic systems of the US (Brown 1997).

Naturally, such a principal contradictions between labor and economic systems of the North and South could not remain unresolved and eventually led to the Civil War and abolition of slavery. At the same time, it is necessary to precise that the abolition of slavery was not simply a political demand of the North and a formal pretext for the Civil War but it was an economic necessity for rapidly developing industrialized North as well as for white labors in the South.

In fact the exploitation of slaves made white laborers uncompetitive since they could not compete with the labor of slaves because of its lower costs. Moreover, it was obviously economically unprofitable for Southern employers to use a relatively highly paid labor of white workers (Brown 1997). As a result, the abolition of slavery was that essential economic condition that would open new opportunities before Southern state for faster economic development and industrialization and provide new opportunities for the North to open its market for cheaper labor force due to the flow of former slaves from the South. Thus, the situation in the US should be balanced due to higher competitiveness of white workers in the South and African American in the North.

Eventually, after the victorious Civil War the Northern states and their labor and economic systems spread their impact on the territories of all states constituting the country. In other words, the capitalist industrial system of labor and economic relations started dominate in the US. However, such a shift did not really changed the position of African American workers since to a significant extent labor legislation was discriminatory in relation to this racial group that aggravated more their position which was really disadvantageous because of a dramatic gap in the professional and educational level of African American and white workers. At the same time, the Civil war did not change class division of American society which still remained to be to a certain extent juxtaposed because of the lack of the middle class which constituted not very large share of American population.

Nonetheless, the basic principles which were brought to Southern states by the Northern army turned to be quite efficient for the development of open market economy and increasing competitiveness in all fields. Moreover, even African Americans, being still deprived, had eventually got an opportunity to struggle for their rights. As a result, the contemporary economic and labor systems may be considered to be descendants of those which were established in the previous epochs.


1. Handlin, Oscar and Mary Handlin. “Origins of the Southern Labor System,” WMQ, 1950.
2. Breen, T.H. “An empire of Goods: The Anglicization of Colonial America, 1690-1776,” Journal of British Studies 25, 1986: 467-99;
3. Brown, Kathleen M. “Constructing Race: Differentiating Peoples in the Early Modern World,” WMQ, 3d Ser., 54 January 1997.


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