Speaker: Mark Hup, CUHK

Time: 2024/11/22, 10:00-11:30 (Beijing Time)

Title: Labor Coercion and Trade: Evidence from Colonial Indonesia

Venue: 106 Zhonghui Building

Abstract:

What determines the use of labor coercion? This paper studies the impact of trade on corvée labor – the payment of taxation in labor – in colonial Indonesia. To do so, I construct 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, I argue public labor coercion follows a different logic due to the state's encompassing interest. The nature of the relationship between coercer and coerced is thus key in understanding labor coercion.

About the speaker:

I am a Research Assistant Professor at the Chinese University of Hong Kong’s Department of Economics. I am an applied economist specializing in economic history, public economics, and development. My main strand of research focuses on the impacts of trade shocks and state capacity on fiscal modernization, a key aspect of long-run development. Specifically, I study the transition from in-kind taxation to monetary taxation and ask how and why money-based and centralized fiscal institutions emerged. Beyond this strand of research, I also study migration, the economic consequences of coercion, and the role of monetary policy risk in financial markets.