¹ Shipping, Maritime Trade, and the Economic Development of Colonial North America (Cambridge: Cambridge University Press, forthcoming 1972).Google Scholar

² By distribution we mean activities associated with transporting and distributing commodities from producers to consumers, and by production we mean activities associated with the physical production of commodities within limited geographical areas.

³ The values for Great Britain are based upon the English official values (U.S. Bureau of the Census, Historical Statistics of the United States, Colonial Times to 1957 [Washington, D.C.: U.S. Government Printing Office, 1960], p. 757)Google Scholar plus the Scottish official values for 1758–1762 (London, Public Record Office, Customs 14). Exports to Scotland for the earlier periods have been based upon tobacco exports to there (Historical Statistics, p. 766). Exports for 1768–1772 have been estimated from data in the American customs records (London, Public Record Office, Customs 16/1).

⁴ Gallman, Robert E., “The Pace and Pattern of American Economic Growth,” in Davis, Easterlin, Parker, et al., American Economic Growth: An Economist's History of the United States (New York: Harper & Row, 1972).Google Scholar Gallman's estimates are supported by probable ranges of per capita output developed by Jones, Alice Hanson, “Wealth Estimates for the American Middle Colonies, 1774,” Economic Development and Cultural Change, XVIII, 4, Supplement (July, 1970), p. 129Google Scholar; and Klingaman, David, “Food Surpluses and Deficits in the American Colonies, 1768–1772,” The Journal of Economic History, XXXI, 3 (Sept., 1971), 553–69.CrossRefGoogle Scholar Gallman's estimates are based partly upon Mrs. Jones’ wealth estimates.

⁵ Gallman, “The Pace and Pattern ….” These estimates imply an annual growth rate of per capita output of less than one-half of 1 percent.

⁷ Shepherd, James F. and Walton, Gary M., “Estimates of ‘Invisible’ Earnings in the Balance of Payments of the British North American Colonies, 1768–1772,” The Journal of Economic History, XXIX, 2 (June, 1969), 230–63.CrossRefGoogle Scholar

⁷ Such percentages for the early eighteenth century, however, may overstate the proportion overseas trade formed of total output because levels of per capita output may have been greater, or, as was likely the case, because invisible earnings were not as large relative to commodity trade at the beginning of the century.

⁸ Historical Statistics, p. 756.

⁹ This result must be qualified to the extent their products were exported from other colonies, as was, to some degree, the case (some North Carolina tobacco was said to have been exported from Virginia, and some commodities produced in east and west New Jersey were exported through New York and Philadelphia, respectively).

¹⁰ See Klingaman, “Food Surpluses …”; and James F. Shepherd and Samuel H. Williamson, “The Coastal Trade of the British North American Colonies, 1768–1772,” paper presented to the Conference on the Application of Economic Theory and Quantitative Techniques to Problems of Economic History, University of Wisconsin, Madison, Wisconsin, April 30, 1971.

¹¹ The estimate for Newfoundland must be qualified because the recorded exports may have included the catch of the west country fishermen from Britain in addition to that of the resident population. There is no way of knowing for certain (the source gives no indication), but probably the British catch was included because the cod were dried ashore. On the other hand, the source did state that these were exports from St. Johns only; therefore, total exports from Newfoundland may have been even greater.

¹² Shepherd and Williamson.

¹³ These figures do not necessarily reflect the origin of the imports (or final destination of the exports) because most goods not of British or West Indian origin were channelled through Great Britain to the colonies.

¹⁴ Historical Statistics, p. 766.

¹⁵ Shepherd and Williamson.

¹⁶ Shepherd and Walton, “Estimates of ‘Invisible’ Earnings …. “A large source of additional earnings was the civil and defense expenditures of the British government in the colonies. These more than offset expenditures of foreign exchange on slaves and indentured servants, which were not included in the above discussion of commodity trade.

¹⁷ This contention is examined for 1768–1772 in detail in ibid.

