Restricted Debate Retrieved 23: Cotton and the Plantation Economy

jgoodguy

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Interesting but technical article about the effect of Indian Cotton on British factories.

Econometrica, Vol. 83, No. 1 (January, 2015), 67–100
NECESSITY IS THE MOTHER OF INVENTION: INPUT SUPPLIES
AND DIRECTED TECHNICAL CHANGE
BY W. WALKER HANLON
Link

I exploit the impact of the U.S. Civil War on the British cotton textile industry, which reduced supplies of cotton from the Southern United States, forcing British producers to shift to lower-quality Indian cotton. Using detailed new data, I show that this shift induced the development of new technologies that augmented Indian cotton. As these new technologies became available, I show that the relative price of Indian/U.S. cotton rebounded to its pre-war level, despite the increased relative supply of Indian cotton. This is the first paper to establish both of these patterns empirically, lending support to the two key predictions of leading directed technical change theories.

To do so, it exploits a large exogenous shift in relative supplies to the British cotton textile industry caused by the U.S. Civil War (April 1861–April 1865). The war, which included a blockade on Southern shipping by the Union Navy, sharply increased the cost of supplying U.S. cotton from the South. The result was a sharp depression in the industry; output dropped by as much as 50% and hundreds of thousands of mill operatives found themselves out of work or working short-time. The shortage of U.S. cotton forced British producers to turn to raw cotton from alternative suppliers, chiefly India. However, the cotton available from India differed from American cotton in important ways; it was a low-quality variety that was difficult to clean and prepare for the spinning process. Thus, this event generated a sharp shift in the relative supplies of two similar, but not identical, inputs to the production process. Historians and contemporary observers have noted the important changes that took place as a result of this event. D. A. Farnie, in his authoritative history of the British cotton textile industry, wrote, “The shortage of American cotton compelled employers to re-equip their mills in order to spin Surat [Indian cotton], and especially to improve their preparatory processes. . . The reorganization of the preparatory processes entailed such an extensive investment of capital that it amounted almost to the creation of a new industry. . . ”3

The first contribution of this paper is to document the pattern of directed technical change generated by the shock to input supplies. Using detailed new patent data, I show that the Civil War time period was characterized by a sharp increase in innovation in three types of cotton textile machinery—gins, open- ers/scutchers, and carding machines—that were particularly important for ad- dressing the key bottlenecks in the use of Indian cotton. Comparing these three technology types to all other cotton spinning technologies, I document substan- tial increases in innovation in technologies related to the use of Indian cotton. Innovators reacted quickly, introducing simple improvements in technologies during the first year of the war, followed by more advanced machines in later years. Innovation in technologies related to Indian cotton peaked three years into the conflict, and remained high one to two years after the end of the war. Thus, the patent data reveal substantial directed technical change toward technologies that augmented Indian cotton.​
 

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USS ALASKA

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Oh Great - I'm reading about cotton and have to do math?

1.jpg


Geez...

Kinda reminds me of the oil refining process. Some refineries are set up for light sweet, some for heavy, others for blends. Change the feed stock that the production system was optimized for and you have to change the production system.
199

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USS ALASKA
 
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USS ALASKA

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Interestingly enough - to me at any rate - at one time prior to the ACW, India had a booming cotton industry. Unlike the Opium Wars which encouraged the Brits to introduce and raise tea in India to break the Chinese monopoly, cotton has a long history on the sub-continent...

Indian cotton threads have been found that dated to the Neolithic period. Indian cultivation is dated to the Indus Valley Civilization, between 3300 and 1300 BC. The sub-continent cotton industry was well-developed and some methods used in cotton spinning and fabrication continued to be used until the industrialization of India. Between 2000 and 1000 BC cotton became widespread across much of India. Handheld roller cotton gins had been used in India since the 6th century. Between the 12th and 14th centuries, dual-roller gins appeared. The Indian version of the dual-roller gin was prevalent throughout the Mediterranean cotton trade by the 16th century. This mechanical device could be driven by water power. The spinning wheel was invented in India, between 500 and 1000 AD.

