Joined: 08-Mar-2006
Location: Paris
Online Status: Offline
Posts: 2120
QuoteReplyTopic: O'Rourke (2006) Did Da Gama matter? Posted: 04-Apr-2008 at 02:29
ORourke Kevin H. and Williamson Jeffrey G. (2006) Did Vasco da Gama matter for European markets? Testing Frederick Lanes hypotheses fifty years later, IIIS Discussion Paper, 118, 53p.
Summary: In this article, the authors argue against F. C.
Lanes traditional thesis which considered that the Portuguese
discoveries had little long-lasting effect on the European spices
markets. They show that the Portuguese route did decrease the spices
prices in 16th-century Europe. Moreover they contributed to the
creation of an integrated European market for luxury goods that did not
exist before 1500. They conclude by saying that the European consumers
were ultimately the main beneficiaries ofda Gamas voyage.
Introduction
During the 20th century, historians have significantly downplayed
the significance of the discovery of the Cape route by Da Gama, F.C.
Lane and others have considered that after a 50 years-long Portuguese
domination, the Mediterranean actors had came back to seize a
significant amount of the European spices market. So much so that in
1979, H. H. Wake had to reaffirm the significance of the Lusitanian
domination of the Asian trade during the 16th century (1). So did the discovery of the Cape route had an immediate effect on the European spice markets?
Was there or not an international commodity market integration. If there was, prices should have decreased (2).
Da Gamas second voyage was the first big commercial success the
Portuguese enjoyed in the Asian enterprise (1502-03). He came back with
1700 tons of spices, the equivalent of the Venetian annual import. So
1503 is to be considered the key transition date (4).
Why the voyages?
Lanes work is based on three hypotheses:
There was no price boom in Europe before 1498, supply shortage was
not an incentive for the Portuguese to set sail to India, the Venetian
Levant routes were able to meet the European deamand.
Spices prices did not drop after 1503, in Europe.
Prices in Europe were overall quite similar as the spices market
was well integrated at the continental level as early as the 15th
century (5,6,7).
On the contrary, the authors argue that, Lanes evidence for Venice
prices do not mirror the European reality and that it was the rise of
Lisbon that allowed the integration of the European market for luxury
products (8). To have more robust result, they will use
relative rather than nominal prices and not only for Venice, but from
the whole of Europe.
Before Gama
Nominal pepper price fell by 40% in Venice over the 15th century following a similar trend in the Middle East (9). During the same period, they rose steeply in Europe (10). A spike in pepper price in 1410-14 seems to have misled Lanes into believing that there was a downward trend (11).
The authors remark that the rise might have been caused by the
disruption of the Asian spices market due to the Chinese naval
expeditions in the region (12).
As there is no correlation between grain and pepper prices, the rise of pepper prices cannot be explain by a general inflation (13).
So pepper prices did increase in absolute terms in Europe over the 15th
century, except maybe in Venice. As the Portuguese must have been
looking at the English and Dutch market rather than at the Venetian one
the hypothesis discarded by Lane that they set sail to meet the
European demand might be valid after all (14).
After da Gama
Nominal pepper prices did not fall over the 16th century. But as it
was a period of general inflation, it turns out that the relative
pepper price did fall all over Europe during the 1500s.
These relative price trends are consistent with the
conventional view that the Portuguese discoveries opened up trade
with Asia, lowered transport costs between Europe and Asia, and thus
caused the relative price of Asian goods to fall in 16th century
Europe. They also imply that the Cape route led to an increase in
European consumer welfare and that the Portuguese had to share their
gains with the rest of Europe. Finally, note that real pepper prices
did not just fall in the immediate aftermath of the discovery of the
Cape route, but continued to fall during the latter half of the 16th
century (14).
Other spices
Pepper dominated the Portuguese imports but was not alone. Cloves,
cinnamon, ginger, nutmeg were also brought through the Cape route if
their price did not decrease, it would be possible to say that the da
Gama effect was limited to the some what peculiar case of pepper. But
the real prices of all other Asian spices fell as well after 1503 all
over Europe despite a fast rise of consumption. So pepper was not an isolated exception (18).
Integrating Europe
The authors see two reasons why it is more likely that the
Portuguese kick started the process of market integration for luxury
products in Europe and the Venetian did not:
They were much better located than the Venetian were. Lisbon is
easy to access by sea from most of the European significant market
while Venice is not.
They were more open to free trade going as far as sailing directly from Asia to the Feitoria de Flandres
(the royal commercial house in Antwerp) while the Venetian state forced
the German merchants to buy under its supervision in the Fondaco dei Tedeschi(19).
