Labor Coercion and Trade: Evidence from Colonial Indonesia

What determines the use of labor coercion? Mark Hup of Peking University studies the impact of trade on corvée labor – the payment of taxation in labor – in colonial Indonesia. To do so, he constructs a unique database on corvée usage and exports at the residency-product-year level from 1900 to 1940. The results show that trade booms, especially of labor-intensive exports, reduced corvée usage. The effect ran through laborers buying themselves out of corvée. The buy-out option enabled high-productivity laborers to self-select out of corvée without requiring stronger information-collection capabilities of the state. Through such buyouts, the fall in in-kind taxation was mirrored by a rise in monetary taxation. The opposite took place during the trade collapse of the Great Depression. While some studies find a positive relationship between trade and private labor coercion, Mark Hup argues public labor coercion follows a different logic due to the state’s encompassing interest. In this Quantitative History Lecture, Mark Hup will explain how the nature of the relationship between coercer and coerced is thus key in understanding labor coercion.