IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/21536.html
   My bibliography  Save this paper

The East Indian Monopoly and the Transition from Limited Access in England, 1600-1813

Author

Listed:
  • Dan Bogart

Abstract

Many markets are limited by laws and customs enforced by political and religious authorities. North, Wallis, and Weingast (2009) argue that the transition from limited access requires a series of steps like rule of law for elites and the creation of perpetually lived organizations. This paper studies how these steps were taken in England in the case of the East Indian market. The East India Company had a legal monopoly over all trade between England and modern day India and China, but its privileges and property were far from secure. The king and parliament authorized interlopers to enter the Company’s market and forced the Company to make loans to retain its monopoly. A secure monopoly only emerged in the mid-eighteenth century when political stability and fiscal capacity increased. However, liberalization of the market had to wait several more decades. A fiscal and political partnership between the government and the Company kept its monopoly stable until a confluence of events in 1813 brought it to an end.

Suggested Citation

  • Dan Bogart, 2015. "The East Indian Monopoly and the Transition from Limited Access in England, 1600-1813," NBER Working Papers 21536, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:21536
    Note: DAE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w21536.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Daniel M. Klerman, 2005. "The Value of Judicial Independence: Evidence from Eighteenth Century England," American Law and Economics Review, Oxford University Press, vol. 7(1), pages 1-27.
    2. Wells, John & Wills, Dougals, 2000. "Revolution, Restoration, and Debt Repudiation: The Jacobite Threat to England's Institutions and Economic Growth," The Journal of Economic History, Cambridge University Press, vol. 60(02), pages 418-441, June.
    3. Dan Bogart, 2014. "Political Party Representation and Electoral Politics in England and Wales, 1690-1747," Working Papers 141510, University of California-Irvine, Department of Economics.
    4. Stasavage,David, 2003. "Public Debt and the Birth of the Democratic State," Cambridge Books, Cambridge University Press, number 9780521809672, October.
    5. Dincecco,Mark, 2013. "Political Transformations and Public Finances," Cambridge Books, Cambridge University Press, number 9781107617759.
    6. Stern, Philip J., 2011. "The Company-State: Corporate Sovereignty and the Early Modern Foundations of the British Empire in India," OUP Catalogue, Oxford University Press, number 9780195393736.
    7. North, Douglass C. & Weingast, Barry R., 1989. "Constitutions and Commitment: The Evolution of Institutions Governing Public Choice in Seventeenth-Century England," The Journal of Economic History, Cambridge University Press, vol. 49(4), pages 803-832, December.
    8. Saumitra Jha, 2015. "Financial Asset Holdings and Political Attitudes: Evidence from Revolutionary England," The Quarterly Journal of Economics, Oxford University Press, vol. 130(3), pages 1485-1545.
    9. Scott, William Robert, 1912. "Constitution and Finance of English, Scottish and Irish Joint-Stock Companies to 1720," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 1, number scott1912a.
    10. Daron Acemoglu & Simon Johnson & James Robinson, 2005. "The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth," American Economic Review, American Economic Association, vol. 95(3), pages 546-579, June.
    11. Nuala Zahedieh, 2010. "Regulation, rent‐seeking, and the Glorious Revolution in the English Atlantic economy," Economic History Review, Economic History Society, vol. 63(4), pages 865-890, November.
    12. Sussman, Nathan & Yafeh, Yishay, 2006. "Institutional Reforms, Financial Development and Sovereign Debt: Britain 1690–1790," The Journal of Economic History, Cambridge University Press, vol. 66(4), pages 906-935, December.
    13. North,Douglass C. & Wallis,John Joseph & Weingast,Barry R., 2013. "Violence and Social Orders," Cambridge Books, Cambridge University Press, number 9781107646995.
    14. Cox, Gary W., 2012. "Was the Glorious Revolution a Constitutional Watershed?," The Journal of Economic History, Cambridge University Press, vol. 72(3), pages 567-600, August.
    15. Patrick O'Brien & Trevor Griffiths & Philip Hunt, 1991. "Political components of the industrial revolution: Parliament and the English cotton textile industry, 1660-1774," Economic History Review, Economic History Society, vol. 44(3), pages 395-423, August.
    16. Scott, William Robert, 1912. "Constitution and Finance of English, Scottish and Irish Joint-Stock Companies to 1720," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 3, number scott1912c.
    17. Quinn, Stephen, 2001. "The Glorious Revolution'S Effect On English Private Finance: A Microhistory, 1680–1705," The Journal of Economic History, Cambridge University Press, vol. 61(3), pages 593-615, September.
    18. Sophia Franke & Marc Quintyn, 2014. "Doorsteps Toward Political and Economic Openness: Testing the North-Wallis-Weingast Transition Framework," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 50(4), pages 212-236.
    19. Cox, Gary W, 2011. "War, Moral Hazard, and Ministerial Responsibility: England After the Glorious Revolution," The Journal of Economic History, Cambridge University Press, vol. 71(1), pages 133-161, March.
