Although there is a perception that sharecropping was exploitative, “Evidence from around the world suggests that sharecropping is often a way for differently endowed enterprises to pool resources to mutual benefit, overcoming credit restraints and helping to manage risk.”
It can have more than a passing similarity to serfdom or indenture, and it has therefore been seen as an issue of land reform in contexts such as the Mexican Revolution. However, Nyambara states that Eurocentric historiographical devices like ‘feudalism’ or ‘slavery’ often qualified by weak prefixes like ‘semi-’ or ‘quasi-’ are not helpful in understanding the antecedents and functions of sharecropping in Africa.
After the Civil War planters had to borrow money to produce crops. Interest rates on these loans were around 15%. The indebtedness of cotton planters increased through the early 1940s, and the average plantation fell into bankruptcy about every twenty years. It is against this backdrop that owners maintained their concentrated ownership of the land.
In Reconstruction-era United States, sharecropping worked in collaboration with convict lease to re-employ former slaves in jobs similar to those performed prior to their emancipation. To avoid the worst situation of becoming convict laborers, farmers were forced to enter into extremely disadvantageous sharecrop agreements that generally left them permanently in debt to the landowner.
Sharecrop farmers were loaned a plot of land to work, and in exchange owed the owner a share of the crop at the end of the season. Farmers planted land to corn and cotton. Those who had to borrow mule and plow from the landowner paid the landowner half of each crop and were regarded as 'sharecroppers', proper. Those who owned their own mule and plow (a significant economic investment given that the mule had to be fed year-round) were called 'tenant farmers', and paid the landowner 1/3 and 1/4 of each crop, respectively. A significant class distinction was made between the two, with both being fringed by 'white trash' (sharecroppers who often moved frequently and were considered unreliable) on the lower end and yeoman farmers (those who owned their own land) on the upper.
The sharecropper was required to purchase seed, tools and fertilizer, as well as food and clothing, on credit at the plantation store. When the harvest came, the sharecrop farmer would harvest the whole crop and sell his or her portion to the planter at a fixed price. By the time all the debts owed and proceeds made were tallied up the farmer was lucky to break even. The farmer did not typically sell his share of the crop directly to the landowner, but to the nearest cotton gin. Nevertheless most farmers were uneducated and were conscious of low social standing, making it easy for them to be cheated; many were actually illiterate. The poorest farmers subsisted on almost nothing but corn, a food which is deficient in niacin, and this accounted for the high incidence of pellagra in the South.
Historically, whites made up two thirds or more of the sharecroppers in Tennessee. In Mississippi, by 1900, 36% of all white farmers were tenants or sharecroppers, while 85 percent of black farmers were. Sharecropping continued to be a significant institution in Tennessee agriculture for more than sixty years after the Civil War, peaking in importance in the early 1930s, when sharecroppers operated approximately one-third of all farm units in the state. At one point in the early 20th century, there were 5.5 million white tenants, sharecroppers, and laborers in the United States, and 3 million blacks.
The situation of landless farmers who challenged the system in the rural south as late as 1941 has been described thus: "he is at once a target subject of ridicule and vitriolic denunciation; he may even be waylaid by hooded or unhooded leaders of the community, some of whom may be public officials. If a white man persists in “causing trouble” , the night riders may pay him a visit, or the officials may haul him into court; if he is a Negro, a mob may hunt him down.”
During this time there were sharecroppers' strikes in Arkansas and the Bootheel of Missouri in the 1930's. The documentary "Oh Freedom After While" further examines the 1939 Missouri Sharecroppers' Strike.
For example, a landowner may have a sharecropper farming an irrigated hayfield. The sharecropper uses his own equipment, and covers all the costs of fuel and fertilizer. The landowner pays the irrigation district assessments and does the irrigating himself. The sharecropper cuts and bales the hay, and delivers one-third of the baled hay to the landlord's feedlot, about ten miles round trip. The sharecropper might also leave the landlord's share of the baled hay in the field, where the landlord would fetch it when he wanted hay.
Another arrangement could have the sharecropper delivering the landlord's share of the product to market, in which case the landlord would get his share in the form of the sale proceeds. In that case, the agreement should indicate the timing of the delivery to market, which can have a significant effect on the ultimate price of some crops. The market timing decision should probably be decided shortly before harvest, so that the landlord has more complete information about the area's harvest, to determine whether the crop will earn more money immediately after harvest, or whether it should be stored until the price rises. Market timing can entail storage costs as well, for some crops.
When negotiating a crop sharing arrangement, you should consider:
1. What crop(s) will the sharecropper produce? 2. Who will pay for fuel? 3. Who will pay for seed? 4. Who owns the farming equipment the sharecropper will use? 5. Who will provide weed control, or other cultivation costs related to the crop? 6. How does the landlord want to receive her share, in kind or in cash? 7. If in cash, when will the crop be delivered to market (and to what market?) 7. If in kind, where will the crop be delivered to the landlord? 8. Who will provide the labor to irrigate? 9. Who will pay the irrigation district assessments? (and on a related note, who will vote the landowner's shares at irrigation district meetings?) 10. Are there other costs related to this particular farming operation that should be allocated in the agreement?