By Latifa Tohow [Edited by Charlotte Donnelly & Fatmanour Chouseinoglou]
Why were the British and Dutch more successful in establishing their overseas empires than the Spanish and Portuguese?
The Early Modern period oversaw the Age of Discovery with the voyages of Christopher Columbus in 1492 and Vasco da Gama’s discovery of the route to India, which gave the Europeans access to the New World. This was key in opening the age of global imperialism, as the Portuguese were able to use da Gama’s discovery to establish an empire in Asia, while the Spanish sent expeditions to the Americas. It was clear to see, however, that by the end of the Early Modern period the British and Dutch Empires were more successful in establishing their overseas empires, as the Spanish and Portuguese Empires’ power slowly dwindled. To understand why the British and Dutch Empires were more successful than the Spanish and Portuguese – despite the fact that the Spanish and Portuguese Empires prospered during the seventeenth century – we must look at the differences in religion, political systems and goals of the colonial states. While the British and Dutch were both Protestant states, the Spanish and Portuguese were Catholic, thus the difference in practices and beliefs is reflected by their approach in establishing their overseas empires. The difference in the political systems and goals of the colonial states also meant that the British and Dutch Empires were able to create long-lasting control of their overseas territories, unlike their Spanish and Portuguese counterparts.
The difference in religion is an important factor as to why the British and Dutch were more successful in establishing their overseas empires than the Spanish and Portuguese, as the British and Dutch Protestantism – according to Max Weber in The Protestant Ethic and the Spirit of Capitalism – allowed for the development of modern-day capitalism in these states. As Weber states, ‘the ability of mental concentration, as well as the absolutely essential feeling of obligation to one’s job, are here most often combined with a strict economy which calculates the possibility of high earnings, and a cool self-control and frugality which enormously increase performance.’[1] He links the Protestant belief in predestination and leading an inner-worldly ascetic lifestyle to modern-day capitalism. This ascetic lifestyle allowed them to systematically accumulate wealth in the most rational means possible, but as they did not spend it on luxuries, it was reinvested into their business. [2] To Weber, this is the very spirit of modern capitalism. This links back to the Dutch and British Empires as the capitalist belief in competition and mercantilism was ingrained in their institutions and shaped how they conducted their Empires.
The British and Dutch Empires for example, opted for decentralised control that allowed for institutions, that could, to adapt to changing needs, which ‘forced the development of more efficient institutions and instruments that promoted commerce and trade, and in consequence, lowered transaction costs in these economies.’[3] This allowed the British and Dutch Empires to flourish economically as they were able to lower transaction costs, which contained both the economic cost of trading and also the political cost of creating the framework which allowed this to happen. In the Dutch example, they created Fluyt; a merchant ship, that unlike its competitors was not made in a way that would allow it to be converted to a warship. This type of boat was much cheaper to build and required only a small crew. Most importantly ‘the chief innovation was the hull. It was longer and shallower than vessel […] a cost advantage that foreign imitators could not match’.[4] The instillation of capitalist values, which stemmed from the Protestant Reformation allowed the British and Dutch Empires to be more successful than their Spanish and Portuguese counterparts in establishing their overseas territories because the British and Dutch Empires were able to create the means to do so and lower the cost of governing an empire through the decentralisation of control and transportation development. On the other hand, the Spanish and Portuguese Empires were both deeply Catholic which explains why, unlike their counterparts, the spirit of modern capitalism took longer to manifest in the region, thus affecting their success as empires. To understand why the difference in religion contributed to the comparative success of the British and Dutch while disadvantaging the Spanish and Portuguese, it is important to look at how religion differs in its practice. One such difference is how salvation is achieved and this is what sparked Martin Luther to create his Ninety-five Theses, as Protestantism states that salvation could not be reached ‘through the actual accomplishing of “good works” […] that faith is man’s only way of salvation’.[5] Catholicism, however, believed that salvation could be achieved through indulgences. This difference in how salvation is achieved allowed the Protestant countries to develop capitalism for reasons mentioned by Weber. Catholicism, on the other hand, did not advocate an inner-worldly ascetic lifestyle as evident in the difference in Protestant and Catholic churches because Catholics place rituals and lavish ornaments to show their devotion. This reflects on how the Spanish and Portuguese were driven to expand their empire on the basis of spreading their religion rather than mercantilism.
As a response to the Protestant Reformation, a Catholic reformation ensued which lead to the spread of Catholicism globally in order to establish Catholicism as a powerful religion, while the empire was a way to do so. José da Acosta, a sixteenth-century Spanish Jesuit missionary and Naturalist, wrote about his time in Peru and how he used his understanding of the ‘Indian’ society to find the best way to instill Catholicism in the region. He states that to ‘set up a single norm by which to bring them under the gospel’ was impossible to do given the diversity of people in the region and then goes onto describe the three classes and how to convert each class to Catholicism. [6] This shows the focus on spreading Catholicism globally and saw colonies as a way to convert the indigenous population to it and elevate the status of Catholicism as a global power after it received a crushing blow by the Protestant Reformation. Even though the Spanish and Portuguese were successful in spreading Catholicism, with Latin America holding nearly forty percent of the world’s total Catholic population in 2014, they were less successful than their British and Dutch counterparts in establishing an overseas empire.[7] This is because the Spanish and Portuguese failed to lower the transaction cost as they ‘lagged behind, stifling initiatives that would have induced increased productivity, and Spain and Portugal pursued a downward path that would continue for centuries.’[8] This put them at a disadvantage in establishing overseas empires, while the British and Dutch were able to expand more efficiently and at a lower cost.