While, in the 15th century, Arabian and Venetian pepper price seem
to have moved along, the rest of Europes prices were disconnected from
Venices. Before 1503, some correlation could be observed between
Belgium, the Netherlands and England, but not in the rest of Europe (20).
On the contrary, correlation increased markedly after 1503 between
region far apart (e.g. England and Austria). The Portuguese discoveries
are certainly good candidates for the explanation of this improvement
of the European market integration. This conclusion is confirmed when
observing other Asian spices (21) (with the puzzling exceptions
of ginger and Andalusia). The Portuguese did not just bring European
and Asian markets closer together [] they also brought European
markets closer to each other.
European and Asian markets
By the end of the 15th century, the European consumed at most a fourth of the spices produced in Asia (23).
While pepper production in Malabar rose by 7 or 8% per annum, scholars
have estimated that this increase was explained by Asian rather than
European demand. The latter having only a trivial impact on Asian
prices before the late 16th century (24). The Portuguese never
managed to extract monopsony profit from Asian producers as their total
control of oceanic routes and monopoly over the producing regions
proved elusive (26).
Conclusion
The Cape route permanently altered the competitive structure of the European import trade from Asia (27).
The author estimate that the Portuguese appropriated more profit than
the Venetian did and that the European consumers were better off under
the system which saw the Portuguese and the Venetian compete rather
than under the previous equilibrium when the Venetian enjoyed a
monopoly.
As earlier historians have shown the Portuguese did not manage to draw the Venetian out of business (28).
Later on the Anglo-Dutch competition on the Cape route would further
drive down pepper price and drive up European consumption and welfare.
References
E. Ashtor (1969), Histoire des Prix et des Salaires Dans lOrient Mdival (Paris: S.E.V.P.E.N.).
E. Ashtor (1973), La dcouverte de la voie maritime aux Indes et
les prix pices, in Mlanges en lhonneur de Fernand Braudel, Volume I
(Toulouse 1973).
E. Ashtor (1976), Spice Prices in the Near East in the 15th Century, Journal of the Royal Asiatic Society 1: 26-41. Reprinted in M.N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum).
E. Ashtor (1983), Levant Trade in the Later Middle Ages (Princeton, N.J.: Princeton University Press).
R. H. Bautier (1971), The Economic Development of Medieval Europe, trans. H. Karolyi (New York: Harcourt Brace Jovanovich).
C. R. Boxer (1969), A Note on Portuguese Reactions to the Revival of the Red Sea Spice Trade and the Rise of Atjeh, 1540-1600, Journal of Southeast Asian History 10: 415- 428. Reprinted in M.N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum).
C. R. Boxer (1991), The Portuguese Seaborne Empire 1415-1825 (Carcanet; first edition 1969, London: Hutchinson).
F. Braudel (1972), The Mediterranean and the Mediterranean World in the Age of Philip II, Vol. I (London: Collins).
F. Braudel (1985), Civilization and Capitalism 15th-18th Century, Volume III: The Perspective of the World (London: Fontana). 32
F. Braudel and F. Spooner, Prices in Europe from 1450 to 1750, Chapter VII in E. E. Rich and C. H. Wilson (eds.), The Cambridge Economic History of Europe: Volume IV: The Economy of Expanding Europe in the Sixteenth and Seventeenth Centuries (Cambridge: Cambridge University Press, 1967): 374-486.
D. Bulbeck, A. Reid, L. C. Tang, and Y. Wu (1998), Southeast Asian Exports Since the 14th Century: Cloves, Pepper, Coffee and Sugar (Singapore: Institute of Southeast Asian Studies).
K. N. Chaudhuri (1985), Trade and Civilisation in the Indian Ocean: An Economic History from the Rise of Islam to 1750 (Cambridge: Cambridge University Press).
A. R. Disney (1978), Twilight of the Pepper Empire: Portuguese Trade in Southwest India in the Early Seventeenth Century (Cambridge, MA: Harvard University Press).
D. H. Fisher (1996), The Great Wave: Price Revolutions and the Rhythm of History (Oxford: Oxford University Press).
P. Friedman (2005), Spices and Late-Medieval European Ideas of Scarcity and Value, Speculum: A Journal of Medieval Studies 80 (October): 1209-27.
E. J. Hamilton (1934), American Treasure and the Price Revolution in Spain (Cambridge, Mass.: Harvard University Press).
Irwin, D.A. (1991), Mercantilism as Strategic Trade Policy: The Anglo-Dutch Rivalry for the East India Trade, Journal of Political Economy 99: 1296-1314.
