Presentation on theme: "Economy under British Rule (1760-1867). New trade partners Britain also follows the economic policy of mercantilism. Quebec and 13 Colonies provide natural."— Presentation transcript:
New trade partners Britain also follows the economic policy of mercantilism. Quebec and 13 Colonies provide natural resources to Britain, who sells back finished products to the colonies. Great Britain tried to only buy resources from within its Empire (protectionism) and gave preferential tariffs to British products (less tax on British products) Small number of British merchants dominate trade over Canadien merchants because of their connections to government.
The fur trade and forest resources There is intense competition between companies to control the fur trade. By the the 1820s though, demand for fur in Europe had dropped. Increase production in the timber trade disrupted fur hunting grounds as well. The timber trade takes over as the main economic activity of the colony. Farmers start to work in timber yards during the winter. The timber trade also encouraged colonization of new areas like the Outaouais and Saguenay.
Agriculture Agriculture was still the populations main economic activity. Most families operated a family farm that fed themselves and surpluses were sold in the market. At first, most most farmers grew wheat, but by the 1830s and 1840s a larger number of different types of crops were being grown.
The adoption of free trade and financial institutions In the 19 th century, many merchants pressured the British parliament to give up the economic theory of protectionism and mercantilism, and embrace the economic theory of free trade. Free Trade: getting rid of tariffs and custom duties on imports and exports between participating countries. For Canada, this meant that its products had to compete internationally and its main trading partner would be the US instead of Britain.
The adoption of free trade and financial institutions This new economic situation created a great opportunity for British and American merchants to invest in new industries. To do that, they needed capital. Merchants merged their money together to form financial institutions like the Bank of Montreal (1858) which could lend out money for capital investments in building new industries. Canadian society will now be divided into two groups; those who own businesses and have access to capital and those that work for wages.
First Phase of Industrialization During the 1850s, Canada begins to experience its first phase of industrialization. Elite merchants in Canadian society also occupied positions in the colonial government. They used their position to have the government use public money to build infrastructure like canals and railroads that would help connect their industries to main ports. (Ex: Lachine Canal) This time period also saw the creation of factories in urban centers like Montreal and Toronto. It also meant that more people were now living in cities (urbanization)