    20. Scott, William Robert, 1912. "Constitution and Finance of English, Scottish and Irish Joint-Stock Companies to 1720," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 2, number scott1912b.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kelly, Morgan & Ó Gráda, Cormac, 2018. "Speed under Sail during the Early Industrial Revolution," CEPR Discussion Papers 12576, C.E.P.R. Discussion Papers.
    2. Gwendoline Promsopha & Antoine Vion, 2017. "Thailand's 'limited order trap' : a critical application of North, Wallis and Weingast," Post-Print hal-01612052, HAL.
    3. Morgan Kelly & Cormac Ó Gráda, 2017. "Speed under Sail, 1750–1830," Working Papers 201710, School of Economics, University College Dublin.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gregory Price & Warren Whatley, 2021. "Did profitable slave trading enable the expansion of empire?: The Asiento de Negros, the South Sea Company and the financial revolution in Great Britain," Cliometrica, Springer;Cliometric Society (Association Francaise de Cliométrie), vol. 15(3), pages 675-718, September.
    2. Giuseppe Dari-Mattiacci & Oscar Gelderblom & Joost Jonker & Enrico C. Perotti, 2017. "The Emergence of the Corporate Form," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 33(2), pages 193-236.
    3. Andrianova, Svetlana & Demetriades, Panicos & Xu, Chenggang, 2011. "Political Economy Origins of Financial Markets in Europe and Asia," World Development, Elsevier, vol. 39(5), pages 686-699, May.
    4. Chilosi, David, 2014. "Risky Institutions: Political Regimes and the Cost of Public Borrowing in Early Modern Italy," The Journal of Economic History, Cambridge University Press, vol. 74(3), pages 887-915, September.
    5. De Magalhaes, Leandro & Giovannoni, Francesco, 2022. "War and the rise of parliaments," European Economic Review, Elsevier, vol. 148(C).
    6. Geloso, Vincent J. & Salter, Alexander W., 2020. "State capacity and economic development: Causal mechanism or correlative filter?," Journal of Economic Behavior & Organization, Elsevier, vol. 170(C), pages 372-385.
    7. Timur Kuran & Jared Rubin, 2014. "The Financial Power of the Powerless: Socio-Economic Status and Interest Rates under Partial Rule of Law," Working Papers 14-22, Chapman University, Economic Science Institute.
    8. Stephen Quinn, 2008. "Securitization of Sovereign Debt: Corporations as a Sovereign Debt Restructuring Mechanism in Britain, 1694-1750," Working Papers 200701, Texas Christian University, Department of Economics.
    9. Christiaan Bochove, 2014. "External debt and commitment mechanisms: Danish borrowing in Holland, 1763–1825," Economic History Review, Economic History Society, vol. 67(3), pages 652-677, August.
    10. Dan Bogart, 2008. "Competition and Commitment: the Supply and Enforcement of Rights to Improve Roads and Rivers in England, 1600-1750," Working Papers 070817, University of California-Irvine, Department of Economics.
    11. D'Maris Coffman & Judy Z. Stephenson & Nathan Sussman, 2022. "Financing the rebuilding of the City of London after the Great Fire of 1666," Economic History Review, Economic History Society, vol. 75(4), pages 1120-1150, November.
    12. Dan Bogart, 2011. "Did the Glorious Revolution contribute to the transport revolution? Evidence from investment in roads and rivers," Economic History Review, Economic History Society, vol. 64(4), pages 1073-1112, November.
    13. Noel D., Johnson & Mark, Koyama, 2012. "Standardizing the fiscal state: cabal tax farming as an Intermediate Institution in early-modern England and France," MPRA Paper 40403, University Library of Munich, Germany.
    14. Pranab Bardhan, 2016. "State and Development: The Need for a Reappraisal of the Current Literature," Journal of Economic Literature, American Economic Association, vol. 54(3), pages 862-892, September.
    15. Vesperoni , Alberto, 2013. "War Finance and the Modern State," NEPS Working Papers 6/2013, Network of European Peace Scientists.
    16. Johnson, Noel D. & Koyama, Mark, 2017. "States and economic growth: Capacity and constraints," Explorations in Economic History, Elsevier, vol. 64(C), pages 1-20.
    17. Cox, Gary W., 2012. "Was the Glorious Revolution a Constitutional Watershed?," The Journal of Economic History, Cambridge University Press, vol. 72(3), pages 567-600, August.
    18. Dan Bogart, 2014. "Governance after the Glorious Revolution: evidence on the enforcement of property rights in Britain’s transport sector, 1690-1750," Working Papers 14024, Economic History Society.
    19. Eric Hilt, 2014. "History of American Corporate Governance: Law, Institutions, and Politics," Annual Review of Financial Economics, Annual Reviews, vol. 6(1), pages 1-21, December.
    20. Leonor Freire Costa & Maria Manuela Rocha & Paulo B. Brito, 2018. "The alchemy of gold: interest rates, money stock, and credit in eighteenth‐century Lisbon," Economic History Review, Economic History Society, vol. 71(4), pages 1147-1172, November.

    More about this item

    JEL classification:

    • N00 - Economic History - - General - - - General
    • N13 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: Pre-1913
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N73 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: Pre-1913

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:21536. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.