The world history of slavery is not something we are proud of. Hundreds of thousands, if not millions of lives were lost during African slave trade only, not to count other incidents of slavery. However, it is only now that humanity has started to realize all the cruel aspects of this gruesome activity. Back in the 18th and 19th centuries, slaves were seen only as a source of income and cheap labour. They were not even considered as human beings. It is not surprising, therefore, that slave trade reached its peak during industrial revolution and is often considered as one of the reasons for British supremacy in that time period. The claim made by John Stuart Mill about the British Caribbean being the part of British home economy highlighted the significance of the Atlantic slave trade. It was once again emphasized during the Parliament hearings after the 1788 attack on the British slave trade. At that time, Parliament gathered information about “aspects of trade in Africa, the West In-dies, and Great Britain” (Eltis & Engerman, 2000, p. 123). Trade merchants were strictly against the abolition of slavery, they claimed that slavery was too important for the British economy. One of the testifiers, the owner of several Liverpool slaving ventures, James Penny, declared that '[s]hould this trade be abolished, it would not only affect the Commercial Interest, but also the Landed Property of the County of Lancaster, and more particularly the Town of Liverpool, whose fall, in that case, would be as rapid as its Rise has been astounding.' The Committee of Merchants Trading to Africa added that 'the effects of this trade to Great Britain are beneficial to an infinite Extent . . . [and] . . . there is hardly any Branch of Commerce in which this Nation is concerned that does not derive some advantage from it.' Further, 'were this country to agree that [the slave trade] shall be abolished, it would deprive us of the Benefit of fitting out annually, a great number of Ships, to a very great Detriment to our Manufacturers, and terminate in the Ruin of our British Settlements in the West Indies.'' (Eltis & Engerman, p. 123). Even though these people had direct interest in slave trade, it can’t be argued that Atlantic “triangular trade” played an important role in shaping British economy of the 18-19th centuries.
The graphic below shows the parts of Britain's economy that benefited from the slave trade.
BBC, Slave trade and the British economy
The importance of tropical crops
With rising population and urban movement, associated with factory production system, there was increased need in agricultural production. 'Although British agricultural output was rising, still, there was need for imports. “While population more than tripled in the course of the Industrial Revolution, domestic agricultural output did not even double” (Clark, 2007, p. 247). These imports, however, needed to be paid by exporting manufactured goods. It turned Britain into “the workshop of the world”. Moreover, West Indies were well-suited for the production of expensive crops, like coffee, tobacco, cotton, and most importantly – sugar, which occupied 70% of slave labour. As a result of increased profits from sugar and tobacco trade in the 18th century, export patterns changed dramatically. The share of manufactures in the exports to the Atlantic economy rose significantly in the 1700s. While in 1700, 80% of Britain’s trade relationships were with other parts of Europe, by 1800, America and Africa had captured 60% of its trade, in which three major ports of Glasgow, Liverpool and Bristol played a significant role.
Slave trade was one of the reasons for the growth of Atlantic ports, but the fact that they were involved with Atlantic economy played equally significant role. A question arises, what if there was no Atlantic slave trade? It would not stop the trade, because Britain was the source of colonial imports (because of regulations), however, without slaves, there would not have been a cheap workforce in the colonies for a very long time, and British exports to the America would have grown much more slowly.
The role of the trade in navigation
The Royal Navy and United kingdom’s merchant navy’s have benefited from slave trade, which supported their growth. The period of conflict for control of colonies was important for the Royal Navy’s growth. Despite the fact that Britain was dominating the Caribbean, the Navy still was not capable of protecting colonies and British sea transportation alone, it still needed help.
The Atlantic economy in 1700s
Trade in slaves and plantation crops and rising exports to American and Caribbean colonies contributed to the growth of sea transportation. According to Navigation Acts rules, which were used for overseas trade, only British ships, run by British seamen should have been used in commodity trade between British and European ports. With the newly introduced laws, British shipping companies took a lead over foreign ones: Import of sugar to North America was prohibited by the Molasses Act (1733) and British had the right to transport goods directly to Europe by the Direct Export Act (1739). This helped in building trading links between Europe, Africa and America. The triangular trade route was the most famous:
- slaves were exchanged for the British goods (like guns or brandy)
- slaves were then sold in the North America and West indies.
