Definition
Indentured servitude is a historical term not typically used in modern finance. It refers to a labor contract where a person (indentured servant) would work without pay for a certain period of time in exchange for passage to a new country, debt repayment, or training. This practice was common in the 17th to 19th centuries but has since been outlawed in many countries.
Key Takeaways
- Indentured servitude is a labor system where the worker is bound by a signed or forced contract (indenture) to work for a particular employer for a fixed period of time. The contract often includes terms for passage, food, accommodation, and a modest wage.
- It was frequently used as a means for poor individuals to migrate to new colonies or countries during the 17th and 18th centuries, often in harsh conditions and with limited rights.
- Though indentured servitude is no longer practiced today, studying it provides important historical context for modern labor practices and immigration, emphasizing the need for fair labor laws and treatment of workers.
Importance
The financial term Indentured Servitude holds significant importance because it represents a historical form of debt bondage.
This arose during the 16th to the 18th centuries, predominantly in the American colonies, where people agreed to work for a set period in exchange for their passage to the New World, education, or to learn a trade.
Although geenrally considered a form of forced labor, many willingly entered into these contracts seeking opportunity.
Understanding this term can provide important insights into historical economic structures, the evolution of labor rights, and socioeconomic conditions.
Despite its abolition, the concept still finds relevance today in discussions around economic inequality and labor exploitation.
Explanation
Indentured servitude, a system of labor prominently used during the 17th to 19th centuries, served multiple purposes both economically and socially. Economically, it addressed the labor shortage problem faced by many colonies, primarily during the establishment of New World. The employment mechanism of indentured servitude included labourers or potential migrants typically binding themselves under a legally enforceable contract to certain employers for a specific term.
In return, the ‘servant’ would receive benefits such as passage over to the colonies, vocational training or farming land. This essentially acted as debt bondage where individuals surrendered their freedom temporarily in return for something of value. How indentured servitude was used largely depended on the regional demands and colonization strategies.
In American and Caribbean plantations where manpower was a pivotal requirement for economic growth, the system helped in filling labor necessities for cultivating profitable crops such as tobacco, sugar, and cotton. It thus proved instrumental in driving colonial expansion and was used as a tool for populating the colonies. In a broader sense, indentured servitude provided a ‘middle ground’, allowing those unable to afford costs associated with emigration a way to migrate and start a new life.
Although criticized for its exploitative nature, it was a critical part of the labor system until it was gradually replaced by slavery.
Examples of Indentured Servitude
Colonial America: The most significant real-world example of indentured servitude lies in the history of Colonial America during the 17th and 18th centuries. Many Europeans, particularly the Irish and English, willingly entered into contracts of indentured servitude to pay for their passage to the New World. They agreed to work for a certain number of years for their masters in exchange for food, accommodation, and a promise of freedom after the contract’s completion.
The Indian Indentured Labour system: The 19th-century colonial powers, especially Britain, transported Indian laborers to their overseas colonies in Africa, Southeast Asia, and the Caribbean under the indentured labor system. These laborers were promised employment for a fixed term in exchange for their services, however, they were subjected to harsh work conditions and often lived in poor conditions.
Present-day Migrant Labor: Indentured servitude can in some cases be seen in the modern migrant working system, especially unskilled and low-skilled workers who are constantly in debt to their employers or recruiters due to the high cost of migration, accommodations, and other job-related expenses. This form of labor is common in industries like agriculture in the United States, construction in Middle East countries, and domestic work worldwide. Note: This should not be confused with corporate indentured servitude where employees trade their freedom for job security. It isn’t exactly indentured servitude since it doesn’t involve a strict contract for a specific period in exchange for a repayable debt or expenses.
Frequently Asked Questions about Indentured Servitude
What is indentured servitude?
Indentured servitude is a system of labor prevalent in the 17th to the 19th centuries, where an individual would enter into a contract, or “indenture,” to work for a specific term of years in exchange for passage to the New World, training in a trade, or other benefits.
What is the difference between indentured servitude and slavery?
The key difference between indentured servitude and slavery is that indentured servants voluntarily entered into their agreement while slaves were forcibly brought into bondage. Additionally, indentured servitude was typically for a set period, after which the servants would become free, while slaves were considered property for life.
Were indentured servants only present in America?
No, indentured servitude was not exclusive to America. It was quite common in several colonies across the world during that era, including those in the Caribbean and India. It was a widespread system of labor during the colonial period.
What happened after an indentured servant completed his contract?
Typically, upon completion of their contract, an indentured servant would be granted “freedom dues,” a pre-negotiated term of the contract which might include land, money, a gun, clothes or food. After their service, they were considered free persons with the same rights as any other citizen.
Were children indentured servants as well?
Yes, often children became indentured servants, either as terms of legal settlements or due to poverty. These children would work until they reached adulthood, often around the age of 21.
Related Entrepreneurship Terms
- Debt Bondage
- Contractual Servitude
- Involuntary Labor
- Contracted Labor
- Indentured Labor
Sources for More Information
- Encyclopedia Britannica: A comprehensive source for information on various topics including Indentured Servitude.
- History: This site offers historical facts and context about Indentured Servitude.
- JSTOR: An online library of scholarly articles, JSTOR may have in-depth academic articles on the topic of Indentured Servitude.
- The Library of Congress: The research arm of the U.S. Congress, which is one of the world’s largest libraries, it contains a wealth of information on various topics including Indentured Servitude.
