March 07, 2003

THE PILE Grows Ever Higher

THE PILE grows ever higher. Yet another book to go into the "to read very soon" pile.


Rene J. Barendse (2002), The Arabian Seas: The Indian Ocean World of the Seventeenth Century. Armonk, NY: M.E. Sharpe, 2002. xvi + 589 pp. $85 (hardcover), ISBN: 0-7656-0728-x; $34.95 (paperback), ISBN: 0-7656-0729-8.

Reviewed for EH.NET by Alan Heston, Departments of Economics and South Asia Regional Studies, University of Pennsylvania. <>

This is an extremely rewarding book to read, but not at one sitting. It is quite long, focusing on one century of transport, finance, business practices and commerce in the economic center of the world at the time, the seas from the Ottoman to Mughal Empires. The command of detail that Barendse displays is impressive. The extensive use of Dutch, Portuguese and French materials provides a very rich base for his study, as these include many translations of Arabic materials. Begun as a dissertation in 1985, published in Dutch in 1998, and now in English, it is a mature study that continually tries to relate its findings to other work in the field. The author, an Associate Research Fellow at the International Institute for Asian Studies in Amsterdam, provides a curious mixture of traditional scholarship combined with the vocabulary of contemporary industrial organization.

In terms of the buzzword, globalization, _The Arabian Seas_ is right there. Kirti Chaudhury conceptualized trade in Asia at the time of European incursions as involving three circles, joined at major ports that served to assemble and disperse cargoes for shipment to other Asian ports with a small percentage to Europe. In the East was Canton and Macao linked to Malacca, a circle embracing at times Japan and of course, the Spice Islands. From Malacca merchants went to Calicut or Cambay on the west coast of India, this circle also embracing Bengal and Ceylon. Some ships covered more than one circle, such as the Portuguese annual voyage from Goa to Macao, but the bulk of the shipping in volume and value was within these circles and remained that way during the seventeenth century, the focus of this book. The third circle and the major focus of this book was from Cambay or Calicut to Hormuz and the overland route through Aleppo and Damascus, and to Aden and the Red Sea. This third circle also provided access to silk route goods at a number of points.

What Barendse does very nicely is document the fourth and fifth circles that took in the trade on the East Coast of Africa and linked that to the West Coast and the Caribbean and the Americas either directly or through Europe. The fifth circle had its own independent relationships with Europe through the trade of Spain with the Americas, with links to the fourth circle through several common commodities including textiles, coffee and silver. Barendse does not attempt any treatment of the world-closing circle from the Spanish Pacific ports to Manila, Formosa and Macao; his story is full enough as is.

The book begins with a tour of the terrain providing some maps, though still more would have been useful. The maps are informative though not well reproduced. In Chapter 3 Barendse introduces the "European _Natios_ in the Arabian Seas," intentionally rejecting diasporas as a term which he thinks does not capture the nature of relationships in the seventeenth century. It is doubtful his terminology will catch on, but Barendse does have a point in that there was a grouping of all Europeans in many ports. Chapter 4 "Diplomacy and the State," deals with the very different relationships of merchants and rulers prevailing in Europe compared to those in the Arabian Seas, which in turn varied greatly among different states. In Chapter 3 and later in his treatment of the Dutch, Barendse makes clear the tension between the perception of the Atlantic Ocean as _mare liberum_ where all vessels are free to trade in times of peace and the perception in other seas. The Dutch East India Company (VOC), though nominally under Dutch authority, was clearly a state in Asia and asserted _mare clausum_ not only around the Spice Islands but also in parts of the Indian Ocean. This took the form of issuing, upon payment of a fee, _navicerts_, which like the Portuguese _cartaz_ was a safe passage certificate.

Chapter 5 on the "Merchants' World," is one of the most interesting in the book. A large section is devoted to information, and though Barendse does not seem enamored by the concepts of agency or information asymmetry, they are very much up front in the way he describes the world of trade. He tells us of "bazaar walkers" who spent their days collecting price information in markets like Surat, in order to know both whether there was a probable return on trading an item, but also the risk as indicated by the extent of price fluctuations in various markets. The price information was then conveyed back to Europe or other relevant locations. And Barendse describes the attempts to mail or courier this and other information overland through the Ottoman Empire domains so as to avoid the cost in time by ship around the Cape. Needless to say the opportunities for undermining the competition were immense as were the temptations of agents to switch masters. Further, the very current notion of dis-information was a common way to divert potential competitors from direct access to suppliers or buyers, e.g., Egyptian traders embellishing the dangers to Europeans of being eaten alive along the routes to interior markets in Ethiopia.

The book includes separate chapters on the Portuguese, Dutch and British experiences in the century; the Portuguese were in relative decline, the Dutch reaching their peak, and the British finally getting their act together by 1700. Barendse sees little difference between the rent-seeking behavior of the trading companies and the Portuguese; in the case of the companies, it was centrally directed and the fruits were shared with employees, while for the Portuguese, it was mostly private citizens who took advantage of their situation. Holden Furber (1976) provided similar coverage in _Rival Empires of Trade in the Orient, 1600-1800_, a book curiously absent from the extensive bibliography, even though references are made to earlier research by Furber. The two books are very complementary. Furber focuses much more on what is going on in Europe and of course, includes East Asia in the discussion. However, Furber treats trading, markets and the like in a very traditional manner while Barendse's illustrations and discussion are much more in touch with recent microeconomic concepts. It should be mentioned that neither book is very strong on the macro-world economy of money supply, prices, and currencies, though both are good on forms of commercial paper and credit.

