1. The Antebellum Cotton Economy

Abstract

Chapter 6 explores the end of the niche economy. By the late nineteenth century, changes to the cotton industry meant that merchants in the Gulf South were no longer as important as they once were. Structural changes to global capitalism, including the rise of investment banking, changed the nature of credit and lending, as networks of trust, which once provided a competitive advantage for Jews and other minorities, began to lose their importance. Additional global forces also mitigated the Gulf South’s centrality in the cotton industry, as the world’s thirst for cotton pushed European powers to find cheaper places in the world to produce cotton. Localized factors were also marginalizing the Gulf South and its Jewish merchants, as floods and invasive species ravaged cotton crops and a spate of anti-Jewish violence took direct aim at the Jewish niche economy. All of this meant that, in much the same manner that Jewish merchants had once marginalized cotton factors, Jewish merchants themselves became marginalized, and their niche economy came to an end.