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Published by EH.NET (June 2004)

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Johannes Postma and Victor Enthoven, editors. Riches from Atlantic Commerce: Dutch Transatlantic Trade and Shipping, 1585-1817. Leiden: Brill, 2003. xxxviii + 525 pp. ?138 or $161 (cloth), ISBN: 90-04-12562-0.

Reviewed for EH.NET by Paul M. Hohenberg, Department of Economics, Rensselaer Polytechnic Institute

It is a truism that the Golden Age of the Netherlands in the seventeenth century was built on waterborne trade. The rest of the market economy, particularly in the western provinces of Holland and Zeeland, was largely an outgrowth of shipping and commerce, whether one looks at processing industries or at finance. It is no wonder that much Dutch scholarship, in and out of the country, has focused on trade. Yet it is clear that the subject is not exhausted, as the book under review attests.

Dutch ships and traders were active over a large part of the globe, and scholars typically focus on one main region: the Far East (home of the VOC or East India Company), the Baltic, which forms the subject of a recent book by David Ormrod, the Mediterranean, and the Atlantic. Of course, there was also plenty of trade with the rest of Europe, by land, river, or coastal traffic.

The present work takes as its starting point the view that the Atlantic has been unfairly (?) downplayed and seeks to re-examine and rehabilitate the region in Dutch economic history along with the role of the Dutch in it. The comparison is mostly with the Far East and a little with the Mediterranean, while the Baltic is passed over almost completely. (Though Ormrod’s book is too recent to figure in the bibliography, his earlier publications are a more surprising omission.) The authors and editors are mainly Dutch, and the volume grew out of a symposium held in Leiden in 1996.

To anticipate, this reviewer concludes that the wealth of information gathered and discussed here, however welcome, is not matched by an equally strong argument. The consensus in this multi-authored volume seems to be that even after the Golden Age had tarnished, Dutch commerce in the Atlantic remained substantial and, indeed, grew through much of the eighteenth century. Yet beyond their respectable, if still secondary, quantitative role, amply documented here, I think a case can be made that the Dutch were highly instrumental in beginning the shift of the Western world-economy from one trading system to another. In a nutshell, the Dutch undermined mercantilism and anticipated open trade, even if it was more out of necessity than out of conviction. It would, indeed, be instructive to go over Adam Smith closely to see whether he held them up as exemplars, as he might well have done.

This is a big book, and one replete with documentation, from pictures and maps to tables and graphs. There are also appendices, notes on units, etc., and many footnotes along with the usual scholarly apparatus. The fourteen chapters range from broad surveys to narrower topics, such as the career of a single New York merchant of Dutch birth and, apparently, outlook. Some repetition is perhaps unavoidable. The mass of data, particularly on ships and voyages, is impressive or daunting, according to one’s point of view, and richer for the eighteenth century than for the earlier period, despite the fact that Dutch trade lost (at least relative) importance by 1700.

Much of the book is devoted to attempts to get a better grasp on these data. Here the complexity of the subject becomes clear. To begin with, the records, while abundant, are not systematic or complete. Moreover, there is very likely a bias in favor of the more “legal,” official, or sanctioned ventures, and corresponding underreporting of those that contravened laws, treaties, regulations, and established monopolies. In terms of the argument hinted at earlier, I view this potential distortion as significant. But data aside, how does one measure the “importance” of trade? One can count ships (the most often preserved records), but size matters too. In addition, vessels in the Atlantic run could make more frequent voyages than if bound for the East Indies, but fewer than in European waters. Cargoes were of unequal value, and the profit margin surely much higher for some than for others. Even the basic question that motivates the book is far from unambiguous, namely nationality. The owners, financial backers, flag, crews, and cargoes of a vessel need not be of a single nation. Finally, it is hard to extrapolate data from a given time period to one even just a few years distant, mainly because wars, treaties, and alliances, as well as mercantilist trade restrictions, could generate, snuff out, or shift trading currents quickly.

In principle, the Dutch Atlantic trade, like others in its time, operated by means of a trading company with more or less clear-cut monopoly privileges, in this case the WIC or Dutch West India Company. However, this body never fulfilled expectations, and its problems are symptomatic of the larger experience of the Dutch in the Atlantic: not that they failed but that mercantilism was not their natural trading environment. The accepted strategy of establishing colonies and controlling a lucrative trade to and from them never really worked for the Dutch in the Atlantic, at least not for long. Major places such as Brazil and marginal ones such as New Netherlands (before it became New York) soon passed into stronger hands. The Wild Coast of Surinam the Dutch kept, but at a high cost and little profit. Rather, it was in occasional and opportunistic kinds of ventures, ranging from the entrepot trade (mainly based in Cura?ao) to the capture of some other power’s ships or a quick foray into its protected colonies that the Dutch found their comparative advantage. The nation lacked the size and perhaps the political centralization of the major colonial powers (of which the smallest, England, matched the Dutch in their strategic focus on the sea), and so could at best skirmish with the Portuguese for dominance of the second tier. But they could and did take advantage of the contradictions and opportunities inherent in mercantilist doctrine and practice, as well as of those opened up by war, diplomacy, and geography — the vast areas beyond the reach of effective power or control from the metropolis.

Thus, in a long-run and global context, the real achievement of Dutch traders was not the sugar and tobacco and a thousand other goods (salt, indigo, coffee, hides, metals, …) they carried and dealt. Nor was it the slave trade, where they were minor though not reluctant players. Instead, and I wish the authors had devoted more attention to this issue, what I believe the Dutch contributed was the opening up — slow and uneven, but real — of Atlantic commerce to forces of competition and economic efficiency, leading to the gradual unraveling of the mercantilist system. In this, by the way, they helped another group chafing under the restrictions of Britain’s Navigation Laws, the North American colonists. Adam Smith may have been the prophet of free trade, but the Dutch, too few and perhaps too “capitalistic” to play the prevailing game successfully, were the first to grope toward the practice of it. Significantly, such a challenge to monopoly and imperial control would not depend narrowly on how much trade the Dutch actually carried out, since the competitive threat could affect all trade. The economic argument is a simple one, namely that potential entry can be an effective deterrent to the full exercise of monopoly power.

I do not want to push the thesis too far. The mercantile system certainly weathered the Dutch threat, but the fact that it did not survive the upheavals of the Napoleonic wars indicates that it had been weakened. With American independence, North and South, and the end of the slave trade, everyone gradually came to adopt the model of more open trade pioneered by the Dutch. Ironically, even in the Netherlands that form was probably viewed as an inferior alternative to the East Indies (VOC) model of controlled monopoly trade! Perhaps this is why previous evaluations of Dutch Atlantic trade have reached rather pessimistic conclusions. The authors of the present book are right to reopen the question, but I do not feel they got as much mileage out of their hard work as they might have done with a little more theory to guide their thinking. Perhaps the further research they invite could include issues of prices, notably the margin between prices on one shore and the other, and whether the presence of Dutch traders contributed to its narrowing.

Johannes Postma is Professor of History (Emeritus) at Minnesota State University Mankato. Victor Enthoven teaches maritime history at the Royal Netherlands Naval College at Den Helder, Netherlands.

Paul M. Hohenberg is Professor of Economics (Emeritus) at Rensselaer Polytechnic Institute, Troy, NY. He is a former editor of the Journal of Economic History and, most recently, a contributor to a forthcoming volume in the Elsevier Handbook Series on Urban and Regional Economics.