By Regina Grafe
London School of Economics Working Paper, 2003
Introduction: This paper analyses the transformation of two of the staple trades of the pre-modern international economy – those in wool and dried codfish – during the transition from the late medieval to the early-modern economy. The first section summarises the structure and importance of the wool and dried codfish trades at the beginning of the 16th century. In the second part the paper presents new evidence showing a substantial change in the workings of the both trades following their integration into a single triangular trade system that connected Northern Spain, England and the North American mainland after the 1630s. This section also discusses changing supply and demand conditions for these products. An interpretation of the resulting structural changes in these trades is offered in the third section. This includes alterations in a) the market structure and b) the commercialisation of the two goods and its interaction with the wider regional economies in the participating regions. This is followed by some provisional conclusions.
Two types of goods, staple foodstuffs and textiles in a broad sense dominate the history of the early stages of economic integration first within Europe and then between Europe and the wider world. Among the foodstuffs ‘colonial’, often addictive goods such as tea and coffee were the most prominent, but a few staple grains such as rice also played a large role. The second group is comprised by inputs or outputs of textile manufacturing of which raw cotton and cotton cloth are the most discussed ones. The size of many of these trades from the 18th century onwards is such that they are often analysed as if they existed independently of other commercial relations. Yet none of the major commodity trades in earlier periods can be understood without looking at one of their major limitations, namely the crucial question of return cargoes. As long as transport costs were high and monetary transfers restricted, the availability of return cargo was a serious constraint to the expansion of commodity trades. This paper focuses on how the integration of a trade in the major input into textiles in the 17th century, wool, with one of a less conspicuous staple foodstuff, cod fish, resulted in one of the earliest successful trans-Atlantic commodity trades.