The british economy between the 17th and the 19th century

The British

Economy between the 17th and 19th century

Introduction

Between the 17th and early 19th century, European countries economy rest on the mercantilism. The mercantilism is an economic theory developed during the colonial age. The mercantilism focuses on maximizing trade inside the empire and accumulation of gold and silver. It considers that “the monarch, whose power is based on the gold et and taxes, have to rest on the merchant class and promote national trade in order to create trade surplus to allow precious material acquisition” . At the heart of mercantilism is the view that maximising net exports is the best route to national prosperity. The idea that the only true measure of a country’s wealth and success was the amount of gold. If one country had more gold than another, it was necessarily better off. This idea had important consequences for economic policy between 17th and 18th century. The best way of ensuring a country’s prosperity was to make few imports and many exports, by generating a net inflow of foreign exchange and maximising the country’s gold stocks.

Those ideas were attractive to some governments. Accumulating gold was necessary to be a strong and powerful state. Countries such as Britain implemented policies that were designed to protect its traders and maximize income. For example, the Navigation Acts, which severely restricted the ability of other nations to trade with England and its colonies.

In Great Britain, mercantilism reached its peak between the 17th and the 19th century. Yet, the government control on the national economy was less important than in other European countries, due to common law and steadily growth of the Parliament power. The British mercantilism is mostly interest in controlling the domestic economy. The government protected its merchants—and kept others out—through trade barriers, regulations, and subsidies to domestic industries to maximize exports from and minimize imports to the kingdom.

British empire development

During the Age of Discovery (15th/18th century), Portugal and Spain built vast empire. Envious of the wealth accumulate by this empire, England and others powerful European countries started to establish colonies in America and Asia. After a series of wars in the

17th and 18th centuries between France and England, Great Britain is left the dominant colonial power in North America. It then became the dominant power in the Indian subcontinent.

There were altogether 72 different British military campaigns during the reign of Queen Victoria. However, the human resources to equip the British armed forces during this period did not exceed 0.8% of the population. In 1898, there were 99,000 regulars in Britain, 75,000 in India and 41,000 in the Empire. The Royal Navy needed 1,00,000 men, and the Indian native army was 148,000 strong. There were barracks and coal depots, spread all over the world. Yet the total defence budget during that year amounted to 40 million: only 2.5% of the net national product. Britain could govern so much territories without presenting a bill for her particularly high defence. To be precise, defence spending in Great Britain averaged just over 3% of net domestic product between 1870 and 1913, and was below 3% for the rest of the 19th century. Moreover, during the “Scramble for Africa” period, many of the settlements were acquired at no cost to the British taxpayer since the campaigns were conducted by mercenaries employed and paid for by the “British South African” and “De Beers”, and their shareholders. Indeed, the process of colonization had been privatized. The protection of Britain's trading routes and thus its economic prosperity guided British foreign policy and guided its military interventions during the Empire period.

In this commercial interest’s strategy, it was essential for the British to control the strategic platforms of Cape Town and Cairo. For the rest, they were ready to share the spoils of Africa with the other European powers.

The British Empire development was made for the acquisition of resources and new market. Economics interests, rather than territorial ambition, defined the young Empire development. Originally, 16th century England was a poor country. Its power was lower than the Spanish and Portuguese Kingdom. British was not missionary or colonist like Spanish and Portuguese. Thus, when British started to colonies the “new world”, they had to find interest immediately. During Elizabeth I reign, England settled trade society in Turkey, Russia and in west Indies; and explored North America, where they established colonies. The high demand in sugar leaded the merchant to Caribe and the high demand in spices and textile leaded them in Asia. The first appearance of mass consumption was due to products imported from the colonies such as tea, coffee, tobacco and sugar.

During the 17th century, British took best interest of the huge commercial potential of its new acquisitions, starting by using West Indies productions. Moreover, in 1707, the union of England and Scotland that created the Great Britain, leaded to the biggest free exchange zone of the world at this time.

In North America, the thirteen colonies, along the Atlantic coast, between the French Canada and the Spanish Florida, was strongly settled since 1733. Colons had created their cotton production since their settlement. This plantation policy was developed at a bigger scale latter during the 18th century; and leaded to the “triangular trade”. British ships left with manufactured products and exchanged them against slaves in Africa. Then slaves were transported to the West Indies and at the South of the thirteen colonies, where they will be used in exploitation. Ships came back after to Great Britain with raw material such as cotton, rum, sugar, tobacco. An import part of this products imported from the colonies was re-exported toward Europe. The new world products benefits contributed to the Empire Asian trade rise. The Great Britain prosperity, was linked to the trade of slaves until 1807. When the Empire stopped to depend from the slave trade to the benefit of other trades, become more profitable. Indeed, Great Britain started to develop its industries, at the beginning of the Industrial Revolution.

The first economic model of the British Empire was naturally mercantilism. Under Stuarts and Cromwell power, mercantilism defined the colonisation and the creation of the British Empire. Until the 19th century, the

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