- Sugar, tobacco and some other commodities were shipped to Britain for sale.
Slave trade supplied experienced crews to the British merchants and the Royal Navy. However, the diseases caused the high death rate, turning slave trade into a graveyard for seamen.
The year 1750 was important for British people, as new industry - the production of cotton cloth appeared. Before that, wool production held the major place in British industry, but compared to cotton fibres, it was more difficult to process wool using machinery. It was because of this that the industrial revolution started in cotton manufacturing – in Manchester and surrounding areas, to be more precise. Britain imported cotton from slave plantations, and slavery also played important role in industrial change and British growth by providing raw materials.
Atlantic economy grew with the growth of exports; an example one can consider is the export of manufactured cotton to Africa. In 1700’s, the Atlantic economy was founded on slave labor and is considered to have sparkled the biggest changes in modern economic history.
One of the most important feature of industrial revolution was that the production of different products moved from home to factories, machines which were driven by water or steam power replaced working by hand, all these resulted in increased productivity of workers. And as a result, cotton was the greatest British export industry. And slave labour was what cotton industry was built on.
The procurement of raw materials and trading patterns
Cheap and accessible labour, accompanied with the boom in productivity related to the invention of new technical devices, like spinning jenny, spinning mule, and power loom, the application of water, and steam power to operate power looms, carding machines, (National Geographic, n.d.) etc, led to the increased demand and supply for raw materials. The production of manufactures increased drastically. One crucial invention is said to have played significant role in slave trade – cotton gin, which increased cotton cultivation but also raised demand for slave labour.
The raw materials, provided by the slave labour were used in the production of manufactured goods, which were sold in Europe and in the colonies and generated a huge profit. The profits made by the slave trade were used to purchase goods such as rum, sugar, coffee, tobacco – which were plantation-grown. These goods were then sold in Britain and Europe at a profit.
Atlantic slave trade had a dramatic impact on the growth of Atlantic ports – Bristol, Liverpool and Glasgow. Bristol and Liverpool were small towns back in 1700 while Glasgow had a population of only 12 000. The situation changed in 100 years. As a result of slave trade and trade in plantation-grown goods (mostly), these ports gained huge importance.
With growing of shipping industry, it took as much effort to build, fit and repair ships as to sail them. Liverpool dominated other cities and became the main shipbuilder. About half of the Britain’s long distance ships were used for trading with the Caribbean. Ship owners who were involved in slave trade usually owned plantations too. Merchants usually spent the generated profits in the ports.
Impact of profits
Profits generated by plantation owners (especially by Scottish ones) increased dramatically, which resulted in them building large houses. Money was also donated to public buildings and schools. Edward Colston was one of the merchants, who donated £100,000, generated from Triangular Trade, to the city and founded a boys’ school, which was named after him.
Slave traders generated good profits, which resulted in increased demand for goods like weapons, alcohol, textiles and pans. These products were exchanged for African slaves.
Profits generated by the slave trade were invested in British industries. These profits were also used to build canals and railways, which played significant role in connecting major production centers. (Cameron, R. 1989)
Profits made in the slave allowed for low domestic taxes. Investment was stimulated as a result. But unfortunately, slave trade lost its economic importance by the end of 18th century. It has been debated that an insignificant share of revenues from slave trade were directly invested in the industrial revolution.
Several factors played the role in the development of the British industry. First, technological changes created more efficient production methods, which were also cheaper and quicker. Secondly there were new machines, powered by water and steam. These new spinning and weaving machines minimized production costs, as a result, factories spread rapidly. Moreover, development of transportation infrastructure (canals and railways) made it easy to efficiently transport heavy goods. Furthermore, more and more factories were powered by coal, the supply of which was not seasonal. Therefore, it allowed for more manufacturing to take place.
