
The New Poor Law and
the Agricultural
Labor Market 209
means of doing this at minimum cost" hinges on the crucial assumption
that labor was immobile. If labor was immobile, and if laborers would
do anything to avoid entering the workhouse, it follows that farmers
could reduce wages to subsistence without fear of a reduction in the
supply of labor. In effect, farmers faced a vertical labor supply curve. If,
however, labor was mobile, then farmers' ability to reduce laborers'
income was constrained by having to offer laborers a contract that
yielded an expected utility equal to their reservation utility, determined
by wage rates in London and migration costs. Any attempt by farmers to
reduce laborers' expected utility below their reservation level would
have resulted in out-migration. The New Poor Law did not alter the
utility constraint faced by farmers and therefore did not enable them to
reduce their labor costs.
Snell's conclusion that the workhouse system enabled farmers to mini-
mize their labor costs raises another issue that he does not address. Why
didn't parishes use indoor relief as part of a cost-minimizing implicit
labor contract before 1834? The 1796 Act of Parliament that sanctioned
the granting of outdoor relief to "any industrious poor person ... in
case of temporary illness or distress" did not make the use of indoor
relief illegal. Parishes such as Southwell and Bingham substituted the
workhouse system for outdoor relief more than a decade before the
passage of the New Poor Law (Nicholls
1898:
II, 227-33). If the threat of
the workhouse reduced farmers' labor costs after 1834, it should have
done the same before 1834. The fact that the great majority of southern
agricultural parishes continued to grant outdoor relief to able-bodied
laborers until the passage of the New Poor Law suggests that farmers
believed that implicit labor contracts that included outdoor relief for
seasonally unemployed laborers were better suited to their needs than
contracts including indoor
relief.
In fact, the unpopularity of indoor relief among labor-hiring farmers
is readily explained. Implicit labor contracts including indoor relief
were cost-minimizing only if labor was immobile. Although Snell as-
sumes that labor was immobile, recent estimates of rural out-migration
rates by Williamson (1987) reveal a relatively high rate of labor mobil-
ity. From 1816 to 1851, the rate of rural out-migration ranged from
0.87% to 1.73% per annum, compared to "between 0.97 and 1.21
percent per annum in the Third World in the 1960s and 1970s" (Wil-
liamson 1987: 646). During our period of interest, 1831 to 1851,
slightly more than 2 million persons migrated out of rural England and