The paradox of slave collateral

Rajesh P. Narayanan and Jonathan Pritchett

Explorations in Economic History, 2025, vol. 97, issue C

Abstract: As mobile financial assets, slaves have high liquidation value that makes them desirable as loan collateral. The mobility of slaves also makes them insecure collateral because borrowers could sell slaves to outside buyers or move them beyond the reach of creditors. We contend that creditors balanced the opposing forces of liquidity and security in deciding whether to extend credit against slave collateral. Using an original sample of New Orleans mortgage and sales records, we find that relatively few loans were backed with slave collateral and that slave buyers paid higher interest rates for their loans.

Keywords: Slave collateral; Slave sales; Credit; Interest rates (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:exehis:v:97:y:2025:i:c:s0014498325000178

DOI: 10.1016/j.eeh.2025.101670

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