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Author: Charles Jones
Editor: John J. McCusker
Date: 2006
History of World Trade Since 1450
Publisher: Gale
Document Type: Topic overview
Pages: 5
Content Level: (Level 5)
Lexile Measure: 1420L

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Empire (Latin "imperium") is an old and complex word; imperialism a quite recent and more treacherous one. At its simplest, an empire is a territory within which there is one supreme military and legal authority. By the end of the fifteenth century, empire in this strict sense was not fully achieved in Europe until the unifications of Italy (1860) and Germany (1870) swept away the petty states and overlapping jurisdictions of Central Europe and completed the division of most of the continent into large competing territorial states, marking the onset of modern "imperialism" as distinct from mere "empire." For the defining feature of imperialism is not the mere presence of empires in a state system, but the domination of that system by struggles between empires. But by the end of the fifteenth century, this very limited sense of empire was about to be vastly extended as petty European kings began to develop extensive overseas realms to rival, or even supplant, the longer established, extensive, and wealthy empires of Asia and the Americas.

Throughout the next three centuries, these European "empires" grew steadily. Struggles arising from an uneasy balance of power between the leading European states were worked out on battlefields in India and Canada; commercial disputes far from Europe renewed conflict in the heart of Europe. To thinkers of the late seventeenth and early eighteenth centuries the close interaction of state power and commercial interest became known as mercantilism. Under this system European powers tried to maintain their empires as exclusive trading zones. In the later eighteenth century mercantilism came under attack. Liberals argued that the public interest would be better served by a much more restricted use of state power, at home and abroad, allowing unrestricted access to and operation of markets, including free trade between nations. War and conquest were disparaged as exploitative activities associated with hereditary aristocracies and monarchies; the future lay with the more peaceable middle classes.


It is important to draw a distinction between the history of thought and the pattern of mundane events. Imperialism is a term closely associated with the revival of enthusiasm for empire in the late nineteenth century; it describes a popular sentiment. Yet it is also a descriptive term, implicated in interpretations of history that accept and proceed to account for an accelerated pace of European expansion around this time. British historians of the second half of the twentieth century therefore readily assumed that the classic theorists of imperialism, who had written between 1900 and 1920, must have been trying to explain a spurt in the growth of colonial empires. This assumption was made without first clarifying whether accelerated growth had in fact been the leading feature of what contemporaries named the New Imperialism of the 1880s, let alone whether this had been what the classic theorists had been primarily concerned with explaining.

Regarding the first of these issues, there may well have been aversion to the idea of empire in the salons of Europe following the defeat of the French in India and Canada and the successful American wars of independence waged by colonists against Britain and Spain. Yet, there is little sign of it on the ground. After the FrenchPage 370  |  Top of Article

Colonial Possessions of European States in 1530. MAP BY XNR PRODUCTIONS. THE GALE GROUP
Revolution the French compensated by attempting to recreate a vast empire in and beyond Europe, which was not entirely extinguished by the defeat of Napoleon. The conquest of what was to be an immense African empire began with the invasion of Algeria in 1830. Meanwhile, massive conquests were being made by other European powers and their successor states throughout the nineteenth century. So it can certainly be argued that there was continuous imperial expansion by Europeans throughout what has often been referred to as a liberal interlude. It is also the case that for the established powers, the territories acquired before 1870 were of greater economic salience than those acquired afterward, and that, for Britain, trade and investment outside the British Empire, chiefly in the United States and Latin America, were far more important than post-1870 conquests in Africa and Asia.

Far from disposing of the New Imperialism, this interpretation helps to isolate its essential feature more clearly. Expansion in the earlier period had led to relatively little conflict between the major powers, which indeed enjoyed a period of relative peace between 1815 and 1870. All this changed after 1870. It was the conflicts between the imperial powers rather than expansionism itself that defined the New Imperialism and provided the focus of the classic theories. So although colonial historians can be forgiven for pointing to the European partition of Africa—which was almost entirely gobbled up by seven European states in a mere twenty years—as the most spectacular symptom of imperialism, its most fundamental characteristic in this period was not expansion per se, but the rivalries that developed between the major powers.

New states had after 1870 entered the rivalry; Belgium, Italy, and Germany jostled with newly assertive powers, such as the United States of America and reformed and modernizing Japan, to test British hegemony. British manufacturing and commercial supremacy was on the wane, challenged most effectively by Germany and the United States. A second industrial revolution was under way, based on steel, petroleum, electricity, and synthetic chemicals, and this created fresh anxieties about the security of supplies of raw materials. With industrialization in Europe came urbanization, bringing a growing need for imported foodstuffs and concerns about the effects of internal migration on social and political order. Even in Britain, which had pursued a policy of free trade since 1846, pressure was building by the 1890s for tariff reform, by which was meant a system of preferential trading within the British Empire. Other powers were less squeamish, and ran their empires as un-ashamedly economic units.