¹⁸ The comparison of the explicit distribution charges on pitch in Table 6 to gross sales understates the importance of distribution costs in that the charges do not reflect the complete difference between a colonial planter's selling price and the price paid by a British or European merchant. The net proceeds include some inventory, packaging, insurance, and transport costs, as well as a return to the colonial merchant for his services and assumption of risk.

¹⁹ Tobacco Sales Book, Wallace, Davidson, and Johnson, Maryland Hall of Records, Annapolis, Maryland.

²⁰ Nettels, Curtis P., “England's Trade with New England and New York, 1685–1720,” Publications of the Colonial Society of Massachusetts, XXVIII (Feb. 1933), p. 326.Google Scholar

²¹ Around the turn of the eighteenth century, 137 pounds in Massachusetts currency would buy 100 pounds sterling; see Nettels, Curtis P., The Money Supply of the American Colonies before 1720 (New York: Augustus M. Kelly, 1964 [1934]), p. 181.Google Scholar

²² Soltow, J. H., “Scottish Traders in Virginia, 1750–1775,” The Economic History Review, Second Series, XII, 1 (Aug. 1959), 93.Google Scholar

²³ Samuel Powel, Jr., Invoice and Day Book, 1748–1750, The Historical Society of Pennsylvania, Philadelphia, Pennsylvania.

²⁴ Gray, Lewis C., History of Agriculture in the Southern United States to 1860 (Washington, D.C.: Carnegie Institute of Washington, 1933), I, p. 224.Google Scholar Gray's example was for a hogshead of 790 pounds, which would have been worth probably not more than 1 1/2 d. per pound in the colonies. If the average price was lower, distribution costs as a percentage of colonial value would have been greater than 75 percent.

²⁵ Philadelphia prices of leaf tobacco and exchange rates between Pennsylvania currency and English sterling are given in Bezanson, Anne, et al., Prices in Colonial Pennsylvania (Philadelphia: University of Pennsylvania Press, 1935), pp. 422 and 432CrossRefGoogle Scholar, respectively. Amsterdam prices of Virginia leaf tobacco are given in Posthumus, N. W., Inquiry into the History of Prices in Holland, (Leiden: E. J. Brill, 1946), I, pp. 202–03.Google Scholar Rates of exchange between schellingen and English sterling are given in ibid., pp. 597–602, for the years 1722–72; 20 schellingen equalled 6 guilden (ibid., p. LIV).

²⁶ Walton, Gary M., “Sources of Productivity Change in American Colonial Shipping, 1675–1775,” The Economic History Review, Second Series, XX, 1 (April, 1967), 67–78CrossRefGoogle Scholar; Walton, , “A Measure of Productivity Change in American Colonial Shipping,” The Economic History Review, Second Series, XXI , 2 (Aug. 1968), 268–82Google Scholar; and Walton, , “Obstacles to Technical Diffusion in Colonial Shipping, 1675–1775,” Explorations in Economic History, VIII, 2 (Winter, 1970–1971), 123–40.CrossRefGoogle Scholar

²⁷ We do not mean to imply that no other factors contributed to economic growth in the colonies. A growing stock of capital was undoubtedly an important source of growth, but our concern here has been with possible sources of productivity increase. With regard to productivity, one might wonder about the contribution of increasing specialization in view of the above estimates of per capita exports, which were roughly stable over the first 75 years of the eighteenth century (without additional information about the extent of market trade, and knowledge of the production functions for colonial products, it is impossible to say anything more). We do think, nevertheless, that the evidence supports our contention that improvements in distribution made an important contribution to growth. Take, for instance, a hypothetical example (and we stress hypothetical). Suppose the annual average rate of growth of per capita output from 1700 to 1775 was one-half of 1 percent, and that about 25 percent of output was produced for markets. Then the required annual rate of growth in market output per capita that would have been necessary to produce this rate of growth (of per capita output) would have been 2 percent (neglecting the complexities of compound rates and assuming increased productivity occurred only in activities associated with production for markets). If one-half of this 2 percent increase in per capita market output was due to an increasing stock of capital, and one-half to increasing productivity, it seems entirely possible to us that the major share of this hypothetical 1 percent rate of growth of per capita market output (due to increasing productivity) came from improvements in distribution.