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44 Theoretico-Historical Perspectives

Lloyd Best



I. A PARTIAL TYPOLOGY OF which defines exclusive spheres of influence

ECONOMIC SYSTEMS of a Metropolis and the limitations on external
intercourse for the Hinterland. In the real world
The larger study1 of which this essay forms there have been and still are many examples of
a part is concerned with the comparative study this: the Inter-American System, the British
of economic systems. Following Myrdal2 and Commonwealth, the French Community, the
Seers,3 we have taken the view that economic centrally-planned economies, and so on. For
theory in the underdeveloped regions at any convenience, we assign the phenomenon a
rate , can profit by relaxing its unwitting generic term: Inter Caetera, after Alexander
preoccupation with the special case of the VI’s celebrated Bull of 1493 in which he settled
North Atlantic countries, and by proceeding the Donation between Spain and Portugal.
to a typology of structures 4 each having Secondly, there is the provision in respect
characteristic laws of motion. of the division of labour between Metropole
Plantation Economy, the particular type and Hinterland. This we will name the
which we have selected for intensive study, falls Muscovado Bias. This ‘rule’ tends to restrict
within the general class of Externally propelled the hinterland to terminal activity: either to
economies.5 Specifically, we isolate Hinterland primary production and crude processing or
Economy which can be further distinguished at the other extreme, to assembly. In either
for example, from Metropolitan Economy. In case, elaboration is left to the Metropolis and
the latter, too, the adjustment process centers with that, the lion’s share of value added.
on foreign trade and payments but the locus Thirdly, there is the specification relating
of discretion and choice is at home and it is to the monetary system. This we denote by
by this variable that we differentiate. Metropolitan Exchange Standard. It entails the
Hinterland Economy, indeed, is what is at the use in the Hinterland of metropolitan financial
discretion of Metropolitan Economy. The intermediaries, the maintenance of free
relationship between the two may be described, convertibility with metropolitan currency at a
summarily at this point, as mercantilist. In this fixed rate of exchange, and with that, the
designation inheres certain specifications assurance that the liabilities of financial
regarding what may be called the general operators in the Hinterland are fully matched
institutional framework of collaboration between by metropolitan assets. The effect is to ensure
the two. It would suffice here to note the five that Hinterland assets are readily realisable in
major rules of the game, as it were. terms of metropolitan supplies of goods and
First, there is the most general provision services.

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A Model of Pure Plantation Economy 45

Fourthly; the origin, destination and among them that we have chosen our three
carriage of trade. Let us call this the Navigation families of Hinterlands: Hinterlands of
Provision. It is meant to guarantee metropolitan settlement, of conquest, and of exploitation.
intermediation in all Hinterland trade just as The Hinterland of Conquest 8 is at one
the Metropolitan Exchange Standard ensures extreme. Here, metropolitan interest is not so
a similar intermediation in payments. much in land as a productive asset, as in the
Finally, the general conditions under which organisation of people to facilitate the
Hinterland producers are able to dispose of redistribution and transfer of wealth.
their output in the Metropolitan market — let Accordingly, State (Crown) entrepreneurship
us call this Imperial Preference. is paramount and intervention takes the form
When we move from the general rules of of military and administrative occupation. The
the mercantilist game to the more specific privilege of participating in the venture of
definitions of relationships between Metropoles conquest is closely circumscribed by royal
and Hinterlands, we must further acknowledge favour to exclusive ports, exclusive trading
the existence of at least three families of the houses and favoured conquistadores.
latter. Here we differentiate by the type of The requirements of naval and military
economic institution which achieves defense of the lines of communication — to
dominance in the hinterland. The typical the hinterland — dictate a totally exclusivist
institution is necessarily an expression of the form of external economic organisation.
motives which initiated the mercantilist Resources flow from the metropolis to the
connection, an incorporation of the resources hinterland to create infrastructure necessary
which are transferred from the metropolis and for the transfer of booty and the collection of
a recognition of the conditions encountered tribute. This, in effect, entails the harnessing
in the Hinterland. In short it is a reflection of of native labour to produce communal goods,
the way in which these determine the form of consumption supplies and precious metals. To
penetration and the organisation of resources this end, the encomienda is devised as an
for the purpose of production and trade. appropriate institution. The resource situation
The motives for initial contact may be is closed, the population being already highly
various including plunder, exchange or organised on the land. Breaches in the
production, the last for different purposes. That indigenous system of organisation are effected
is to say the ‘view’ may be short or long with by any redefinition of resources and by the
profit ‘horizons’ anywhere in-between. Related case of superior techniques of coercion. The
to this, the entrepreneur may be pirate, resulting syncretic institution is thus ‘open’ in
merchant, producer for trades or producer for some ways, ‘closed’ in others.
settlement. The resources transferred may be The surplus mobilised in a Hinterland of
any or all of the following: capital, conquest is divided into four shares, the
proprietorship, ownership, management and encomendados having already found for
labour, The initial resource situation in respect themselves. There is the royal tribute, the
to land, labour, and organisation to use quinto, a fixed proportion of the treasure
Niebohr’s6 polar types may be open or closed, gleaned. The remainder is then divided among
open if the basic resource, land, is a free good, three groups of claimants. First there is the
closed if it is scarce. In this context, we can element of rent accruing to the major officials
identify numerous types of hinterlands: — resident in the hinterland and enjoying royal
enclaves, settlements, garrisons, trading posts, favour in the form of proprietory rights to land
enceintes, gorods, to name a few.7 It is from and titles to office. Second, there is the element