Britain gradually transformed from agricultural economy to industrial economy with increased urbanization between 1700-1850. Agricultural changes included enclosure, mechanization, crop rotation and selective breeding, which created food surplus and was able to feed growing urban population (American imports, which used slave labour, however, were still very important). Therefore, it increased the labour force in cities, lowered wages and allowed companies to have a financial surplus for investment.
Growth of merchant banking
Merchants made profits by buying goods cheaply and then selling them at profit. However, gaining profits could take more than half a year as the merchants could not get the revenues until the goods had been transported and then sold. Merchants had to cover the costs of the voyage – including wages of sailors and the payment for the ship. This kind of voyages were risky as the ships could be lost or robbed. Moreover, merchants were responsible themselves to find selling places for their goods.
People involved in the Atlantic trade developed special skills. Moreover, different institutions were created to support the slave traders. For example, David and Alexander Barclay founded Barclays Bank, Sir Francis Baring founded Barings Bank. Besides, London gradually grew into the center of marine insurance and Lloyds of London, which is the world's leading insurance marketplace to this day, was founded in 1688. Furthermore, profits made from Atlantic slave trade could be shared to thousands of stakeholders, with the invention of joint stock companies
The South Sea Trading Company, which was established in 1711, made its investments in slave trade and plantations. Their popularity caused them to rise quickly in value, which created the first bubble in Britain, the South Sea Bubble of 1720. Upper classes enjoyed the profits made by the South Sea Trading company.
Wealth created by British slave traders
The contribution of the profits made in the slave trade to the British economy is debatable. The slave trade made it possible to become rich quickly, and many participants gained significant wealth. However, it was only the one side of the coin, because it involved significant risks and many participants suffered losses.
Some of the merchants invested their money in British industries. Investments in banks and new businesses were also common. Others mainly spent their revenues on conspicuous consumption and acquisition of real estate.
Revenues from slavery and Atlantic trade were almost equal to the invested amount of money in new industries, therefore they were crucial for hastening industrial revolution.
To fully understand how the slave trade shaped Britain, one should take into consideration the scale and scope of the impact that slavery had on the British economy. Atlantic slave trade altered the economy of Britain. By 1800, America and Africa had captured 60% of British trade and British exports had increased fourfold compared to 1700. Slave trade was the reason of prosperity of ports, like London, Bristol and Liverpool, while other ports, like Glasgow benefited from trade in tobacco. The supply of goods to slave traders led to the creation of thousands of jobs. In the British industrialization period, traders made profits by exporting British manufactures to Africa. The import of products produced by slave labour, like sugar (which became increasingly popular with decreasing prices of tea), were sources of further profits. Just like the cotton industry was the reason for major developments in chemistry and manufacturing, slave trade played crucial role in the formation of financial, commercial, legal and insurance institutions, which specialized in supporting activities related to slave trade. Slave-trade led to the creation of many new businesses, which were financed by the profits made from this activity. On the other hand, trustworthy merchants started offering bank services. Even if we forget about these developments, it should be emphasized that slave labour was the source of raw materials for British manufacturing industry, which allowed manufacturing to grow. Cotton, industry, for example, which is said to be the working horse of the Industrial Revolution, depended on imports of raw cotton from American plantations, which employed African slaves. Therefore, one might argue, that Slave trade played crucial role in the British economy and the Industrial Revolution.
- BBC. (n.d.). Slave trade and the British economy. Retrieved Nov, 16, 2020 from: https://www.bbc.co.uk/bitesize/guides/zc92xnb/revision/1
- Cameron, R. (1989). A Concise Economic History of the World.
- Clark, G. (2007). A Farewell to Alms: A Brief Economic History of the World.
- Eltis, D., & Engerman, S. (2000). The Importance of Slavery and the Slave Trade to Industrializing Britain. The Journal of Economic History, 60(1), 123-144.
- National Geographic, (n.d.). Industrial Revolution and Technology. Retrieved Nov, 16, 2020 from: https://www.nationalgeographic.org/article/industrial-revolution-and-technology/