Private Trade and Monopoly Structures: The East India Companies and the Commodity Trade to Europe in the Eighteenth Century

Company-states and the creation of the global international system

“…liability was unlimited (Gaastra, 1981: 49; Stern, 2015: 21; Thomson, 1994: 32–33). In contrast, company-states were able to stay the course after individual missions failed, and adopt much longer time horizons, thanks to this stock of pooled, patient capital (Berg et al 2015; Chaudhuri, 1981; Erikson, 2014; Steensgaard, 1973). They could ride out and increasingly manipulate price swings in key commodities like spices, which could ruin a one-off expedition with all its capital invested in a single mission.…”

“…The company-states also proved superior at mitigating the principal-agent challenges entailed in long-distance trade and rule (Adams, 1996; Berg et al 2015; Carlos, 1992; Carlos and Nicholas, 1993, 1996; Blussé and Gaastra, 1981; Norton, 2015). This distinguished them from European sovereign state rivals such as the Portuguese Estado da India , which otherwise likewise enjoyed the advantages of internalized protection costs and institutional longevity.…”

“Your sister growes rich by her great trade”: Catherine Nicks's Intimate Economy

“…32 Though the EIC in many ways was the antithesis of intimate networks, the company relied directly on the intimate connections of their captains, factors, and merchants in Asia, which in turn created a situation where close personal ties were too important to be ignored. 33 With her vast experience in India and with intercontinental connections, Catherine became one of many private traders who inadvertently furthered the EIC's business, despite the company's rather strained relationship with many of them. 34 Catherine's children were integral to her networks.…”