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46 Theoretico-Historical Perspectives

of paniagua accruing to the minor bureaucratic surpluses of food and supplies to Hinterlands
officialdom (the ‘Senior Staff ’) who supervise specialised in staples.
the day-to-day activities of the population. The family claim constitutes a highly
Finally, there remains a residual which accrues flexible and self-sufficient unit of enterprise.
as venture profits to the merchants. Land is free in exchange for the work of
clearing it and defending it against previous
The Hinterland of Settlement and original inhabitants. The difficulty of
obtaining metropolitan purchasing power and
At the other end of the spectrum there is
the high price of imported goods induces
the Hinterland of Settlement. 9 Here
inventiveness in the making of implements and
mercantilism expresses itself less in the direct
other necessities of life.
organisation of production and more in
A high proportion of the output of the
detailed regulations concerning what may be
settlers’ farmstead is used for own account
produced and the terms and manner in which
consumption and investment. Efforts requiring
trade may proceed. Imports to the Hinterland
more resources than can be mobilised by a
must come from metropolitan sources; staples
single family are assisted by neighbours. As
must be sold exclusively in metropolitan
land is free there are no landed classes.
markets; the carrying trade is typically reserved
Taxation is organised by local communities for
to metropolitan carriers; there are prohibitions
local purposes. The ethos is democratic and
on what may be produced in the Hinterland.
egalitarian, the way of life austere and uniform.
Hinterlands of Settlement have evolved
Patterns of demand here being formed have a
from early ventures of exploration and trade.
high local content and form the basis of
They are inhabited by descendents of
markets for domestic manufacturing industry.
indentured labourers, soldiers, clerks, and
women brought by initiative on the part of the Hinterlands of Exploitation11
State (Crown), the company, or the private
group. For all practical purposes the Hinterland Between the Hinterland of conquest and
is a New Metropole. Institutions have little the Hinterlands of settlement lie Hinterlands
chance of success if they restrict rights which of Exploitation. Here the metropolitan interest
were regarded as customary or even to which shifts from plunder and exchange towards
settlers simply aspired in the metropolis. The production for trade though it never reaches
‘open resource’ situation therefore creates ‘open’ production for hinterland consumption.
institutions.10 Production is organised around Whereas in the Hinterlands of conquest the
the family unit. metropolis provides only military and
Initially the settlers engage in production administrative infrastructure now it provides
both of export staples and of foodstuffs for economic enterprise, organisation and initial
home consumption. They must pay back capital, as well. Metropolitan labour however,
flows only to Hinterlands of settlement. Here
advances as well as subsist. If their competitive
labour is brought in from other countries.
position as exporters of staples, is weak and
These are selected with regard to military and
their cash earnings on that account are
cultural considerations which permit
correspondingly small, their best possibility for
institutions compatible with both the resource
earning foreign exchange is by selling their situation and the particular entrepreneurial
ethos involved.

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A Model of Pure Plantation Economy 47

The combination of a merchant-pirate Since the economy produces almost

ethos with a short view and the introduction exclusively for trade with the metropolis, the
of labour into an open resource situation, merchant occupies a strategic position. He
governs the form of social and economic operates at the metropolitan centre where
organisation in the hinterland in much the finance and shipping are organised, supplies
same way as the mercantilist intent to transfer mobilized, and output disposed of. He is
a surplus dictates exclusivist trading particularly well placed to secure his share of
arrangements with the metropolis. Where land the product, whatever the state of trade.
is free to be used for subsistence production, In the Hinterland of exploitation then, the
the recruitment of labour exclusively for export typical unit of enterprise is the joint-stock
production imposes a need for ‘total economic trading company. This mobilises the venture
institutions’ so as to encompass the entire capital, and converts it into fixed capital —
existence of the work force.12 slaves and equipment, — as well as into
The plantation which admits virtually no working capital — the ‘magazines’ of
distinction between organisation and society, provisions, tools and supplies. The plantation
and chattel slavery which deprives workers of is the typical unit of production. Save for
all civil rights including right to property, supplies produced and consumed on own-
together furnish an ideal framework.13 Hence, account, it provides a single crop. Accordingly,
the term Plantation Economy for the particular the hinterland economy is comprised of a single
species of Hinterland Economy which we have sector, fractured into plantations, each a self-
selected for intensive study. contained, self-sufficient, ‘total’ institution,
encompassing even its own civil government.
II . PLANTATION ECONOMY14 Military government is provided by the
metropolis. The pure plantation economy is
With the shift to mercantile production, modified only by the existence of a few nomadic
the Crown is now largely passive except in native survivors, runaway slaves, and small
framing the regulations regarding trade, settlers from the metropolis who resist the
production and property. It participates by hegemony of the plantation.
dispensing titles of land ownership to favoured The unit of enterprise and the unit of
intermediaries. These are the lords proprietors. production are linked by the processes of supply
For a consideration tantamount to rent, they and disposal. Within the framework of
in turn, farm out their rights to joint-stock mercantile regulations laid down by the
trading companies under the auspices of which metropolitan government, trade and payments
ventures are undertaken. Only this unit of are effected as ‘intra-company’ transfers and
enterprise can mobilise the merchant skills and book transactions. The only breach in the
the enormous concentrations of capital needed. closed nature of the business occurs when the
The trading company initially tends to metropolis is unable to furnish provisions. This
encourage pooling of capital and sharing of opens the way to the interloper. Best placed to
entrepreneurship. Partnership is common. exploit the opportunity are Hinterlands of
Stock is ventured by lord, merchant, and settlement attached to the same metropolis).16
planter, alike.15 By dint of their disadvantage in staple
But even if it is planters who transport production, they are most eager to earn
their persons to the hinterland, it is by and exchange and they alone have the required
large a merchant’s gain and it is he who takes surplus of food and stores. Besides, being
the title of venturer. within the same mercantile walls they are better

