The Impact of the English Civil War on the Economy of London, 1642–50

Ben Coates

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351887892
• Edition: 1
• Topic: History
• Subtopic: World History
• Index: History

When the English Civil War broke out, London's economy was diverse and dynamic, closely connected through commercial networks with the rest of England and with Europe, Asia and North America. As such it was uniquely vulnerable to hostile acts by supporters of the king, both those at large in the country and those within the capital. Yet despite numerous difficulties, the capital remained the economic powerhouse of the nation and was arguably the single most important element in Parliament's eventual victory. For London's wealth enabled Parliament to take up arms in 1642 and sustained it through the difficult first year and a half of the war, without which Parliament's ultimate victory would not have been possible. In this book the various sectors of London's economy are examined and compared, as the war progressed. It also looks closely at the impact of war on the major pillars of the London economy, namely London's role in external and internal trade, and manufacturing in London. The impact of the increasing burden of taxation on the capital is another key area that is studied and which yields surprising conclusions. The Civil War caused a major economic crisis in the capital, not only because of the interrelationship between its economy and that of the rest of England, but also because of its function as the hub of the social and economic networks of the kingdom and of the rest of the world. The crisis was managed, however, and one of the strengths of this study is its revelation of the means by which the city's government sought to understand and ameliorate the unique economic circumstances which afflicted it.

Chapter 1
London on the Eve of the English Civil War

In the century or so before the outbreak of the English Civil War London underwent massive changes. This is mostly clearly evident in the rapid growth of the population. The population of the City of London and Southwark more than doubled between the mid-sixteenth century and the early 1630s, rising from less than 70,000 people to about 145,000. Moreover by the early seventeenth century London had expanded beyond the boundaries of the Corporation. Westminster, which in the Middle Ages had been a separate town, had grown to form a continuous urban area with the City, and new suburbs were growing up to the east in Tower Hamlets and to the north and north west in Holborn and Finsbury.¹ At the beginning of the seventeenth century the population of London was about 200,000, it doubled in the next half century: by which time at least half of all Londoners were living in the suburbs.²

The demographic growth was fuelled by the expansion of the London economy. In the 'West End' a substantial service economy grew up around a much-increased royal court and growing numbers of noble and gentry residents.³ In the rest of the metropolis growth was fuelled by the expansion of trade, which stimulated the expansion of manufacturing. In the middle years of the sixteenth century London's overseas trade consisted predominantly of the export of undyed and unfinished cloth made in the provinces and the import of a wide range of manufactured goods. Neither exports nor imports required much processing in London. Moreover the geographical scope of London's foreign trade was small; it was largely confined to Antwerp, which meant that the shipping requirements were correspondingly limited. By 1642 the growth of the national economy led to increased foreign and domestic trade, mostly through London. There were also changes in the nature of London's trade that led to increased manufacturing in London. Foreign trade now spanned the globe, and therefore required more and bigger ships, which stimulated the shipping and ship building industries. Cloth was now generally exported dyed and fully finished, which led to the growth of the London dyeing industry. The increasing sophistication of English manufacturing meant more goods were made at home, this meant that by 1640 London imports consisted predominantly of raw materials, and London was the ideal place for the new sectors of manufacturing industry which used imported raw materials. The growth in manufacturing particularly led to a much greater level of employment in the London economy. Most of this new employment was poorly paid, which is why, as Ian Archer has observed, London society was 'filling out at the bottom', nevertheless this should not disguise the fact that this period saw a massive expansion in the economy of London.⁴

London's economy was extremely vulnerable to short-term fluctuations. Merchants were generally under-capitalized in the early stages of their careers. Even those of gentry origin had little start-up capital. Profits were low, and, because of primitive business accounting, merchants found it difficult to determine the rate of profit on their investments.⁵ Credit was ubiquitous and tradesmen were reluctant to write off bad debts, and any chain of credit was only as strong as its weakest link. Fixed capital made up a small proportion of total investments, most of which consisted of circulating goods and money. This meant that disinvestment was easy in times of economic crisis. The result was that cash flow was very important in the early modern economy and every merchant's nightmare was a wave of bankruptcies, one triggering another. These factors must have made for a very unstable business community. Many livery company pensioners were formerly wealthy and senior members.⁶

Supple has argued that in this period economic activity was not rhythmical, instead economic crisis was the result of extraneous problems, including those arising from political upheavals such as war, currency manipulation and trade stoppages. The Cockayne project and the currency manipulations of the early years of the Thirty Years' War caused severe slumps in London's exports.⁷ A further cause of economic instability was dearth in England, which depressed domestic markets.⁸

Foreign trade

The foundation of the economy of the City was its dominant position in England's internal and external trade. Unfortunately from 1604 syndicates of London financiers farmed the customs revenue for fixed annual rents. This had the advantage for the government of making the receipts from this vital source of revenue more dependable, but it had the disadvantage for the historian of making the customs accounts enrolled in the Exchequer virtually useless for measuring the level of trade. A great deal can be learnt from port books, which record foreign trade in vast detail, but they have survived only for certain years and must therefore be used cautiously for interpreting trends. An almost complete set of port books covering almost all aspects of imports and exports have survived for 1640 but this is unusual, there are none for exports by English merchants in the second half of the 1630s.⁹

