CASE STUDY

SEGREGATED STREETCARS AND THE PROFIT MOTIVE

In the early 20th century, streetcars in many southern cities were segregated by race. White passengers sat in the front of the streetcars, and black passengers sat in the back. What do you suppose caused and maintained this discriminatory practice? And how was this practice viewed by the firms that ran the streetcars?

In a 1986 article in the Journal of Economic History, economic historian Jennifer Roback looked at these questions. Roback found that the -segregation of races on streetcars was the result of laws that required such segregation. Before these laws were passed, racial discrimination in seating was rare. It was far more common to segregate smokers and nonsmokers.

Moreover, the firms that ran the streetcars often opposed the laws requiring racial segregation. Providing separate seating for different races raised the firms’ costs and reduced their profit. One railroad company manager complained to the city council that, under the segregation laws, the company has to haul around a good deal of empty space.

Here is how Roback describes the situation in one southern city:

The railroad company did not initiate the segregation policy and was not at all eager to abide by it. State legislation, public agitation, and a threat to arrest the president of the railroad were all required to induce them to separate the races on their cars.There is no indication that the management was motivated by belief in civil rights or racial equality. The evidence indicates their primary  motives were economic; separation was costly.Officials of the company mayor may not have disliked  blacks, but they were not willing to forgo the profits necessary to indulge such prejudice.

The story of southern streetcars illustrates a general lesson: Business owners are usually more interested III making profit than in discriminating against a particular group. When firms engage in discriminatory practices, the ultimate source of the discrimination often lies not with the firms themselves but elsewhere. In this particular case, the streetcar companies segregated whites and blacks because discriminatory laws, which the companies opposed, required them to do so.