Moreover, the difference in the systems of control over their overseas empire and in their goals resulted in the British and Dutch Empires being more successful in establishing their overseas empires than the Spanish and Portuguese. This is because, as mentioned before, the British and Dutch Empires were instilled with capitalist values of competition and mercantilism and thus had a decentralised form of control over their colonies, which improved efficiency in maintaining and expanding their overseas territories. The most notable form of overseas control was the East India Company and Vereenigde Oostindische Compagnie (VOC), who were two mega-corporations in control of the British and Dutch holdings in India. These companies were very successful in their ventures as the VOC was the richest company in the world by 1669 with ‘150+ merchant ships, 40 warships, a private army of 10,000 armies […] paid a dividend of 40% of the original investment’.[9] The British East India Company held a significant amount of power in parliament as they believed that the world trade and wealth were fixed and thus to expand their own wealth would be at the expense of other states. The East India Company saw the Dutch as fierce competitors, recording that ‘in 1623, the Dutch used force to drive the English from Amboyna, one of the most important clove-producing islands in the Orient.
During the 1620s alone, Dutch hostility cost the Company more than two million pounds in goods.’[10] Thus, the East India Company pushed Charles II’s Government towards anti-Dutch polices like the Navigation Acts. In this case, the purpose of war and expanding territories was not only establishing the power status of the nation, but equally to expand its trade and thus increase its profit. This is incredibly important in establishing overseas empires because more resources meant that the British had better capabilities to maintain control in the region. In contrast, the Spanish and Portuguese goals were extracting gold and silver from the Americas and, most importantly, elevating the status of the country as a powerful one. This is evident in how they chose to administer their colonials through Viceroyalties. This form of government was highly centralised and ruled through bureaucratic decree. This was because both Spain and Portugal were centralised monarchies and thus ‘in order to control the economies and polities, and their overseas empires, they developed large, centralized bureaucracies.’[11] This was problematic as it did not allow for flexibility, unlike the decentralised methods used by the British and Dutch. This flexibility and the pursuit of profit rather than revenue is what made the British and Dutch systems of control more successful in expanding their overseas empires.
Overall, it is clear to see that the main reason why the British and Dutch were more successful in establishing their overseas empires than the Spanish and Portuguese was the difference in religion which resulted in the difference of goals and values that shaped each empire. Even though it had achieved its goal of spreading Catholicism, it was evident that by the end of the Early Modern period the British and Dutch Empires were better established in their overseas territories, consequently overtaking the Spanish monopoly on world trade. Notes [1] Max Weber, The Protestant Ethic and the "Spirit" of Capitalism and Other Writings (Penguin, 2002), p. 26. [2] Inner-worldly asceticism is a phrased coined by Weber which refers to reaching salvation through the means of everyday life for example, occupational work rather than spiritual work. [3] Douglass Cecil North, “Institutions, Transaction Costs, and the Rise of Merchant Empires” in J. D. Tracy (ed.), The Political Economy of Merchant Empires: State Power and World Trade, 1350–1750 (Cambridge University Press, 1991), pp. 26-27. [4] Jan De Vries, The Economy of Europe in an Age of Crisis, 1600–1750 (Cambridge University Press, 1976), p. 117. [5] Annette Deschner, John Donne and the Protestant Reformation: New Perspectives (Wayne State University Press, 2003), p. 320. [6] José de Acosta, De procuranda Indorum salute (On Gaining the Salvation of the Indians): An English translation, in G. Stewart McIntosh (ed.), 2/1 (1995), p. 3. [7] Religion in Latin America, “Widespread Change in a Historically Catholic Region”, Pew Research Centre <https://www.pewforum.org/2014/11/13/religion-in-latin-america/> [accessed 30/02/2020]. [8] Douglass Cecil North, “Institutions, Transaction Costs, and the Rise of Merchant Empires”, p. 27. [9] Will Slatyer, “The Dutch Republic and Dutch East India Company, 1602-1750”, Life/Death Rhythms of Capitalist Regimes – Debt Before Dishonour, first ed. (Partridge Publishing, 2014). [10] Arnold Sherman, “Pressure from Leadenhall: The East India Company Lobby, 1660-1678”, The Business History Review, 50/3 (The Business History Review, 1976), p. 333. [11] Douglass Cecil North, ‘Institutions, Transaction Costs, and the Rise of Merchant Empires’, p. 26.
Bibliography
de Acosta, José. De procuranda Indorum salute (On Gaining the Salvation of the Indians): An English translation, in G. Stewart McIntosh (ed.), 2/1, 1995
Deschner, Annette. John Donne and the Protestant Reformation: New Perspectives. Wayne State University Press, 2003
De Vries, Jan. The Economy of Europe in an Age of Crisis, 1600–1750. Cambridge University Press, 1976
North, Douglass Cecil. ‘Institutions, Transaction Costs, and the Rise of Merchant Empires’ in J. D. Tracy (ed.), The Political Economy of Merchant Empires: State Power and World Trade, 1350–1750. Cambridge University Press, 1991), pp. 26-27
Religion in Latin America. ‘Widespread Change in a Historically Catholic Region’, Pew Research Center, <https://www.pewforum.org/2014/11/13/religion-in-latin-america/> [accessed 30/02/2020]
Sherman, Arnold. “Pressure from Leadenhall: The East India Company Lobby, 1660-1678”. The Business History Review. 50/3, 1976
Slatyer, Will. “The Dutch Republic and Dutch East India Company 1602-1750”. Life/Death Rhythms of Capitalist Regimes – Debt Before Dishonour. first ed. Partridge Publishing, 2014
Weber, Max. The Protestant Ethic and the "Spirit" of Capitalism and Other Writings. Penguin, 2002
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