W. Keller and C. H. Shiue (2004), Markets in China and Europe on the Eve of the Industrial Revolution, NBER Working Paper 10778, National Bureau of Economic Research, Cambridge, Mass. (September). 33
J. Kieniewicz (1969), The Portuguese Factory and Trade in Pepper in Malabar during the 16th Century, Indian Economic and Social History Review 6: 61-84.
F. C. Lane (1933), Venetian Shipping During the Commercial Revolution, American Historical Review 38, 2 (January): 219-239.
F. C. Lane (1940), The Mediterranean Spice Trade: Further Evidence of Its Revival in the Sixteenth Century, American Historical Review 45, 3 (April): 581-590.
F. C. Lane (1963), Recent Studies on the Economic History of Venice, Journal of Economic History 23, 3 (September): 312-334.
F. C. Lane (1968), Pepper Prices before da Gama, Journal of Economic History 28, 4 (December): 590-597.
A. H. Lybyer (1915), The Ottoman Turks and the Routes of Oriental Trade, English Historical Review XXX, CXX:577-588.
A. Maddison (2002), The World Economy: A Millennial Perspective (Paris: OECD).
V. Magalhnes-Godinho (1953), Le Repli Vnitien et gyptien et la Route du Cap, 1496- 1533, in ventail de lHistoire Vivante: Hommage B Lucien Febvre, Vol. I (Paris: Librarie Armand Colin): 283-300. Reprinted in M.N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum).
V. Magalhnes-Godinho (1969), Lconomie de LEmpire Portugais aux XVe et XVIe Sicles (Paris: SEVPEN).
F. W. Mote (2003), Imperial China 900-1800 (Cambridge: Cambridge University Press). 34
K. H. ORourke and J. G. Williamson (2002), After Columbus: Explaining Europes Overseas Trade Boom, 1500-1800, Journal of Economic History 62, 2 (June): 417- 56.
M. N. Pearson (1996), Introduction, in M.N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum).
J. R. S. Phillips (1998), The Medieval Expansion of Europe, 2nd edition (Oxford: Clarendon Press).
A. Reid (1993), Southeast Asia in the Age of Commerce 1450-1680, Volume Two: Expansion and Crisis (New Haven: Yale University Press).
J. E. T. Rogers (1866-1902), A History of Agriculture and Prices in England: From the Year after the Oxford Parliament (1259) to the Commencement of the Continental War (1793) (Oxford: Clarendon Press).
P. Rozario (2005), Zheng He and the Treasure Fleet 1405-1433 (Singapore: SNP International).
C. R. de Silva (1988), The Portuguese and the Trade in Cloves in Asia During the Sixteenth Century, in Mohd Amin Hassan and Nik Hassan Shuhaimi Nik Abd Rahman (eds.), The Eighth Conference: International Association of Historians of Asia. Selected Papers (Selangor: Universiti Kebangsaan Malaysia), pp. 251-260. Reprinted in M. N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum 1996).
C. R. de Silva (1989), The Portuguese Impact on the Production and Trade in Sri Lanka Cinnamon in Asia in the Sixteenth and Seventeenth Centuries, Indica 26 (Bombay 1989): 25-38. Reprinted in M. N. Pearson (ed.), Spices in the Indian Ocean World (Gateshead: Variorum, 1996).
P. Spufford (2003), Power and Profit: The Merchant in Medieval Europe (New York: Thames and Hudson).
N. Steensgaard (1973), The Asian Trade Revolution of the Seventeenth Century: The East India Companies and the Decline of the Caravan Trade (Chicago: University of
Chicago Press).
J. de Vries (2003), Connecting Europe and Asia: A Quantitative Analysis of the Cape-route Trade, 1497-1795, in D. O. Flynn, A. Giraldez, and R. Von Glahn (eds.), Global Connections and Monetary History, 1470-1800 (Aldershot, U.K., 2003), pp. 35-106.
C. H. H. Wake (1979), The Changing Pattern of Europes Pepper and Spice Imports, ca.1400-1700, Journal of European Economic History 8 (1979): 361-403.
H. van der Wee (1963), The Growth of the Antwerp Market and the European Economy (The Hague: Nijhoff).
J. E. Wills (1993), Maritime Asia, 1500-1800: The Interactive Emergence of European Domination, American Historical Review 98, 1 (February 1993): 83-105.
You cannot post new topics in this forum You cannot reply to topics in this forum You cannot delete your posts in this forum You cannot edit your posts in this forum You cannot create polls in this forum You cannot vote in polls in this forum