To what extent was commercial revolution an essential pre-requisite for industrial revolution in Britain?

Industrial revolution was the transition to new manufacturing processes in the period from about 1760`s  to sometimes between 1820`s. This transition included going from hand production method to machines, new chemical manufacturing and iron production processes, improved efficiencies of water power, increase use of steam power and the development of machine tools. Landes (1969:40)

Commercial revolution, refer to the great increase in commerce, in Europe that began in the late middle age. It was a period of  European expansion, colonialism and merchantalism.it was succeeded in the mid-18^th century  by the industrial revolution. However the European economic system had begun to change in the 14^th century, partially as a result of  the black death and crusade. Beginning with crusades, European`s rediscovered spices, silks and other commodity rare in Europe. European nation through voyages  were looking for new trade in the 15<sup>th</sup> c and 16<sup>th</sup> c which helped to build international trade networks. The commercial revolution is marked by increase in general commerce and in the growth of financial services such as banks, insurance and investment. Cunningham (1892:12). Black death led to  under population  which affected the system of agriculture, the manorial land was sold  and such sell attracted the bourgeois (from  French word referring to the dominant class, emerging with commerce) who wanted to buy land,  former common land were fenced (enclosure) and increased the efficiency of rising livestock (mainly sheep`s wool for the textile industry). The progress of industry and the development of  commerce are so closely interwoven and mutually influence each other in so many ways (Mantoux (1961:91)

The following are the contributions of commercial revolution to industrial revolution in Britain and through these, are seen as pre-requisite.

Britain transformation from an economic backwater into Europe`s leading economy with sophisticated commercial and financial institution and a large manufacturing sector occurred during mercantile era of growing long distance trade. Two important issues have long attracted, trade developed in the context of mercantilist imperial regulation, conflict and warfare among European empires. Secondly, Britain`s-and more widely, Europe`s-growing trade was intertwined  with imperialism. In the New world the conquerors displaced indigenous societies and enslaved the population to exploit the mines. Success in war and imperial exploitation were keys to Europe`s economic success. For example, in 18^th c imperial war Britain adopted blue water strategy that exploited its island. Shipping and commerce were central to the strategy’s success. Merchant shipping provided man power for war time fleets. By financing their imports, by selling food, raw material and commercial services to the staple exporting colonies they allowed Britain to expand export of manufactured goods rather than the traditional woolen textile to a much greater extent that would have been possible with only bilateral trade. Also slave trade and the sugar plantation yielded great profit that played a key role in the mobilization of capital for Britain’s industrial revolution. Harley (2004)

Also commercial revolution led to the development of towns (urbanization), the financial development that produced Lombard street which was the street of banks including the bank of England, private bank, joint stock bank and discount houses sheltered once innovative of England decentralized regional banking system. As Nishimura (1971:45) quoted in Quinn (2004) London was also where banks that needed cash sold bills of exchange. In addition to commercial banks London had discount houses whose sole form of lending was discounting bill of exchange were held by London discount houses. Also London acted as the hub that integrated the region into large financial system also place to sell bill of exchange because the money market was so deep. Collin (1988:151-3) in Quinn (2004) the robust competition meant provincial banks, along with commercial and industrial concerns could rely on being able to sell a ‘good’ bill in London.

Also contributed to the development of technology in terms of payment, in early modern Europe the most advanced ways of paying for things were coins, bills of exchange and bank transfer. These three ways of paying formed the technological frontier of the early modern payment system, and in Britain, before 1688 only London offered all three. From 1688 -1873 Britain decreased both the cost and risk of making payment through innovations like bank notes, clearing house and branch banking. The innovation by transfer by endorsement diffused across mercantile Europe and jumped from local payment called the bill of exchange.  Bill of exchange order’s someone in a distant location to pay a specified sum in the local currency. The risk of bill was that the acceptor would fail to accept the bill, so innovation focused on ensuring the credibility of acceptance. Penalties, multi-signature .Banks were an innovation in lending because most 18^th c lending was book credit extended to purchasers. In 18^th c the west riding textile industry provide an example of the chain of credit that financed most industries. The textile manufactured could purchase wool directly from the farmer for the manufacturing of textile industries. Quinn (2004:151-9)

Furthermore, it contributed to the development in transport which enabled the producer to increase the extent of his market at will, without other limits than those of the inhabited world. Through technical improvements solved the difficult of communication, production was confined to the known of its habitual. Mantoux (1961:91)

Development of external market, this seemed to have brought heavier import (raw materials) and export which spread and circulated everywhere and increased quality of commodities. Industries were now receiving a sufficient provision needed by their growing population where by commodities supplied corn to Manchester which no longer run any risk of shortage. For example until the mid of the 18^th c merchants warehoused and exported Birmingham goods, now Spanish or Russia firms ordered what they wanted directly from Birmgham. . Mantoux (1961:129)

Foundation of wealth needed for the industrial revolution. Economic prosperity financed new forms of technological, social-economic and cultural expression. Whitman (1975:107)

Conclusion, Britain early modern economic growth intertwined with an international economy that was undergoing epochal change. Expanding foreign trade accompanied the increasing sophistication of the British economy in the centuries before the industrial revolution. Furthermore, the rapid growth of the industries that transformed the British economy and its society in the early nineteenth century in response to the new technologies of the industrial revolution owed much to export market.

REFERENCE

Cunningham. W (1892). The Growth of  English Industry and Commerce in Modern times,

University Press

Lands, D.S (1969).Unbound promethens: Industrial  Development in Western Europe from 1760

to the present, Cambridge University: New york .

Harley,  K.C ‘Trade, Discovery, Mercantalism and  Technology’  in Roderic Floud

and Paul Johnson’s, The Cambridge Economic  History of  Modern Britain,       Vol 1, London Cambridge University Press, 2004.

Mantoux. P. (1961). Industrial Revolution in the 18^th century, Methuen Co  Ltd: New york

Quinn.S, ‘Money, Finance and Capital Market’,in Roderick Floud and Paul Johnson’s, The

Cambridge Economic History of  Modern Britain, Vol 1, London: Cambridge University Press, 2004