Profitability of Slave and Long-Distance Trading in Context: The Case of Eighteenth-Century France

Abstract

This article studies slave and other long-distance trades in eighteenth-century France. The data cover 238 ventures from seven French harbors between 1710 and 1780. Using the undiscounted benefit-cost ratio as a proxy for the internal rate of return, the article shows that these investments were more liquid, shorter, and more profitable than private notarized credit, without higher risk. They were safer and had a shorter duration than government bonds, without being less liquid or less profitable. The conclusion, that investment in these trades was preferable to domestic alternatives, may be explained by barriers to entry.