4.2 What impact did changing trade patterns, banking and insurance have on economic development?

Question 1

3 very important trade industries in britain

Answer 1

agriculture
shipbuilding
woolen cloth

Question 2

production and sales of woolen cloth regulated by who?

Answer 2

town guilds

Question 3

3 examples of regional specialisation of woolen cloth

Answer 3

lanc: coarse cloth
devon: hand woven cloth
york: cloth hall market towns, most production stages in hands of the few artisan manufacturers

Question 4

what is the domestic system

Answer 4

same as putting out system
subcontracting of labor to those able to carry out work from home
anyone in family could work (inc women raising children)
merchants would provide raw materials and collect the finished product to sell at market
important supplement to rural work (eg: carried out during winter when long nights and little crops to sell)

Question 5

post 1660 what happened to value and production of exports (stats!)

Answer 5

1560: £600,000
1660: £1,500,000
cloth exports = 92% london exports in 1640
= 72% by 1700
value of textile exports x15 1485-1714

Question 6

when was the wool shortage and what was the result

Answer 6

1660-1835
exports of raw wool forbidden (so had to manufacture it)
imports of merino sheep from spain and wool imports from ireland

Question 7

why was there a slow growth of cotton textiles

Answer 7

uncertainty of suppliers from Levant and west Indies
hostility of wool and silk interests
especially hostile to East India Company which imported raw cotton
Prohibited imports of printed cotton goods 1700
use of printed cotton goods prohibited 1722 to protect woolen trade
(all prohibitions removed 1774)

Question 8

impact of the dutch on british cloth industry

Answer 8

woolem cloth woven then exported to holland for finishing
development of new woolen mixed fibre goods (linen, cottons, silks, worsted cloths)
-due to dutch immigrants escaping wars (vs spain then france) 1565-1680
dutch worsted cloth (improvements in combing and weaving methods)

Question 9

importance of huguenots in british cloth industr6y

Answer 9

immigration from 1681 (due to religious tolerance revoked 1685)
silk manufactures
watch makers#silver smiths
artisan weavers
based around kent and essex

Question 10

growth of london and why

Answer 10

growth =
economic hub of europe / largest city in western europe (focal point of trade, finance, insurance)
why =
population growth
influence in banking and financial services (good place to find capital investment)
legal system (inns of court)
docks, wharfs, repairs, ship building
skilled and semi-skilled workers ended up in london
base of major charter companies
important to all social classes
perfect geography and most developed transport system in the world

Question 11

examples of major charter companies based in london

Answer 11

Muscovy Co 1555
Levant Co 1581
East India Co 1600

Question 12

when, how and why did london become a hub of banking and insurance

Answer 12

eclipsed Antwerp (holland)
1571: Sir Thomas Gresham opened Royal Exchange (first commercial money market)
Bills of exchange developed
1659: first cheque by Clayton and Morris bank
relaxation of interest rates = greater lending
credit = attractive enabling joint stock ventures

Question 13

relaxation of interest rates stats

Answer 13

1571 - 1624 = 10%

1651 - 1714 = 6% or less

Question 14

Scriveners

Answer 14

money lenders (arrange it all)
born after ECW = royalists in disarray = in need of loans = scriveners take advantage, organise lending of money
eg: 1662 - 1665 Abbort saw £1,137,646 pass through his business
scriveners = guild and one of the 'Liveried Companies' est.' in middle ages
abbort established own firm = highly succesfull

Question 15

Clayton and Morris

Answer 15

took over abbots company = clayton and morris bank
issued first cheque 1659
Clayton = lonon mayor, very wealthy, loaned £30,000 to crown, director of bank of england 1702

Question 16

goldsmith bankers

Answer 16

goldsmith = worker of precious metals
deposits at royal mint raided by charles 1 in 1640 = no trust so need private banks
goldsmith bamkers = issued credit and loans with interest, became more trusted than state guarantees and securities
bills of exchange = paper money, based on trust between banks (way to exchange gold without handing over any)
goldsmith company guild 1327 = increassed reputation
crown loans from goldsmith unpaid (charles 2 defaulted on his loans) = enhanced public confidence in goldsmith banks
william fixed this in 1688 by reforming finances and national debt

Question 17

how many goldsmith banks were there in london by 1677

Answer 17

44

Question 18

marine insurance

Answer 18

covered risk of shipping
assurance courts set up 1601 to specialise in insurance law cases
dutch traders sought insurance from london brokers
became leading brokering city in world
trade increased = insurance rates declined
edward lloyd 1688 = Lloyds of London in a coffee shop
coffee shops = places where merchants, underwriters gathered in a single place
‘City Mercury’ = forerunner of financial times
CONFIDENCE

Question 19

fire insurance

Answer 19

developed 17th century europe
1627: royal exchange sets up offices to deal with insurance on ships and fires
1638: charles 1 sets up insurance scheme
1666: great fire of london
= parliament act to rebuild city
1667: provision for construction to reduce threat of fire and insurance provision for fire
1681: Friendly society for securing houses by loss through fire (quaker)
1683: coverage for risk of business premises (private dwellings covered in 1720)
CONFIDENCE