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48 Theoretico-Historical Perspectives

able to finance a triangular trade through the give the plantation economy no chance to
metropolitan merchants than potential diversify itself. Any dynamic in the economy
competitors. They fall within the provisions must then be infused by the surviving small
of the Navigation Provision, the Metropolitan settlers and by manumitted slaves. But the
Exchange Standard and of course Inter-Caetera. former are pushed out as the plantations
engross themselves; the latter, brought up on
The Golden Age plantation fare, have a high propensity to
import and seek opportunities to produce
In the nature of the case, the foundation goods or services for export.
period of the plantation economy constitutes The second characteristic 18 of pure
a veritable golden age. The system responds plantation economy which becomes established
exclusively to external demand. Indeed, its in the foundation period is the form of
establishment has been prompted by excess adjustment to fluctuating earnings. Market
metropolitan demand and high prices. More conditions though favourable in general,
slave labour is introduced and more virgin land vary from time to time in response to
is brought under cultivation. Output per slave temporary over-expansion, changes of weather,
is well above input per slave. There is a outbreak of war, and the like. Favourable
considerable surplus product available for conditions encourage expansion. But
distribution between lords proprietors, planters unfavourable conditions cannot be met by
and merchants. If we abstract from income contraction, since labour-power is a fixed cost.
produced — by indigenous people, runaway When therefore, they are forced to reduce the
slaves, or small settlers, between them they output of the staple, the planters typically deploy
receive the whole of the domestic product. The slave labour power towards domestic and other
product accruing to slaves is, strictly speaking, services, towards augmentation of the
an item of maintenance costs. During this infrastructure for export production, and
foundation period the economy acquires towards the production of substitutes for
characteristic patterns of behaviour. imported supplies. But the extent to which these
The first characteristic relates to the alternatives can be pursued without disrupting
pattern of expansion. Since all supplies and the routines, altering the methods of
capital goods used by the plantation are organisation, and modifying the structure of
imported, the secondary effect of expansion ski1l appropriate to the main task is severely
of the output of these goods is experienced in limited by the high degree of specialisation
the metropolis and in hinterlands of settlement involved in the production of the staple.
which are able to operate within the mercantile Adjustment therefore tends to take the form
regulations. of political intervention to restrict entry into
The secondary effect of expenditure out the business by land policy, and otherwise to
of factor incomes depends partly on where the support prices or reduce costs. Such
landlords, planter and merchants live, and intervention is facilitated by metropolitan
more importantly, on their pattern of demand. residence, or frequent visits by proprietors,
As a restricted high income group their merchants, and planters.
expenditures already tend to create a diversified The third characteristic of the plantation
demand for a whole range of luxury goods other economy relates to the size and distribution of
than large demands for a few basic items.17 the ‘product. For several reasons, all deriving
If in addition, they live abroad and have a from the ‘total’ and closed character of the
taste for metropolitan wares, their expenditures business, rewards and profits, in Hall’s

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A Model of Pure Plantation Economy 49

