Applying Supply and Demand Analysis The Sudanese Slave Markets Where and What is the Sudan The Republic of the Sudan is in northeastern Africa It is Africa s largest country occupying an area of 967 000 square miles about 8 of the African continent Where and What is the Sudan Where and What is the Sudan Where and What is the Sudan Very diverse population Mainly Arabs in the center Mainly various black peoples in the north and south Muslim religion in the center and north Animist and Christian religions in the south Many languages Great variety of social customs Where and What is the Sudan Where and What is the Sudan Sudan s Economy Very poor country Per capita annual income of about US 500 Main income source is oil recently discovered oil deposits are amongst the largest in the world Agricultural production also cotton peanuts sesame gum arabic some grains sugarcane coffee dates animal husbandry Some History Independence from Britain and Egypt attained in 1956 Civil war broke out almost immediately between the Arabs and southerners Brief peace Second civil war began in 1983 between central government and the Sudanese Peoples Liberation Movement Some History Peace agreement signed January 2005 Provides for a central government and a regional government for Southern Sudan After 6 years the South may choose independence by a referendum vote UN monitored ceasefire Some History The agreement addresses sharing of power land and other resources and wealth Sharia law will not apply in the mainly Christian South or the capital Khartoum Sudanese Slavery Prior to the British occupation in the late 1800 s the Arabs in the Sudan regarded enslavement of Dinka as a right Slavery was crushed by the British Sudanese Slavery In the late 1980 s the central government encouraged slavers by reopening slave markets and by providing slave raiders with weapons soldiers and transport Slaving parties typically numbered about 2000 armed men Most men in raided villages were killed Younger women and some children abducted Sudanese Slavery In the late 1980 s the market price for a slave was about US 300 By 1995 the price had fallen to about US 100 per slave by 1997 the price was about US 15 per slave By 1997 many thousands of Dinka mainly women had been enslaved Estimates of total enslaved range from 15 000 to 95 000 Sudanese Slavery Slave redeemers are foreigners who purchase slaves and then set them free The goal is to reduce the numbers enslaved Redeemers entered the market in 1999 In 1999 the market price of a slave rose to about US 50 Is redemption a sensible policy Does it reduce the number of enslaved persons Supply Demand Analysis the Late 1980 s In the slave market in the late 1980 s demand was high and supply was low causing a market price for slaves and a quantity traded Supply Demand Analysis the Late 1980 s In the slave market in the late 1980 s demand was high and supply was low causing a high market price for slaves and a low quantity traded Supply Demand Analysis the Late 1980 s Price US S1 300 High demand low supply High price low quantity traded D1 Q1 QD QS Slaves Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged entry by new slavers Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged entry by new slavers causing the market supply curve for slaves to Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged entry by new slavers causing the market supply curve for slaves to shift outward Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged entry by new slavers causing the market supply curve for slaves to shift outward As a consequence the market clearing price for slaves and the quantity traded Supply Demand Analysis About 1995 The high US 300 price made the profit per slave sold high This encouraged entry by new slavers causing the market supply curve for slaves to shift outward As a consequence the market clearing price for slaves fell and the quantity traded increased Supply Demand Analysis About 1995 Price US S1 300 Higher supply lower price higher quantity traded S2 100 D1 Q1 Q2 Slaves QD QS Supply Demand Analysis About 1997 As the number of Dinka already enslaved increased the demand for new slaves decreased That is the market demand curve shifted inwards Supply Demand Analysis About 1997 As the number of Dinka already enslaved increased the demand for new slaves decreased That is the market demand curve shifted inwards Consequently the market clearing price for a new slave and the quantity traded Supply Demand Analysis About 1997 As the number of Dinka already enslaved increased the demand for new slaves decreased That is the market demand curve shifted inwards Consequently the market clearing price for a new slave fell and the quantity traded decreased Supply Demand Analysis About 1997 Price US Lower demand lower price lower quantity traded D2 S2 100 15 D1 Q3 Q2 Slaves QD QS Supply Demand Analysis About 1997 By 1997 the number of Dinka already enslaved had become large and the new low market clearing price for a slave made the profit per new slave captured very low Unless something happens to increase the price of new slaves some slavers will exit the market and so reduce the number of raids for new slaves Supply Demand Analysis About 1999 Redeemers new buyers enter the market causing the market demand to and so causing the market price to and the quantity traded to Supply Demand Analysis About 1999 Redeemers new buyers enter the market causing the market demand to increase shift outward and so causing the market price to rise and the quantity traded to increase Supply Demand Analysis About 1999 Price US Buyer entry increases demand higher price larger quantity traded D3 D2 S2 50 15 Q3 Q4 QD QS Slaves Conclusions 1 Redemption causes higher market price for slaves higher quantity traded of slaves higher number of slave raids Supply Demand Analysis About 1999 But if a slave can now be sold for a higher price then the opportunity cost of keeping the slave is increased True or False Supply Demand Analysis About 1999 But if a slave can now be sold for a higher price then the