During the Mughal Empire, Indian production of both raw cotton and cotton textiles increased. The Mughals instituted agrarian reforms such as an incentive system that was leaned in favor of high value cash crops such as cotton and indigo, providing official incentives to grow them, in addition to rising market demand. The largest manufacturing industry in the Mughal Empire was cotton textiles, which included the production of piece goods, calicos, and muslins, available unbleached and in a variety of colors. The cotton textile industry was responsible for a large part of the empire's international trade. ( this sound familiar? ) India had a 25% share of the global textile trade in the early 18th century. Indian textiles were the most important manufactured goods in world trade in the 18th century. ( this sound familiar? ) The epicenter of cotton production was the Bengal Subah province. The worm gear roller cotton gin, which was invented in India during the early Delhi Sultanate era of the 13th–14th centuries, came into use in the Mughal Empire some time around the 16th century. Another innovation, the incorporation of the crank handle in the cotton gin, first appeared in India some time during the late Delhi Sultanate or the early Mughal Empire. The production of cotton was advanced by the diffusion of the spinning wheel across India shortly before the Mughal era, lowering the costs of yarn and helping to increase demand for cotton.

And then, the EIC showed up...

The English East India Company introduced Britain to cheap calico and chintz cloth. The cheap colorful cloth proved popular and overtook the EIC's spice trade by value in the late 17th century. The EIC jumped on this, particularly for calico, by expanding its factories in Asia and producing and importing cloth in bulk, creating competition for domestic woolen and linen textile producers. The displaced weavers, spinners, dyers, shepherds and farmers objected and the calico question became one of the major issues of National politics between the 1680s and the 1730s. Parliament began to see a decline in domestic textile sales, and an increase in imported textiles from places like China and India. Seeing the East India Company and their textile importation as a threat to domestic textile businesses, Parliament passed the 1700 Calico Act, blocking the importation of cotton cloth. In 1721, dissatisfied with the results of the first act, Parliament passed a stricter addition, this time prohibiting the sale of most cottons, imported and domestic, exempting only thread Fustian and raw cotton. The exemption of raw cotton from the prohibition initially saw 2 thousand bales of cotton imported annually, to become the basis of a new indigenous industry, initially producing Fustian for the domestic market, though more importantly triggering the development of a series of mechanized spinning and weaving technologies, to process the material. The mechanized production was concentrated in new cotton mills, which slowly expanded, till by the beginning of the 1770s seven thousand bales of cotton were imported annually, and pressure was put on Parliament, by the new mill owners, to remove the prohibition on the production and sale of pure cotton cloth, since they could then easily compete with anything the EIC could import. The acts were repealed in 1774, triggering a wave of investment in mill based cotton spinning and production, doubling the demand for raw cotton within a couple of years, and doubling it again every decade, into the 1840s.

Indian cotton textiles continued to maintain a competitive advantage up until the 19th century. In order to compete with India, Britain invested in labor-saving technical progress, while implementing protectionist policies such as bans and tariffs to restrict Indian imports. At the same time, the East India Company's rule in India contributed to its deindustrialization, opening up a new market for British goods, while the capital amassed from Bengal after its 1757 conquest was used to invest in British industries such as textile manufacturing and greatly increase British wealth. British colonization also forced open the large Indian market to British goods, which could be sold in India without tariffs or duties, compared to local Indian producers who were heavily taxed, while raw cotton was imported from India without tariffs to British factories which manufactured textiles from Indian cotton, giving Britain a monopoly over India's large market and cotton resources. India served as both a significant supplier of raw goods to British manufacturers and a large captive market for British manufactured goods. Britain surpassed India as the world's leading cotton textile manufacturer.

India's cotton-processing sector changed during EIC expansion in India, in the late 18th and early 19th centuries, from focusing on supplying the British market to supplying raw cotton. As the Artisan produced textiles were no longer competitive with those produced Industrially, and Europe preferring the cheaper slave produced, long staple American, and Egyptian cottons, for its own materials.

