The Black Death and the Price of Labour

Between 1347 and 1351 something between a third and a half of Europe died. The regional variation was enormous (some villages lost almost nobody, others were abandoned and never reoccupied) but the aggregate is the sharpest demographic shock in the recorded history of the continent.

What makes it worth studying as economics rather than only as catastrophe is what it did not destroy. The land survived. So did the ploughs, the mills, the barns, the roads and the houses. A third of the people did not. That is a sudden, enormous change in the ratio of labour to everything else, and it ran the closest thing pre-modern history offers to a controlled experiment.

The price of labour moved, exactly as you would expect. English real wages roughly doubled over the following decades and did not return to their pre-plague level for something like four hundred years. Landlords who had been able to take tenants for granted found themselves competing for them. Terms softened. Labour services were commuted to cash rents. People moved, which they had not previously been free to do, because a manor short of hands would take them and ask no questions.

Governments tried to stop it. England's Statute of Labourers in 1351 fixed wages at 1346 rates, made refusing work at those rates an offence, and restricted movement between manors. It largely failed, for the reason price caps below a market-clearing rate usually fail: the party who most needs the labour has every incentive to break the cap quietly, and a landlord facing an unharvested field will pay over the odds and say nothing. Enforcement, meanwhile, fell overwhelmingly on the labourers rather than on the employers who were breaking the law to hire them. The resentment that produced long outlasted the statute and fed directly into the Peasants' Revolt thirty years later.

So far this is a tidy story: a shock, a price response, a failed intervention. Here is the part that stops it being tidy.

East of the Elbe, the same shock produced the opposite result. Landlords facing exactly the same scarcity of labour did not compete for tenants. They tightened. Movement was restricted further, obligations increased, and over the following century serfdom in eastern Europe became considerably more severe than it had been before the plague: a development historians call the second serfdom. Western serfdom was eroding; eastern serfdom was hardening; the demographic input was identical.

One cause, two opposite outcomes, means the cause was not doing the work alone. What differed was everything the shock landed on: the density of towns offering an alternative to the manor, the strength of the crown relative to the nobility, the existence of a market for grain that made large estates worth defending, and the simple question of whether a peasant who walked away had anywhere to walk to. Where exit was available, scarcity became bargaining power. Where it was not, scarcity became a reason to close the door.

This is the standard example against any explanation that runs straight from an economic fact to a social outcome, and it is why the episode is taught in economic history rather than in medical history. The mechanism is not medieval. A price cap imposed against a real shortage still produces quiet evasion, misdirected enforcement and disproportionate resentment; a shortage of labour still becomes leverage only where the people who have it can credibly leave.