At the same time, the effect of new transport and communications technologies—submarine telegraphy,Page 371  |  Top of Article

Colonial Possessions of European States in 1648. MAP BY XNR PRODUCTIONS. THE GALE GROUP
railroads, and regular steamship lines—had been to bind together the empires that adopted them and, almost unavoidably, to degrade links between their respective dependencies. Moreover, all these developments first required, yet subsequently also generated, enormous accumulations of capital as well as new financial intermediaries, institutions, and forms of asset. Investment of this capital overseas in infrastructure and, later, in the extractive and manufacturing sectors—above all by the British, but also by the French and other Europeans—was the means by which the global trading system was modernized, expanded, and, up to a point, integrated. Without it, world trade could not have risen at the astonishing rate and to the unprecedented level, relative to output, that it attained shortly before World War I. So it is no wonder that some theorists and historians have pondered the connections between trade, investment, and empire. Did trade follow the flag, or vice versa?


It is important to recognize that the reflections upon this state of affairs by J. A. Hobson (1858–1940), Joseph Schumpeter (1883–1950), and V. I. Lenin (1870–1924)—each of whom tried to provide a general theory of imperialism in the early twentieth century—were not motivated by concern for the downtrodden masses of the world's poorest countries. Their political constituencies were the middle and working classes of Europe; their central task was to explain deteriorating relations and, finally, war, between the Great Powers (Britain, Germany, France, Austria-Hungary, and Russia). For the liberal thinkers Hobson and Schumpeter this posed a problem, because liberals had long regarded capitalism as a pacific influence. They overcame this difficulty by arguing that it was not capitalism as such but rather its incompleteness or corruption that had brought about catastrophe. Reform was possible. Lenin, by contrast, thought that conflict among capitalist states was inevitable. Lenin, arguing against fellow Marxist Karl Kautsky, was concerned with explaining why the European working class in 1914 had supported a war so plainly against their collective interest. He found his answer in the resources available to metropolitan states from their colonial empires with which, in effect, they bribed the workers. But unlike his liberal contemporaries, Lenin neither saw nor wanted to see any possibility of reform, anticipating instead that imperialism (which he described as the "Highest Stage of Capitalism") must lead to the destruction of the capitalist state system and herald the revolution.

Hobson, writing in England in the shadow of the South African (Boer) War (1899–1902), based his argument on what he regarded as a generic problem of industrialized economies. Unrestricted capitalism, he believed, had led to impoverishment of the working class and consequentPage 372  |  Top of Article

Colonial Possessions of European States in 1783. MAP BY XNR PRODUCTIONS. THE GALE GROUP
underconsumption. Markets did not clear, as predicted by the classical economists. Instead, goods and capital accumulated in the hands of uncompetitive manufacturers and investment bankers, who lobbied government for exclusive access to overseas markets in which these surpluses could be dumped or deployed. Hobson argued that only macroeconomic management and redistributive fiscal policies—what might be called compensatory or welfare liberalism—could reduce this lobbying pressure and allow foreign policy to be formulated in response to national rather than sectional interest. The chief problem with Hobson's theory was the empirical implausibility of the alleged lobbying system. Extensive recent scholarship suggests that manipulation of the state by sectional interests was not that simple, and that concentration of overseas investment and trade in dependent territories, and the desire to achieve this, were least marked in the longer established industrial economies, such as Britain, France, and Belgium.

The Austrian Schumpeter had been thinking along similar lines. Defining imperialism as an objectless disposition on the part of the state toward violence (no reference here to colonies!), he laid the blame squarely on the aristocracy, whose militarism he regarded as a social atavism. For several generations writers as disparate as Thomas Paine (1737–1809) and Immanuel Kant (1724–1804) had agreed that the dependence of a warmongering aristocracy on industrial and commercial wealth and technology would inevitably lead to a transfer of power to the more representative and pacific middle classes, and therefore to less violent relations between states. Schum-peter accepted this theory and argued that where there was no aristocracy, as in the United States, there could be no imperialism. (It should be noted that Schumpeter excluded from the category of imperialism any war, however aggressive, undertaken for rational ends.) But he believed that in the Hapsburg Empire and other European states the capitalist revolution had been distorted as monarchs allied with the new industrial classes to curb the power of traditional aristocracies, with the undesirable consequence that certain sections of industry became heavily reliant on state procurement and greedy for tariff protection. On this foundation Schumpeter mounted an argument in which conflict between states arose from protectionism and the competitive dumping of surplus goods in third-country export markets. This was not dissimilar to Hobson's argument, and rather more plausible, given the typically more mercantilist style of late-industrializing states such as the Hapsburg Empire.