During the ACW, cotton growing in the British Empire, especially Australia and India, greatly increased to replace the lost production of the American South. Through tariffs and other restrictions, the British government discouraged the production of cotton cloth in India; rather, the raw fiber was sent to England for processing. The Indian Mahatma Gandhi described the process:

  1. English people buy Indian cotton in the field, picked by Indian labor at seven cents a day, through an optional monopoly.
  2. This cotton is shipped on British ships, a three-week journey across the Indian Ocean, down the Red Sea, across the Mediterranean, through Gibraltar, across the Bay of Biscay and the Atlantic Ocean to London. One hundred per cent profit on this freight is regarded as small.
  3. The cotton is turned into cloth in Lancashire. You pay shilling wages instead of Indian pennies to your workers. The English worker not only has the advantage of better wages, but the steel companies of England get the profit of building the factories and machines. Wages; profits; all these are spent in England.
  4. The finished product is sent back to India at European shipping rates, once again on British ships. The captains, officers, sailors of these ships, whose wages must be paid, are English. The only Indians who profit are a few lascars who do the dirty work on the boats for a few cents a day.
  5. The cloth is finally sold back to the kings and landlords of India who got the money to buy this expensive cloth out of the poor peasants of India who worked at seven cents a day.
I always thought that Indian cotton was a 'Johnny-come-lately' to the cotton game - the things I have to unlearn...(cross-thread reference!!!) The English mills were not set up for Indian cotton - different feed stock, different process...

Sources;
"First Evidence of Cotton at Neolithic Mehrgarh, Pakistan: Analysis of Mineralized Fibres from a Copper Bead". Journal of Archaeological Science.
A History of India.
"The spread of textile production and textile crops in India beyond the Harappan zone: an aspect of the emergence of craft specialization and systematic trade"
The Columbia Encyclopedia
Historical Geography of Crop Plants: A Select Roster
The Science of Empire: Scientific Knowledge, Civilization, and Colonial Rule in India
Cotton: Origin, History, Technology, and Production. 4. John Wiley & Sons.
Technology in World Civilization: A Thousand-Year History
An Atlas and Survey of South Asian History
Monitoring the World Economy, 1820-1992
Why Europe Grew Rich and Asia Did Not: Global Economic Divergence, 1600–1850
The Rise of Islam and the Bengal Frontier, 1204-1760
Economic History of Medieval India, 1200-1500
"Machinery and Large-Scale Industry."
"Cotton textiles and the great divergence: Lancashire, India and shifting competitive advantage, 1600-1850"
Finance and Society in 21st Century China: Chinese Culture Versus Western Markets
The Islamic World: Past and Present Bengal Industries and the British Industrial Revolution (1757-1857)
The Process of Economic Development.
Economics and World History: Myths and Paradoxes.
The Definitive Glossary of British India.
"100 Years of Cotton Production, Harvesting, and Ginning Systems".
Cotton: The Biography of a Revolutionary Fiber.
276

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wausaubob

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I don't think it was slavery that made American cotton dominant. The southern transportation system was better and the southern farmers were better agronomists. And that includes the experienced African/American farmers.
The US needed to improve its soil practices. It seems as if that was just about to happen with the Civil War interrupted the process.
 

uaskme

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Brits were exploiters Of the Indians as the South were the Negro. It was just another Anglo Saxon Plot. Used to Economically exploit a Race deemed to be Inferior.

Guess 1 Plot is Better than Another?
 

Yankeedave

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This thread and y'all's posts could fall under the heading of the other thread of "what was the top technical innovations of the civil war."
 

rebelatsea

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Brits were exploiters Of the Indians as the South were the Negro. It was just another Anglo Saxon Plot. Used to Economically exploit a Race deemed to be Inferior.

Guess 1 Plot is Better than Another?
Er no, not quite. I suggest you read up on the history of India, how the country was governed, and the level of intermarriage and intermixing that occurred at all levels although officially it didn't exist, and we had crack Indian regiments in the British Army.
 

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How India fuelled slavery with the export of cotton
Arup K. Chatterjee
December 15, 2018 16:26 IST
Updated: December 16, 2018 12:44 IST

Indian cotton was the gasoline for the Industrial Revolution in Britain as well as the accelerator of railway projects in India. Shashi Tharoor has famously remarked that India “paid for its own oppression” under British rule. India has exported cotton and fabrics to Europe since the 16th century — in the process procuring its own slavery and that of Africa.

Harvard historian Sven Beckert writes in Empire of Cotton, “What all these European trading companies had in common was that they purchased cotton textiles in India… whence they might be consumed domestically or shipped to Africa to pay for slaves to work the plantations just beginning to take root in the New World… Slaves, after all, could only be gotten by exchanging them for the cottons from India.

Full article can be found here - https://www.thehindu.com/society/how-india-procured-slavery-with-the-export-of-cotton/article25751881.ece
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USS ALASKA

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The embargo of American cotton caused a mini-boom in India. Growers, gins, roads & railroads, shipping, warehousing, telegraph systems, and mills greatly expanded during this time frame.