Nevertheless, the major trends in London's overseas trade are evident. The seventeenth century saw a considerable expansion in England's overseas trade, which transformed the country into the greatest trading nation in Europe by the beginning of the eighteenth century. Not only did the range of imported and exported goods grow but also the geographical scope of English trade increased as merchants began to develop global commercial networks for the first time. These changes took place primarily in London and had a major impact on its economy. Many of them were already apparent by 1642, leading Fisher to argue that, 'The later years of the century saw little more than the intensification of trends already apparent before the Civil War'.¹⁰

In the sixteenth century the old draperies dominated English exports, heavy woollen cloth which was generally sold in northern Europe. They were usually exported undressed to the Netherlands to be finished. In the early sixteenth century exports of the old draperies grew very rapidly until the boom reached its peak in 1550, when over 130,000 shortcloths were exported. This was followed by a major slump and what, at first glance, appears to be a longer period of stagnation in the second half of the sixteenth century. The triennial averages of shortcloth exports published by Fisher suggest that exports never rose above about 103,000 in the Elizabethan period, and were usually below 100,000.¹¹ However Fisher's figures are misleading, he fails to take into account the fact that after 1558 one cloth in ten was exported custom free, and was consequently unrecorded. Even taking into account the non-taxable cloths the numbers of shortcloths exported from 1559 onwards were still lower than the mid-century peak but the shortcloth was a notional measure devised for fiscal purposes and can be a misleading measure of trade. The custom of 6s 8d per shortcloth was designed to compensate the crown for the loss of the traditional duty on the export of raw wool because the wool was being exported as cloth. It was therefore designed to measure the amount of English wool in the cloth, rather than its value. Cloth was therefore taxed at the same rate whether it was dyed or dressed or not, although dyeing and dressing was estimated to add 50-100 per cent to the value of the cloth. This is important for the Elizabethan period because there was a significant expansion in exports to the Baltic in the second half of the sixteenth century. London exports to the Baltic consisted predominantly of expensive finished cloths, which nevertheless paid the same custom as the undressed cloths exported to the Netherlands. By 1598 exports to the Baltic accounted for about eleven per cent of shortcloths exported from London, in value the proportion was almost certainly significantly higher. Finally, the Elizabethan period saw the beginning of the export of new draperies, a range of worsted fabrics that were lighter and more colourful than the traditional woollens and were not recorded with the shortcloths in the customs records. Although, as yet, these exports were still small, at the end of the reign of Elizabeth exports from London other than shortcloths still totalled only about £130,000.¹²

Peace with Spain in 1604 led to a boom in London's overseas trade. Exports of old draperies increased from 114,000 shortcloths annually at the end of the 1590s to over 140,000 by 1614.¹³ However the old draperies boom consisted mostly of exports of undressed shortcloths to the Dutch Republic. In the Baltic the English merchants were losing out to Dutch merchants exporting English cloth finished in Holland. In 1615 a cartel led by the governor of the Eastland Company, which controlled trade with the Baltic, persuaded the government to ban the export of unfinished cloth. The intention was to encourage dyeing and finishing in England. However the English dyeing industry was not large enough and the Dutch responded by forbidding the import of dyed English cloth. The project was soon abandoned but the interruption of English exports stimulated the textile industries of Germany and the Netherlands to expand to fill the gap. English exports lost further ground in the early years of the Thirty Years' War when currency devaluations in Germany and Poland drove up the price of English cloth, pricing them out of the market. Additionally the Dutch increased their taxes on English cloth to help pay for the renewed war with Spain in 1621. Barry Supple has argued that in the years leading up to the Civil War, the old drapery industry was clearly in decline, punctuated by severe depressions.¹⁴

In 1640 only about 87,000 taxable shortcloths were exported from London, although if the tax-free cloths are included the total was probably more like 96,000. This suggests that exports fell by about one-third between 1614 and 1640, but once again, shortcloths are a misleading measure of exports. The proportion of cloths exported undressed from London fell from nearly three-quarters in the early Jacobean period to about one-third by 1640. Consequently it is likely that the average value of the shortcloth was higher in 1640 than in 163.4.¹⁵ Moreover because the shortcloth duty was designed only to tax English wool cloth made partly from imported wool paid a lower rate. Exports of Spanish cloth, so called because it was made partly from Spanish wool, grew from nothing in the early 1620s to 13,517 cloths in 1640. Spanish cloth was a high quality fabric that cost nearly twice as much as traditional old draperi...

Table of contents

• Cover
• Half Title
• Dedication
• Title
• Copyright
• Contents
• List of Tables and Figures
• Preface
• Abbreviations and Conventions
• Introduction
• 1 London on the Eve of the English Civil War
• 2 Parliamentary Taxation and Levies
• 3 Parliamentarian Finance
• 4 Supplying Parliament's Armed Forces and Privateering
• 5 Economic Warfare
• 6 Domestic Trade and Consumer Spending
• 7 International Trade and Shipping
• 8 Manufacturing Industry
• 9 Economic Fluctuations 1642-50
• Index