Abstract
This paper examines the effect of labor coercion on human capital accumulation. We use microdata from Puerto Rico, where unskilled laborers were forced to work for landowners during 1849-1874. Using variation in municipality-level suitability for coffee cultivation and international coffee prices, we estimate the response of schooling to exogenous increases in relative demand for unskilled labor in regimes with and without coercion. During the coercive regime, increased coffee prices had no effect on individuals’ literacy rates in coffee growing regions. Following the abolition of coercion in 1874, similar changes in coffee prices reduced literacy rates by 12 percent, consistent with a diminished skill premium.
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