Investment returns and la traite négrière: evidence from eighteenth-century France

Abstract

This paper examines la traite négrière in terms of investment behaviour and investment returns. The research focus is the investments of one armateur, François Deguer, a diversified market player in eighteenth-century France. The results provide additional evidence, in an accounting context, of the trade's profitability, either as a stand-alone business or in conjunction with other parts of maritime commerce. Specifically, the analysis indicates that slave-trade investments held the possibility of above-average returns compared with other available investment opportunities. This result reinforces the arguments of Daudin (2002a, 2002b, 2004) who proposed the analysis of slave-trade investments in terms of risk, return, liquidity and time frame. Daudin's work examines limitations of the profit calculations used in prior historical research and offers alternatives that are theoretically sound and pragmatically possible. While the results in this study are based on a case analysis, they demonstrate how the informed use of archival sources can contribute to the findings from more generalised, cross-sectional studies. As historians of the slave trade have noted, each trading voyage was unique, described as a lottery, but one which could offer potentially significant returns. Lessons can be drawn from these initial results, as we confront accounting's implication in contemporary trading practices.