Imports of Raw Cotton in to the United Kingdom from India ( in Bales )

Year / Bales
1859 / 509,695
1860 / 562,738
1861 / 986,280
1862 / 1,071,768
1863 / 1,292,984
1864 / 1,399,514
1865 / 1,266 ,513


The Value of Raw Cotton Imported in England from India

Year / Value in rupees
1B58-59 / 3,080,727
1859-60 / 3,889,159
1860-61 / 5,547,090
1861-62 / 9,563,595
1862-63 / 17,729,536
1863-64 / 33,826,646
1864-65 / 35,646,564
1865-66 / 33,522,104
1866-67 / 14,653,509


A high demand / low density product brought charlatans and shysters out in force, causing the passing of the Cotton Frauds Bill of 1863...where there is a will, there is a weasel...

"Lancashire’s demand for raw cotton was so great that cotton of any quality - inferior or superior was exported to England. It is said that even old mattresses were put into requisition to get the cotton, in return of which people used to get fair amount of money. People knew that they could make money by supplying cotton even if it was rubbish or of very inferior quality. Since there was no other source of obtaining raw cotton England had to accept it . Adulteration set in . It was not a new thing, but it had not been carried to so great an
extent as during this period."


And by 1864...

"In England, the Cotton Supply Association claimed that the quality of Indian Cotton now made it acceptable to fully one half of Lancashire's spindles and looms."
593

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uaskme

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Er no, not quite. I suggest you read up on the history of India, how the country was governed, and the level of intermarriage and intermixing that occurred at all levels although officially it didn't exist, and we had crack Indian regiments in the British Army.
God save the Queen, Seriously
 

wausaubob

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Interesting but technical article about the effect of Indian Cotton on British factories.

Econometrica, Vol. 83, No. 1 (January, 2015), 67–100
NECESSITY IS THE MOTHER OF INVENTION: INPUT SUPPLIES
AND DIRECTED TECHNICAL CHANGE
BY W. WALKER HANLON
Link

I exploit the impact of the U.S. Civil War on the British cotton textile industry, which reduced supplies of cotton from the Southern United States, forcing British producers to shift to lower-quality Indian cotton. Using detailed new data, I show that this shift induced the development of new technologies that augmented Indian cotton. As these new technologies became available, I show that the relative price of Indian/U.S. cotton rebounded to its pre-war level, despite the increased relative supply of Indian cotton. This is the first paper to establish both of these patterns empirically, lending support to the two key predictions of leading directed technical change theories.​
To do so, it exploits a large exogenous shift in relative supplies to the British cotton textile industry caused by the U.S. Civil War (April 1861–April 1865). The war, which included a blockade on Southern shipping by the Union Navy, sharply increased the cost of supplying U.S. cotton from the South. The result was a sharp depression in the industry; output dropped by as much as 50% and hundreds of thousands of mill operatives found themselves out of work or working short-time. The shortage of U.S. cotton forced British producers to turn to raw cotton from alternative suppliers, chiefly India. However, the cotton available from India differed from American cotton in important ways; it was a low-quality variety that was difficult to clean and prepare for the spinning process. Thus, this event generated a sharp shift in the relative supplies of two similar, but not identical, inputs to the production process. Historians and contemporary observers have noted the important changes that took place as a result of this event. D. A. Farnie, in his authoritative history of the British cotton textile industry, wrote, “The shortage of American cotton compelled employers to re-equip their mills in order to spin Surat [Indian cotton], and especially to improve their preparatory processes. . . The reorganization of the preparatory processes entailed such an extensive investment of capital that it amounted almost to the creation of a new industry. . . ”3​
The first contribution of this paper is to document the pattern of directed technical change generated by the shock to input supplies. Using detailed new patent data, I show that the Civil War time period was characterized by a sharp increase in innovation in three types of cotton textile machinery—gins, open- ers/scutchers, and carding machines—that were particularly important for ad- dressing the key bottlenecks in the use of Indian cotton. Comparing these three technology types to all other cotton spinning technologies, I document substan- tial increases in innovation in technologies related to the use of Indian cotton. Innovators reacted quickly, introducing simple improvements in technologies during the first year of the war, followed by more advanced machines in later years. Innovation in technologies related to Indian cotton peaked three years into the conflict, and remained high one to two years after the end of the war. Thus, the patent data reveal substantial directed technical change toward technologies that augmented Indian cotton.​
These notes tend to confirm that the British Cotton Supply Association was also working hard to get seeds from American varieties to producers located in other areas of the world.
 