terminology, are marked by a certain Gall and Wormwood

‘incalculability’.19 First of all, slave-labour, the
main capital asset, is subject to an A second phase is initiated in pure
indeterminable depreciation. Secondly, the plantation economy as planters assume the
output of capital goods in the form of cleared entrepreneurial role and receive the
land, and construction, and the performance corresponding venture profits or losses. This
of consumer services by slaves, constitute is the phase of decline and collapse of Gall and
income to planters.20 On both counts, real net Wormwood as one planter described it.
product is made difficult to measure. Thirdly, For a time, while profits are still high, they
proprietor, planter and merchant tend not to are able to encumber their estates with legacies.
be distinguishable one from the other. It is They are also in a position to employ senior
therefore difficult to identify what is rent, what managerial staff in the hinterland while they
is reward for planting, or what is venture profit themselves retire to the metropolis, having
on merchandising. Fourthly, the practice of acquired title from the proprietors. But as the
provisioning the plantation in kind and of system expands, costs rise and prices come
settling claims in produce and in both the steadily down. Soil exhaustion forces the
Hinterland and the Metropolis separately, employment of more labour-power per acre
complicates accounting enormously. Finally, and per unit of output. At the same time the
the communal consumption patterns associated rising demand for labour forces up the price
with Great House living and the absence of of slaves. Meanwhile chronic oversupply
any real distinction between economic depresses the market. Rent is eliminated since
organisation and plantation society, clouds the new entrants undertake cultivation on virgin
distinction between intermediate supplies in land. Rising costs and falling prices squeeze
the form of feeding to slaves and factor incomes profits thinner and thinner.
in the form of paniagua to ‘senior staff ’. What is more, there is now an extra
Over time however, the situation burden of costs. Encumbrances made in better
simplifies itself to some extent. As the system times are a fixed charge on product. The
expands, the merchants are called upon to manager-attorney in the hinterland has to
mobilise new and larger stocks of capital. As receive his paniagua and his share of product.
new land is engrossed and fresh territory opened Besides, he probably exploits the opportunity
up, supply out-paces demand and prices to increase his real draught on plantation
weaken. Profits however, remain good and income in other ways. Typically he is a factor
expansion continues since, in any event, new who draws commission from the metropolitan
land yields higher profits than old. The merchant. He stands therefore, to gain by
merchants now have a double incentive to inflating the plantation’s import needs. As
protect the earning power of their capital by manager and attorney he benefits from
switching to mortgage lending on old augmenting current output as the expense of a
enterprise and by shunting funds to new. swifter consumption of the planter’s capital.22
Gradually, the longer established planters As bad times persist, mortgage debt is
are accorded the entire entrepreneurial contracted or extended, so increasing the
function; the newer ones, a diminishing burden of fixed interest charges on product.
minority, still tend to share it with the Deteriorating conditions of trade increase risk
merchants.21 to creditors and- push interest rates up.
Yet the planter has few possibilities of
successful adjustment. Even if he can find the

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50 Theoretico-Historical Perspectives

capital for it, the rules do not permit him to play cheaper supplies which in turn, make the
undertake the elaboration of his product in system of Imperial Preference unprofitable to
the hinterland. He is restrained by the so- called the metropole and the case for dismantling the
‘Muscovado Bias’. Nor does the high degree of exclusivist arrangements irresistible.
specialisation of all the hinterland institutions Part of the switch of the capital made by
including the near-uniqueness of the form of the merchant class in the Hinterland trade is
labour organisation, permit him any real into industry. To the extent that the resulting
flexibility in the choice of production industrialisation becomes a cumulative process
techniques or in the composition of output. it makes the Hinterland more and more a taker
To move to new territory is an expensive and of technology and of taste from the metropole.
troublesome business requiring him to uproot And in so far as the bargaining power of
a whole society and to move an entire agro- workers in the metropole is strengthened in
industrial complex.23 the process, a floor is set on the prices of
Caught in a ‘Goveia Syndrome’, his only manufactures and therefore on the extent to
genuine option is to seek support for prices which the long-run terms of trade can ever
through the use of political influence in the favour the Hinterland.
metropolis. These results can be avoided only if the
But by now the metropolitan economy is Plantation Economy faces the fact of over-
undergoing far reaching changes. Merchant maturity and lack of competitiveness by
enterprise has been organizing industry, replacing its basic structures and institutions
activating agriculture, and transforming the and so by introducing more flexibility into the
economy. Increased commodity production adjustment process. This implies a ‘political’
both in the hinterland and the metropolis, solution. The economic solution is largely ruled
reduces the scarcity value of the imported out by the fact that it requires large input capital
luxuries. In the course of time the expansion to despecialise, to transform technology, and
of production and the extension of the market to finance the culturally entrenched taste for
erodes mercantile profit and with that, imports built up in the Golden Age.
mercantile influence. This is the ‘Williams’ In the age of decline these are not
effect.24 available. The economy must therefore
Capital shifts from trade to production. borrow. With taste and technology fixed, this
Large numbers of workers have now to be fed implies the consumption of capital, which
in the towns. Expansion in the metropolis too, expresses itself in growing indebtedness, and
has brought the system up against the limited in lagging productivity and output. The
supply of land. The exclusivist structure erected growing indebtedness has two effects. First, it
to protect the profitability of mercantile increases the discretionary power of the
economy is seen by rising industrial interests creditors and secondly, it reduces the share of
as a brake on further expansion. total product which is unencumbered and
The signals of change reach the Hinterland therefore disposable. The further effect of this
in the form of inadequate profits even for is to discriminate against those in the
reasonably efficient producers. Ultimately, the Hinterland with the least power to intervene.
cause of the secular downward run in prices is These are the slaves. By enhancing the degree
the shift of investment into new terrain as of political instability, this only hastens the
metropolitan ‘merchants’ use their discretionary need for a practical solution.
power to switch capital to more profitable The possibility and the character of such
enterprise. The result of this is to bring into a solution are both powerfully influenced by