Though Lenin drew on Hobson, his core argument was very different. Lenin argued that capitalism, and the system of states in which it was embedded, was a necessarily dynamic system. It would never find equilibrium, only a limit. Lenin believed that the final stage of EuropeanPage 373  |  Top of Article territorial expansion between 1870 and 1900 had coincided with a final division of world markets. Imperialism for him did not mean colonization; it described the whole integrated and multifaceted process of expansion of the European capitalist system, of which colonialism was merely one facet, and which he believed had effectively reached its end by 1900. With no remaining unexploited markets or unclaimed territories, he maintained, the major firms and states of Europe now had no option but to turn on one another, the former seeking the support of the latter. Hence, the progressive deterioration in international relations that led to World War I (1914–1918). It is not hard to see that this argument was, if not entirely specious, then certainly premature, because it neglected the many ways in which technological innovation and the creation of new desires can spin out the process of economic growth almost indefinitely.

All three of the classic theorists, as well as their contemporaries Rudolf Hilferding, Rosa Luxemburg (1870–1919), and Nikolai Bukharin (1888–1938), had been concerned with the consequences of territorial expansion for relations with the European powers rather than with its causes. Yet, although imperialism did not end with World War I, nor even with the near completion of European decolonization by the mid-1960s, debate about it divided into two strands: one concerned with relations between imperial powers and their dependencies, and the other with the mutual relations of the Great Powers. Only in the first strand did the term imperialism retain currency.


Imperialism before 1914 had been in many ways simply a variant of nationalism. The means used to bind a nation together were not so very different from those used to bind together a multinational empire. For liberals of the mid-nineteenth century, nationalism had been quint-essentially about bringing together politically fragmented nations into larger united states, with Italy and Germany as examples. Increasingly, throughout the twentieth century, nationalism came to be pitted against imperialism, as component elements of empires—whether Quebec, Catalonia, or Scotland—sought self-determination or autonomy. Increasingly, therefore, imperialist came to be used, almost exclusively by the political Left, to designate those who sought to gain or retain control over dependent states by any form of interference, be it armed intervention, economic manipulation, or mere inertia.


Cain, P. J., and Hopkins, A. G. British Imperialism, 1688– 2000, 2nd edition. Harlow, U.K.: Longman, 2002.

Hobson, J. A. Imperialism: A Study. London: George Allen and Unwin, 1902.

Schumpeter, Joseph A. Imperialism and Social Classes. [1917]. Tr. Heinz Norden, ed. and intro. Paul M. Sweezy. Oxford, U.K.: Oxford University Press, 1951.

Lenin, V. I. Imperialism, the Highest Stage of Capitalism. [1917]. New York: International Publishers, 1939.

Luxemburg, Rosa, and Bukharin, Nikolai. Imperialism and the Accumulation of Capital. [1915, 1924]. Ed. and intro. Kenneth J. Tarbuck, tr. Rudolf Wichmann. London: Allen Lane, Penguin, 1972.

Hilferding, Rudolf. Finance Capitalism: A Study of the Latest Phase of Capitalist Development. [1910]. Ed. and intro. Tom Bottomore, tr. Morris Watnick and Sam Gordon. London: Routledge and Kegan Paul, 1981.

Charles Jones

Source Citation

Source Citation   (MLA 8th Edition)
Jones, Charles. "Imperialism." History of World Trade Since 1450, edited by John J. McCusker, vol. 1, Macmillan Reference USA, 2006, pp. 369-373. Gale Ebooks, Accessed 18 Oct. 2019.

Gale Document Number: GALE|CX3447600217

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  • Capitalism,
    • imperialism,
      • 1: 371-372
  • Hobson, J. A.,
  • Imperialism,
  • Industrialization,
    • imperialism,
      • 1: 370
  • Information and communications,
    • imperialism,
      • 1: 370-371
  • Lenin, Vladimir
  • Mercantilism,
    • imperialism,
      • 1: 369
      • 1: 372
  • New Imperialism,
    • 1: 369-371
  • Schumpeter, Joseph,