Scotland in The Early Modern Era - Economy

Economy

At the beginning of the era, with difficult terrain, poor roads and methods of transport there was little trade between different areas of the country and most settlements depended on what was produced locally, often with very little in reserve in bad years. Most farming was based on the lowland farmtoun or highland baile, settlements of a handful of families that jointly farmed an area notionally suitable for two or three plough teams, allocated in run rigs to tenant farmers. They usually ran downhill so that they included both wet and dry land, helping to offset the problems of extreme weather conditions. Most ploughing was done with a heavy wooden plough with an iron coulter, pulled by oxen, which were more effective and cheaper to feed than horses. From the mid-sixteenth century, Scotland experienced a decline in demand for exports of cloth and wool to the continent. Scots responded by selling larger quantities of traditional goods, increasing the output of salt, herring and coal. The late sixteenth century was an era of economic distress, probably exacerbated by increasing taxation and the devaluation of the currency. In 1582 a pound of silver produced 640 shillings, but in 1601 it was 960 and the exchange rate with England was £6 Scots to £1 sterling in 1565, but by 1601 it had fallen to £12. Wages rose rapidly, by between four or five times between 1560 and the end of the century, but failed to keep pace with inflation. This situation was punctuated by frequent harvest failures, with almost half the years in the second half of the sixteenth century seeing local or national scarcity, necessitating the shipping of large quantities of grain from the Baltic. Distress was exacerbated by outbreaks of plague, with major epidemics in the periods 1584-8 and 1597-1609. There were the beginnings of industrial manufacture in this period, often utilising expertise from the continent, which included a failed attempt to use Flemings to teach new techniques in the developing cloth industry in the north-east, but more successful in bringing a Venetian to help develop a native glass blowing industry. George Bruce used German techniques to solve the drainage problems of his coal mine at Culross. In 1596 the Society of Brewers was established in Edinburgh and the importing of English hops allowed the brewing of Scottish beer.

In the early seventeenth century famine was relatively common, with four periods of famine prices between 1620 and 1625. The invasions of the 1640s had a profound impact on the Scottish economy, with the destruction of crops and the disruption of markets resulting in some of the most rapid price rises of the century. Under the Commonwealth, the country was relatively highly taxed, but gained access to English markets. After the Restoration the formal frontier with England was re-established, along with its customs duties. Economic conditions were generally favourable from 1660 to 1688, as land owners promoted better tillage and cattle-raising. The monopoly of royal burghs over foreign trade was partially ended by and Act of 1672, leaving them with the old luxuries of wines, silk, spices and dyes and opening up trade of increasingly significant salt, coal, corn and hides and imports from the Americas. The English Navigation Acts limited the ability of the Scots to engage in what would have been lucrative trading with England's growing colonies, but these were often circumvented, with Glasgow becoming an increasingly important commercial centre, opening up trade with the American colonies: importing sugar from the West Indies and tobacco from Virginia and Maryland. Exports across the Atlantic included linen, woollen goods, coal and grindstones. The English protective tariffs on salt and cattle were harder to disregard and probably placed greater limitations on the Scottish economy, despite attempts of the King to have it overturned. However, by the end of the century the drovers roads, stretching down from the Highlands through south-west Scotland to north-east England, had become firmly established. Scottish attempts to counter this with tariffs of their own, were largely unsuccessful as Scotland had relatively few vital exports to protect. Attempts by the Privy Council to build up luxury industries in cloth mills, soap works, sugar boiling houses, gunpowder and paper works, proved largely unsuccessful. The famines of the 1690s were seen as particularly severe, partly because famine had become relatively rare in the second half of the seventeenth century, with only one year of dearth (in 1674) and the shortages of the 1690s would be the last of their kind.

At the union of 1707 England had about five times the population of Scotland, and about 36 times as much wealth, however, Scotland began to experience the beginnings of economic expansion that would begin to allow it to close this gap. Contacts with England led to a conscious attempt to improve agriculture among the gentry and nobility. Haymaking was introduced along with the English plough and foreign grasses, the sowing of rye grass and clover. Turnips and cabbages were introduced, lands enclosed and marshes drained, lime was put down, roads built and woods planted. Drilling and sowing and crop rotation were introduced. The introduction of the potato to Scotland in 1739 greatly improved the diet of the peasantry. Enclosures began to displace the runrig system and free pasture. The Society of Improvers was founded in 1723, including in its 300 members dukes, earls, lairds and landlords. The Lothians became a major centre of grain, Ayrshire of cattle breading and the borders of sheep. However, although some estate holders improved the quality of life of their displaced workers, enclosures led to unemployment and forced migrations to the burghs or abroad.

The major change in international trade was the rapid expansion of the Americas as a market. Glasgow supplied the colonies with cloth, iron farming implements and tools, glass and leather goods. Initially relying on hired ships, by 1736 it had 67 of its own, a third of which were trading with the New World. Glasgow emerged as the focus of the tobacco trade, re-exporting particularly to France. The merchants dealing in this lucrative business became the wealthy tobacco lords, who dominated the city for most of the century. Other burghs also benefited. Greenock enlarged its port in 1710 and sent its first ship to the Americas in 1719, but was soon playing a major part in importing sugar and rum. Cloth manufacture was largely domestic. Rough plaids were produced, but the most important areas of manufacturing was linen, particularly in the Lowlands, with some commentators suggesting that Scottish flax was superior to Dutch. The Scottish members of parliament managed to see off an attempt to impose an export duty on linen and from 1727 it received subsidies of £2,750 a year for six years, resulting in a considerable expansion of the trade. Paisley adopted Dutch methods and became a major centre of production. Glasgow manufactured for the export trade, which doubled between 1725 and 1738. The move of the British Linen Company in 1746 into advancing cash credits also stimulated production. The trade was soon being managed by "manufacturers" who supplied flax to spinners, bought back the yarn and then supplied to the weavers and then bought the cloth they produced and resold that. Banking also developed in this period. The Bank of Scotland, founded in 1695 was suspected of Jacobite sympathies and so a rival Royal Bank of Scotland was founded in 1727. Local banks began to be established in burghs like Glasgow and Ayr. These would make capital available for business and the improvement of roads and trade.