It is hard to read the _Arabian Seas_ without learning something new about old subjects. For example, Europeans had many ships built in Asia, often because teak was more durable in warm seas. And often the ships were replicas of ships built in Europe, but not necessarily because of design; rather pirates were less likely to attack European appearing ships because retribution was more likely. Interestingly, there often was no cost advantage to building ships in Asia as opposed to Europe.

Barendse makes a good case against received views that the Dutch permitted much less private trading than the British and this reduced their innovativeness in developing new sources of supply and new markets. It is true that the British explicitly permitted private trading by company servants and the Dutch did not formally permit it. However, Barendse suggests the VOC employees carried on substantial private trade. If there was anything inhibiting trade innovations by the Dutch it is more likely due to the highly centralized administration of Asian affairs at Batavia and the obsession with monopoly in Holland. And on some matters the VOC was ahead of the times. Their armies were not composed of mercenaries but were employees of the company, unusual practice for the time. And the VOC introduced more merit into appointments than most institutions of the time, and certainly their British counterpart.

In discussing issues of agency and corruption in the companies Barendse notes that the Verenigde Oostindische Compagnie, or VOC, was often referred to as "Vergaan Onder Corruptie" (sinking under corruption). Many of the VOC outposts were so remote and removed from easy communication, that activities were hard to monitor as suggested by this quote of a supervisor in Bandar Abbas about his employee in Persia (p. 403), " I do not know what the Hon. Mr. van de Heuvel is doing at Isfahan. I believe he sleeps the whole day. Yet he has delicious roasted game, good wine and beautiful girls there, as well as healthy air, while we here, have to muddle through in such a miserable way."

Other issues dealt with in an innovative way are overhead and piracy. The VOC was a large multinational organization with 18,000 employees worldwide at its peak. They faced formidable accounting problems not only between Europe and Asia, but within Asia. How do you treat centers that primarily have a military function of facilitating Dutch trade but produce little in revenue compared to costs. The VOC simply did not have any satisfactory system to allocate overhead among its various profit centers.

Throughout the book Barendse examines piracy in its various forms, including interlopers, of whom Elihu Yale was considered the King in Madras (p. 443). A principal center where the paths of traders sanctioned by the British, Dutch, French and Portuguese crossed those of non-sanctioned traders was Madagascar. In addition to plantations there developed in Madagascar by the middle and late 1600s a very active slave trade both to Asia and the Americas. Given its strategic location Madagascar became a center for a large volume of trade of trade and commercial activity.

Beyond a wealth of detail and insights, is there a big picture that emerges? Barendse uses the term world system and clearly sees his study as contributing to that literature, though not in its more grandiose forms. Rather he presents the seventeenth century as a major period of expansion of trade between Asia and Europe and especially Africa, Brazil, the Caribbean and eventually North America. And he persuasively argues that the Arabian Seas are the crucial link area for this trade expansion, not a new idea, but one which Barendse impressively documents.

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Posted by DeLong at March 7, 2003 10:37 AM | TrackBack


I should get this book. Steensgaard's "The Asian Trade Revolution of the XVII Century" and Frederic Lane's "Venice and History" have a lot of interesting stuff about how protection costs are often the decisive factor in business, and how the Hormuz-to-Mediterranean camel caravan trade was competitive with sea trade for much longer than one would have expected.

Lane develops a whole theoretical structure, whereby military men were entrepreneurs offering a product: protection. "Negative protection" was the protection of trade against pirates; "Positive protection" was the suppression of competing trade. Trading states like Portugal, Venice, Athens, etc., practiced both. (Free-traders theoretically only practice negative protection.)

You end up concluding that pirates are specialists in negative protection only, though they can also be understood at times to be bidding for negative-protection contracts. (Looking at the relationships between pirates, privateers, bandits, robber barons, and incipient states makes this discussion seem less implausible. "Send a thief to catch a thief").

Posted by: zizka on March 7, 2003 11:27 AM

Was it Victor Hugo who wrote something like the following?

It is those books which a man possesses, but does not read, which constitute the most suspicious evidence against him.

Posted by: bob on March 7, 2003 12:50 PM

I miswrote. Here's a rewrite and amplification.

Venice, during its great age, used its military both to provide negative protection (by suppressing piracy) and positive protection (by capturing or sinking Pisan and Genoese ships; i.e., by piracy.)

England, during its great age, only offered negative protection for its free-trade empire, suppressing piracy and banditry. (The actual historical facts are probably different).

Pirates were specialists in "positive protection" (suppressing everyone else's trade without carrying on trade of their own) but could be regarded as making bids for "negative protection" jobs, i.e. facilitating trade rather than just plundering it.

It's hard to make this sound anything other than far fetched. Steensgaard also has a piece on "forced trade", which is much like pluder but not quite.

Posted by: zizka on March 7, 2003 02:44 PM

Great review -- now there's another book in my shopping cart.

Posted by: Virginia DeMarce on March 11, 2003 05:19 PM

Great review -- now there's another book in my shopping cart.

Posted by: Virginia DeMarce on March 11, 2003 05:20 PM
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