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A Model of Pure Plantation Economy 51

the economics of the situation. The growth of Hinterland of Settlement

the discretion of metropolitan creditors is
paralleled by a willingness of the metropolis to Adjustment in pure Hinterlands of
maintain stability by military intervention. settlement is comparatively easy. Foodstuffs
Economic decline however, implies mounting previously produced by settlers for domestic
costs to this operation. Ultimately, when the consumption become major staples in high
costs become intolerable, the Metropolis has demand in the growing metropolitan markets.
little choice but to attempt the political solution Hinterlands of settlement established within
which is needed by itself initiating institutional the framework of the old mercantile system
reform. At this point, the Plantation Economy experience population expansion as successive
is presented with a new situation though it waves of migrants are displaced from the land
carries forward among other things, a legacy by the process of industrialisation in the
of taste and of a capital stock in mortgage to metropolis. Entirely new hinterlands of
metropolitan merchants. settlement are also founded.
The demand for cheap food and cheap
III. ADJUSTMENT OF agricultural raw materials induces a flow of
HINTERLANDS25 capital from the metropolis to the hinterland.
The objective is to extend the area of economic
The change in economic conditions in the cultivation by lowering the costs of
metropolis which induce their developments transportation. From profits accumulated in
in Plantation Economy also affect other the metropolis there is a real transfer in the
Hinterland economies and they are all called form of capital investment in railways, ports,
upon to adjust. Those which have been harbours, steamships and other forms of
exporting within the framework of mercantile infrastructure directed to supplying
protection are forced to become competitive metropolitan markets with cheap foodstuffs.
either by reducing costs or by switching to The metropolitan shortage of land is eliminated
new exports. Or they must substitute home by extending the frontiers of cultivation across
production for imports. Those which have not the oceans. While geographic and economic
been exporting now have the chance to do so. factors favour some hinterlands of settlement
The industrial expansion of the metropolis in comparison to others, the less favoured
does not merely increase the demand for wage eventually get their turn as metropolitan
goods. Also wanted are fertilisers for the new demand and infrastructure investment extend
lands, raw materials and mineral resources for the frontiers of cultivation.
industry, better quality and more exotic foods
for consumers as the standard of living of the Hinterlands of Conquest
metropolitan population rises.
The pattern of adjustment is profoundly Hinterlands of conquest find adjustment
influenced by whether it is a hinterland of a far more complicated matter. They have the
conquest, a hinterland of exploitation, or a formidable problem of replacing the military
hinterland of settlement by the degree of and administrative apparatus which served
maturity which each has achieved in its status metropolitan plunder and transfer by one which
as a member of one of the three groups; and facilitates metropolitan participation in
by the strength of the stimulus to produce for production for the international economy.
the external market which reaches it either from While metropolitan governments may help in
its own metropolis or from some other. ‘calling this new world into existence’, the

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52 Theoretico-Historical Perspectives

pressure to transform the institutional order enterprise is the metropolitan bank or firm
is exerted principally by private enterprise in which initiates export projects, as a means of
quest of specific resources. Crown selling metropolitan investment goods, of
entrepreneurship is succeeded by private investing metropolitan capital and of
entrepreneurship which is, however, financial provisioning the metropolitan economy with
rather than mercantile or industrial. Its needed supplies. Local entrepreneurs are
influence on the hinterland is exercised by involved in furnishing capital and in the
raising capital and making funds available to management of production. They do not,
the government to create infrastructure suitable however, constitute the dynamic class in the
for export production. Resources for purely economy.
domestic uses receive assistance only
incidentally. Mature Hinterlands of Exploitation26
Transformation proceeds through the
establishment of units of production which The greatest difficulty in adjusting to the
tend to be self-contained and self-sufficient. breakdown of the mercantile order is
They possess a flexibility which the experienced by the hinterlands of exploitation
institutional order denies to producers in because here the mercantile system has left
general. They are established either by behind its most elaborate productive apparatus.
enclosure of land and local labour or by the The legacy of institutions, structures and
introduction of alien labour after the fashion behaviour patterns of the plantation system are
of the plantation with the important difference so deeply entrenched that adjustment tends to
that there exists an enormous domestic sector. take place as an adaptation within the bounds
The phenomenon of enclaves thus appears. At of the established framework. By and large,
the same time, or alternatively, entirely new the economies do not experience any
hinterlands of settlement are founded along- considerable or sustained relief from their
side the hinterlands of conquest and begin to dependence on the traditional export staple.
draw recruits from them. The more these At the same time, there exists such a
hinterlands of conquest are impelled by their variety of situations that generalisations
own maturity to adopt new forms of economic concerning the responses of the various
organisation, the more there is a merging of economies to the ending of the mercantilist
migrants from the traditional order with new era is difficult. It is therefore necessary to
settlers. This creates the phenomenon of dual distinguish at least three initial situations.
economy. On the criterion of established patterns
The enclaves, and the settlements on the of land use, we distinguish the mature
flanks of the old hinterlands of conquest are, plantation economy, the new plantation
in the nature of the case, small and wealthy in economy and the mixed plantation economy.
relation to the setting. They are highly In the mature hinterlands, staple
specialized in exportation and earn foreign production has long encompassed the entire
exchange out of which to supply their diverse territory. Plantations exhaust the area of
consumption needs. Expenditures place no cultivable land. The system has expanded to
great pressure on supply in the hinterland itself. its limit and beyond. Soil exhaustion and
Supply conditions in any case are akin to those increasing difficulties in obtaining slaves have
of a pure hinterland of conquest. The system raised costs of production while over-supply
expands in response to the growth of external of metropolitan markets has been depressing
demand. For all practical purposes, the unit of prices. The plantations are no longer viable.

