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The organization of Eastern merchant empires

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Author Info

  • Rei, Claudia

Abstract

In the sixteenth century, European countries engaged in long-distance trade with the East. Despite sharing the same objectives and technology, Portugal opted for a crown monopoly, England, the Netherlands, and Sweden franchised trade to private merchants, whereas in Denmark and France, king and merchants shared control. The financial condition of the crown appears to have been relevant for the monarchs' decision. I provide an economic mechanism to illuminate the historical variation in terms of the differences in relative endowments of king and merchants within each country. I also explore the implications of control allocation using archival data on labor compensation and shipping technology. Differences in the long run performance of merchant empires suggest a major impact of organization.

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Bibliographic Info

Article provided by Elsevier in its journal Explorations in Economic History.

Volume (Year): 48 (2011)
Issue (Month): 1 (January)
Pages: 116-135

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Handle: RePEc:eee:exehis:v:48:y:2011:i:1:p:116-135

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Web page: http://www.elsevier.com/locate/inca/622830

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Keywords: Organization Merchant empires Financial constraints;

References

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Citations

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Cited by:
  1. Claudia Rei, 2013. "Incentives in merchant empires: Portuguese and Dutch compensation schemes," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 7(1), pages 1-13, January.
  2. Rei, Claudia, 2011. "Incentives in Merchant Empires: Portuguese and Dutch Labor Compensation," MPRA Paper 28712, University Library of Munich, Germany.
  3. Leonor Freire Costa & Nuno Palma & Jaime Reis, 2013. "The great escape? The contribution of the empire to Portugal’s economic growth, 1500-1800," Working Papers in Economic History wp13-07, Universidad Carlos III, Departamento de Historia Económica e Instituciones.
  4. Claudia Rei, 2011. "Turning Points in Leadership: Shipping Technology in the Portuguese and Dutch Merchant Empires," Vanderbilt University Department of Economics Working Papers 1123, Vanderbilt University Department of Economics.

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