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Source: Wikipedia.org article, adapted under https://creativecommons.org/licenses/by-sa/3.0/ license.

The safety valve theory was a theory about how to deal with unemployment which gave rise to the Homestead Act of 1862 in the United States. Given the concentration of immigrants (and population) on the Eastern coast, it was hypothesized that making free land available in the West would relieve the pressure for employment in the East. By analogy with steam pressure (= the need for work), the enactment of a free land law, it was believed, would act as a safety valve. This theory meant that if the East started filling up with immigrants, you could always go West until they reached a point where they could not move any farther.

A distinction has to be made between (1) the safety valve theory as an ideal and (2) the safety valve theory as embodied in the Homestead Act of 1862.

There is a dispute whether and to what extent the Homestead Act did or did not succeed as a safety valve in ameliorating the problem of unemployment in the East.

Opposition to giving away free land came from employers, who anticipated either a shortage of employees or conditions favorable to employees.