USS ALASKA

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These notes tend to confirm that the British Cotton Supply Association was also working hard to get seeds from American varieties to producers located in other areas of the world.
"The Manchester lobby in Parliament pressed the Government of India to encourage cotton cultivation. The Government also had tried to introduce American seed, invite American planters and introduce cotton-gin for cleaning raw cotton."

I. Durga Parshad, 'Some Aspects of Indian Foreign Trade, 1757-1893' (London : 1932), p. 145

"In May 1863, Charles Wood was asked to supply the ryots with American seed. He also was requested that ”some sort of apostles be sent around the country to indoctrinate the ryots and spread the elements of sound agriculture." Though he considered that it was not possible to comply with this request, he passed it on to Bartle Frere."

Wood to Frere , 4.5.1863 , cited in Peter Harnetty, 'Imperialism and Free Trade : Lancashire and India in the Mid-nineteenth century' (Vancouver : 1972), pg 49.
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leftyhunter

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Interestingly enough the British cotton textile industry did not encourage cotton cultivation in Cuba and Brazil. I have seen cotton fields in El Salvador. Curious has to why the British didn't finance or encourage the Central American nations who were independent by the early 1820s to produce cotton?
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Interesting but technical article about the effect of Indian Cotton on British factories.

Econometrica, Vol. 83, No. 1 (January, 2015), 67–100
NECESSITY IS THE MOTHER OF INVENTION: INPUT SUPPLIES
AND DIRECTED TECHNICAL CHANGE
BY W. WALKER HANLON
Link

I exploit the impact of the U.S. Civil War on the British cotton textile industry, which reduced supplies of cotton from the Southern United States, forcing British producers to shift to lower-quality Indian cotton. Using detailed new data, I show that this shift induced the development of new technologies that augmented Indian cotton. As these new technologies became available, I show that the relative price of Indian/U.S. cotton rebounded to its pre-war level, despite the increased relative supply of Indian cotton. This is the first paper to establish both of these patterns empirically, lending support to the two key predictions of leading directed technical change theories.​
To do so, it exploits a large exogenous shift in relative supplies to the British cotton textile industry caused by the U.S. Civil War (April 1861–April 1865). The war, which included a blockade on Southern shipping by the Union Navy, sharply increased the cost of supplying U.S. cotton from the South. The result was a sharp depression in the industry; output dropped by as much as 50% and hundreds of thousands of mill operatives found themselves out of work or working short-time. The shortage of U.S. cotton forced British producers to turn to raw cotton from alternative suppliers, chiefly India. However, the cotton available from India differed from American cotton in important ways; it was a low-quality variety that was difficult to clean and prepare for the spinning process. Thus, this event generated a sharp shift in the relative supplies of two similar, but not identical, inputs to the production process. Historians and contemporary observers have noted the important changes that took place as a result of this event. D. A. Farnie, in his authoritative history of the British cotton textile industry, wrote, “The shortage of American cotton compelled employers to re-equip their mills in order to spin Surat [Indian cotton], and especially to improve their preparatory processes. . . The reorganization of the preparatory processes entailed such an extensive investment of capital that it amounted almost to the creation of a new industry. . . ”3​
The first contribution of this paper is to document the pattern of directed technical change generated by the shock to input supplies. Using detailed new patent data, I show that the Civil War time period was characterized by a sharp increase in innovation in three types of cotton textile machinery—gins, open- ers/scutchers, and carding machines—that were particularly important for ad- dressing the key bottlenecks in the use of Indian cotton. Comparing these three technology types to all other cotton spinning technologies, I document substan- tial increases in innovation in technologies related to the use of Indian cotton. Innovators reacted quickly, introducing simple improvements in technologies during the first year of the war, followed by more advanced machines in later years. Innovation in technologies related to Indian cotton peaked three years into the conflict, and remained high one to two years after the end of the war. Thus, the patent data reveal substantial directed technical change toward technologies that augmented Indian cotton.​
I was told there would be no math.
 


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