An Empirical Analysis of New Orleans Slave Auctions: 1840-1860

Auctions were legally required in New Orleans estate sales during the 1800s. Since records of slave transactions were carefully documented, we are afforded the opportunity to test whether the number of bidders increased or decreased during this period using well-developed empirical methods. Auction theory tells us that the winning bid in a private-value auction will increase if an additional bidder is added. Therefore, if the number of bidders increased between 1840 and 1860, this would suggest that westward expansion was influential in the increase in average price of slaves during the same period. If the number of bidders decreased, the only remaining argument would be that slaves were simply becoming more valuable assets. We find that the number of bidders decreased over the period, so we can argue that slaves were becoming more valuable and that the increase in price was not merely a frontier effect that could not be sustained. Our results fortify the conclusion that slavery was not going to die due to economic obsolescence, and that the Civil War was a necessity to settle the future of slavery in the United States