Contracted Trade in the 18th century

Question

I'm trying to get an understanding of how trade worked in the 18th century. I'm trying to learn how trade was conducted so I can make a realistic game. I'm struggling to find a good source for the questions that I have. Specifically, I'm trying to understand how trade agreements were reached. For instance, could goods be contracted for transport? If so, how did such agreements work? Was there fixed cost transportation? Percentage of cost of goods sold? Delivery on success only? Any other interesting details relating to transporting others goods, or your own goods on another person's ship?

To start with, I'm most interested in European trade, especially the British Empire, with its territories and other countries.

I'm most interested in smaller traders, not large companies.

Answer 1

Much of what you desire to know will be summed up by researching both the history of Marine Insurance, perhaps starting with the founding of Lloyd's Coffee House in about 1688; the history of the early trading companies such as

• Honourable East India Company (1600) ;

• United East Indian Company (aka Dutch East India Company) (1602) - ; and

• The Governor and Company of Adventurers Trading into Hudson's Bay (1670) ;

as well as the early banking arrangements established by Europe's key trading cities (eg Amsterdam in 1609, Hamburg in 1619, and Nuremberg in 1621) modelled after the Venetian Initiative already proven by Venice, Genoa and Barcelona.

Note that by the beginning of the 17th century all of Europe west of the Dvina-Dnieper line (at least) had a well established banking system offering Bill of Exchange (ie chequing) services and Foreign Exchange markets (also here) . Antwerp has a functioning Stock Exchange starting from 1531, and all those East India Companies were simply long-lived extensions of the limited liability concept that had long been used to finance risky maritime trade on a voyage-by-voyage basis. Somewhat coarsely, the financing which Antonio provides to Bassanio in Shakespeare's Merchant of Venice illustrates the mechanism.