With rising frequency we hear the claim that many Chinese exports are produced with slave labor. If true, there would be a strong case for the U.S. government to obstruct Americans’ freedom to purchase goods made in China.
But is this claim true? Economics cautions skepticism. Slaves can be low-cost workers (for producers and consumers) when used to perform rote tasks – such as picking cotton – that are easily observable by supervisors. But these are also the sorts of tasks that are most easily mechanized. In our capital-rich age, the cost of using human slaves to perform such tasks must be lower than is the cost of having these tasks done with machines. Complicated tasks that require worker discretion and judgment, and that involve difficult-to-observe deployments of specialized skills, are highly unlikely to be performed at lowest cost by slaves.
And then there’s the question of “What is a slave?” Working at wages far below those that today prevail in the United States is not a sufficient condition for workers to be classified as slaves. Nor are workers slaves just because they live in a country in which the government is under the control of communist thugs (as, of course, China is). These considerations, along with several others, are necessary to take seriously into account when confronted with the assertion that Americans’ freedom to purchase goods from China should be curtailed because some, many, or most Chinese workers are slaves.
I asked some informed and trusted friends if they know of any research that attempts to empirically measure the portion of Chinese exports, or the value-added of Chinese exports, that are made with workers plausibly classified as slaves. None of my friends know of any such research; many noted – quite correctly – that the data necessary for any such credible studies would be extraordinarily difficult to obtain.
But Scott Lincicome, in answering my query, sent me the e-mail that I paste below (with Scott’s kind permission:
Hi Don,
I don’t know of a study that seriously attempts to measure this and agree it’d be useful. That said, the US has long had a law banning the importation of goods made from “forced labor” (a definition broader than true slave labor) and in fact made that law even stricter in 2015. We also now have a new law, as well as new sanctions, targeting China and requiring companies to map their supply chains and ensure they don’t contain materials originating in Xinjiang. The new law has been invoked a good bit in recent years, and has attracted some criticism for being too onerous, not too lenient. (Companies bear the burden of proof that their supply chains are compliant, and allegations can come from almost anywhere.) And yet, this is still just a tiny fraction of all US-China trade. Europe now has a similar system.
So, while the CCP is of course terrible, the claim that all or most imports from China come from slave labor just doesn’t mesh with reality.
SL