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A Model of Pure Plantation Economy 53

Some go out of business, others cut back restricted the supply of labour available to the
production, and land and slaves are thrown plantation, and the greater the upward pressure
into idleness. Plantations turn to the on wage rates. The labour market is also
metropolitan government for aid in the form affected in a very special way by the high value
of subsidies, grants, bounties, development placed on independence which fixes a
loans and assistance for purpose of the minimum requirement of own-account
maintaining of law and order as enforced production and by taste- patterns which dictate
idleness of work-units brings political a minimum requirement of imported
consumption goods. These are parameters fixed
instability. However, the political climate in
by the legacy of slavery. However high are wage
the metropolis is hostile to any bolstering of
rates on the estates, labour will work its own
mercantilist privilege. The new industrialist land in the interest of independence. However
class is actively engaged in dismantling the low they be, cultivators will offer a few tasks
traditional exclusivist structures. The of work in order to procure cash to buy
metropolitan government responds to the imports.
pressures by abolishing the old labour regime The necessity to work for low wages in
in the hinterlands and by removing the market the latter case is imposed by the limited demand
monopoly. for domestically produced output. This in turn
The effect of these changes is to aggravate reflects the leakages out of plantation income,
either because many planters live in the
the problems of the plantations and to force
metropolis or because, when they are resident,
them to undertake internal adjustments. To
considerations of taste dictate consumption
begin with, more plantations fold up and more patterns with a high import content. Thus the
land is released. The liberated slaves are able legacy of obligations to absentee owners and
to acquire land by purchase or by squatting. the inherited taste for metropolitan goods
To the extent that peasants and small farmers inhibit the diversification of the economy by
establish themselves outside the plantation setting close limits on the demand for
sector, the planters are faced by a smaller and domestically produced output. Both the
less reliable labour supply and by rising wage planters and the cultivators need the foreign
rates. The competition for labour directly exchange provided by the export staple.
Faced by falling prices and rising costs the
attributable to the establishment of a domestic
planters must find ways to maintain profitability.
agricultural sector is aggravated by the growth Specifically, they must either introduce
of an urban sector. improved methods and increase output per
A market for crafts and services springs man, or they must secure more and cheaper
up in response to the greater money demand labour through a greater participation by the
resulting from higher levels of real income and cultivators in estate work.
from the break up of the old system of bulk However, the extent to which productivity
importation and provisioning in kind. can be raised is limited by the difficulty which
The terms on which the ex-slaves will offer a moribund business faces in raising funds.
The planters therefore attempt to raise output
labour to the plantation are determined by the
per man on the estate by measures which do
amount of land which they can acquire and by
not require capital. They offer labour the
the productivity of that land. The greater the incentive of metayage as an incentive to raising
amount of land available to the cultivators and productivity. Cultivators accept this as a way
the higher their productivity, the more

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54 Theoretico-Historical Perspectives

of securing their foreign exchange on a The old mercantile system to which these
permanent basis. But the planters cannot afford lands were attached, had lacked the dynamic
to make the scheme permanent because in to organize production. Entrepreneurship had
good years they have to relinquish too big a concentrated either on plunder or on exchange.
cut of their profits. With the internationalisation of trade and
They therefore use their political influence capital flows across old mercantile boundaries,
to create more favourable conditions in the hitherto unexploited lands are in a prime
labour market. They enforce restrictive land position to cultivate the export staple.
and credit policies on the government with New techniques of production can be
the intention of limiting the amount of land adopted from the start. To take advantage of
which cultivators can acquire. these, large capital investments are required
Similarly, in education policy, they oppose and are easily attracted to unencumbered
efforts by the government and the church to property. On all counts the competitive
equip the population with skills that would potential of these new plantations is strong.
enhance the productivity of the domestic Because industrialisation in the metropolitan
sector. They attempt to restrict entry into urban countries is now well underway, capital comes
trades. Finally they impose taxation on imports in the form of machinery and equipment with
in order to reduce the purchasing power of built in modern technology. Insofar as the
wages and so to draw more labour onto the capital comes from newer industrial countries
market. In the face of this sort of pressure, with less developed lending institutions where
the only escape of the population lies in firms are large and dynamic, investments tend
migration. The irony of this is that it makes it to be effected through subsidiaries.
possible for more efficient plantations to The constraint on expansion is the
establish themselves in other hinterlands. availability of labour. The hinterland economy
Efforts to solve the problems of high cost has been slowly developing from a military
production by rationalisation are thus garrison into a colony of peasant farms and
frustrated. The mature hinterlands survive only
indifferent plantations. Labour must therefore
to the extent that the prices of manufactured
be introduced from outside.
imports fall faster than staple prices; or, to the
The mature hinterlands are a natural
extent that as producers with a backward
source. What they cannot provide must be
technology, they have a secure market in
procured elsewhere. In either case, institutional
supplying inputs to metropolitan processors
forms must be devised to ensure efficient
whose technology is correspondingly out of
control of work-units in a situation of abundant
date. Under threat of late corners with newer
land. This calls for indenture, contract labour,
techniques, producers in both the metropolis
or a ratooning of slavery in some form.
and the hinterland have a common interest in
Industrialisation in metropolitan countries and
erecting shelters for their less efficient
in the hinterlands of settlement creates a rising
demand for the staple but is remunerative only
to a reasonably efficient producer. The new
New Hinterlands of Exploitation27
lands expand at the expense of the mature
plantation economies, which then release a
While in the mature Hinterlands of
constant stream of labour.
exploitation the passing of the mercantilist era
As expansion proceeds, the plantations
introduces severe pressure on profits, in the
encroach on the preserves of the established
new lands opportunities for staple cultivation
peasant sector. They engross land and displace
are opened up.

