The act sought to protect white laborers by imposing a monthly tax on Chinese immigrants seeking to do business in the state of California.
The 1853 recession, characterized by low growth in the United States economy [citation needed], featured American businesses contracting by 18.4% as interest rates rose and railroad investments decreased.
[2] Many Chinese immigrants made the voyage on credit, and upon arrival in California had no choice but to accept lower wages to repay their creditors.
As a result of their lower demand for wages, and their tendency to form self-supporting communities without much support from their employers, Chinese immigrants became the preferred option of labor for many landowners.
In 1857, just a few years prior to the passage of the Anti-Coolie Act in California, Chinese workers were accepting wages between one and two dollars less than their white counterparts.