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A Model of Pure Plantation Economy 55

labour. The ready availability of foreign bankruptcy and the peasant sector is expanded
exchange invites the importation of a highly by the exodus of land and labour from staple
diversified set of consumer goods, restricting cultivation.
the expansionary effect of rising incomes on In this economy there are no landless
domestic suppliers. The plantation sector workers. Three forms of land settlement can
becomes the major influence on public policy be discerned. First, there are small farmers
and determines the allocation of infrastructure who own freeholds and engage in the
investment. A highly specialized economy cultivation of a number of minor cash crops
develops, well equipped to take advantage of for the metropolitan markets. Secondly, there
favourable markets. Fortified by their are occasional labourers who cultivate freeholds
competitive advantages over more mature on which they grow provisions for their own
producers, plantations expound without limit. use, and for domestic sale. Thirdly, there are
full time labourers who rent provision grounds
The Mixed Plantation Hinterland28 from the plantations.
The expansion of the independent rural
The mixed plantation hinterland arrives sector generates a corresponding growth of
at the end of the mercantile era with an urban activity. Craftsmen, artisans, and petty
economy in which the declining fortunes of traders join the merchants in servicing the
the staple have set in before plantations occupy requirements of the enlarged domestic sector.
all cultivable land. Although plantations A town class emerges.
predominate, there exists a peasant sector of Squeezed by rising wage costs, the
small settlers who have always been outside plantations seek ways to stabilise their labour
the orbit of the staple, or who have fled from supply by the same methods employed by their
it. counterparts in mature plantation colonies.
In the peasant sector leakages out of These methods however, prove much less
income are lower than in the plantation sector. effective. Labour has far more alternative
Peasants and small farmers are relatively free
employment on its own land. Government is
from the legacy of the plantation and their
far less amenable to plantation pressure because
consumption patterns have a correspondingly
of the countervailing political influence on the
smaller import content. While they produce
town classes and the small farmers.
minor exports, they are not compelled to
specialise in them because they have fewer Nowhere is this better illustrated than in
requirements for foreign exchange. A large part the frustration of attempts to introduce external
of their output is consumed within the sector. labour of a kind similar to that brought into the
These settlers have a keen interest in raising new plantation colonies. With the exception of
productivity. They exercise a restraining the farmers who themselves require cheap wage
influence on the planters so that public policy labour, the population effectively resists the
is not exclusively dominated by plantation imposition of taxation for purposes which are
interests. Infrastructure is correspondingly less designed to bring benefits mainly to the planters.
specific to the staple than in mature plantation The merchants in particular, are adamant
colonies. in their opposition to import duties which would
The break-up of the mercantilist labour restrict domestic purchasing power and so affect
regime, and the ready availability of land exert their earnings.
strong upward pressure on wage rates. The planters’ only option is to improve
Adjustment takes the form of widespread
techniques and raise productivity. This however,

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56 Theoretico-Historical Perspectives

demands more capital than they can mobilize Levitt, Selected Essays, mimeo 1967.
2. Economic theory and the Underdeveloped Regions,
on the basis of their indifferent profits.
Duckworth, London 1957.
Unlike new hinterlands of exploitation, the 3. ‘The Limitations of the Special Case’, reprinted
staple cannot attract external capital to modernize in Myint and Knapp (eds.) The Teaching of
and rationalise. The conditions on which land Development Economics, Frank Cass, London.
1966. For a discussion of the application of the
and labour are available are very much less
‘Special Case’ to the Caribbean, see Lloyd Best,
favourable. Unlike mature hinterlands of Un Modelo de Economia Pura de Plantacion,
exploitation, the mixed economies adjust to the Universidad Autonama de Santo Domingo,
break-up of mercantilism by increasing the forthcoming.
4. For one excellent attempt to do this see Dudley
diversification of output.
Seers, ‘An Approach to the Short-Period Analysis
The availability of land and the existence of Primary Producing Economies’, in Oxford
of political structures independent of the Economic Papers, Vol. 11, No. 1, February 1959.
plantation, provide an escape from the staple. 5. The Case of Mauritius, presented by Phillipe
Hein as a companion paper to this, is of the
For these reasons this type of hinterland is
same species. As Heim points out, they have a
unique in regard to its economic diversity. kinship with Seers’ ‘Open Petroleum Ecomony’
In the post mercantilist era, the dynamic Social and Economic Studies, June 1964. For a
of expansion in these territories passes to the discussion of the similarity see, Lloyd Best,
‘Economic Planning in Guyana’, The Caribbean
independent sector. However, the legacy of the
in Transition, Andic & Mathews, (eds.),
plantation is carried into the new domestic- University of Puerto Rico, 1965.
sectors in the form of local and regional 6. Herman Niebohr, Slavery as an Industrial System,
consumption patterns. The internal migration Martinus Nijhoff, The Hague 1900. For these
concepts, see p. 386.
of labour out of the plantations hardly lowers
7. See p. 22 Henri Pirenne, Economic and Social
the propensity to import and undermines the History of Medieval Europe, for multiple forms of
potential of a growing domestic market. At the penetration particularly by the Norsemen. Also
same time, the migration of the staple to the T.S, William Studies in Elizabethan Foreign Trade,
Manchester, 1959.
new lands, establishes highly import-intensive 8. This is meant to correspond to the case of Spain
patterns of consumption in neighbouring in Andean America and New Spain. For
territories. The effect is to stunt the organic background see particularly, J.H. Parry, The
development of a regional market where Spanish Seaborne Empire, London, 1966.
9. This is meant to correspond to the case of the
population and income growth may create large- North and Middle Colonies of North America,
scale demand for a range of local produce. The The classic work is Charles M. Andrews, The
economic future of the colony therefore hangs Colonial Period of American.History, Yale, New
on its ability to supply new export staples with Haven 1937. See also Louis Hartz, The
Founding of New Societies, Harcourt, Brace and
brighter prospects than the old.29
World, New York, 1964.
10. The conditions under which initial institutions
Notes broke down in some North American states are
discussed in Sigmund Diamond, The Creation
1. This is a study of so-called ‘Industrialisation and of Society in the New World, Rand McNally,
Growth in the Caribbean’. It is being undertaken Chicago, 1963.
by the West Indies Project Team under the 11. For a definition of the boundaries of this
aegis of the Centre for Developing Areas Study, experience see, Charles Wagley, ‘Plantation-
McGill University. This paper draws heavily on America: A Culture Sphere,’ in Vera Rubin (ed.),
joint work particularly between the author and Caribbean Studies: A Symposium, University of
Professor Kari Levitt. See Lloyd Best and Kari Washington, Seattle, 1960.

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A Model of Pure Plantation Economy 57

12. The concept of ‘total institutions’ comes from 28. Jamaica is the outstanding real-life example of
Erving Goffman, Asylums, Doubleday, New this abstraction.
York, 1961. For an adaptation to the sociology 29. This article appeared in a slightly different format
of the plantation see Raymond Smith, ‘Social elsewhere.
Stratification, Cultural Pluralism and
Integration in West Indian Societies’, in
Caribbean Integration, Sybil Lewis & Tom
Mathews, Institute of Caribbean Studies,
University of Puerto Rico, Rio Piedras, 1967.
13. Edgar T. Thompson, ‘The Plantation Cycle and
Problems of Typology’, in Vera Rubin, op. cit.
14. In this section no attempt will be made at
documentation in detail since this is only a
summary presentation of material. References
are thus general for the most part. They are also
confined to secondary sources (mainly by design
largely to stress the methodological point that
economists have to rely on the output of
historians to discover, check and make available
the source materials which are their input, as it
15. Richard Pares, p.1-13 passim., Merchants and
Planters, Economic History Society,
Cambridge, 1960.
16. p. 64, Cleso Furtado, Development and
Underdevelopment, University of California,
Berkeley, and Los Angeles, 1967.
17. Lloyd Best, ‘Current Development Strategy and
Economic Integration in the Caribbean’, Lewis
and Mathews, op.cit., p.61, ‘The Mechanism
of Adjustment.’
19. ‘Incalculability as a feature of Sugar Production
during the Eighteenth Century’, Social and
Economic Studies, Sept, 1961.
20. Celso Furtado, Cap IX, ‘Flujo de ingreso y
crecemiento’, Formacion Economica del Brasil,
Fondo Cultural Economica, Mexico, 1962
21. Pares, Merchants and Planters, pp. 29-37
22. p.21, Douglas Hall, ‘Absentee Proprietorship
in the British West Indies’, in The Jamaica
Historical Review, Vol. IV, 1964.
23. Elsa Goveia, Slave Society in the British Leeward
Islands at The End of the Eighteenth Century,
Yale, New Haven 1965.
24. Eric Williams, Capitalism and Slavery, Deutsch,
London, 1964.
25. This section is included again, to assist time
and space comparisons and is summarily
26. The best cases in point are Barbados and the
27. This model is best instanced by Trinidad in the
19th Century and particularly by Cuba in the
19th and 20th centuries.

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