From Silver to Cocaine: Latin American Commodity Chains and the Building of the World Economy, 1500–2000

385 Pages·2006·2.441 MB·English

by  Steven Topik, Carlos Marichal, Zephyr Frank

from silver to cocaine
american encounters/global interactions
A Series Edited by Gilbert M. Joseph and Emily S. Rosenberg
This series aims to stimulate critical perspectives and fresh interpretive frame-
works for scholarship on the history of the imposing global presence of the
United States. Its primary concerns include the deployment and contestation of
power, the construction and deconstruction of cultural and political borders,
the fluid meanings of intercultural encounters, and the complex interplay be-
tween the global and the local. American Encounters seeks to strengthen di-
alogue and collaboration between historians of U.S. international relations and
area studies specialists.
The series encourages scholarship based on multi-archival historical re-
search. At the same time, it supports a recognition of the representational
character of all stories about the past and promotes critical inquiry into issues of
subjectivity and narrative. In the process, American Encounters strives to under-
stand the context in which meanings related to nations, cultures, and political
economy are continually produced, challenged, and reshaped.
F R O M S I L V E R
T O C O C A I N E
Latin American Commodity Chains and the
Building of the World Economy, 1500–2000
Edited by Steven Topik, Carlos Marichal, and Zephyr Frank
duke university press
Durham and London 2006
∫ 2006 Duke University Press
All rights reserved
Printed in the United States of America on acid-free paper $
Designed by Jennifer Hill
Typeset in Quadraat by Keystone Typesetting, Inc.
Library of Congress Cataloging-in-Publication Data
appear on the last printed page of this book.
Duke University Press gratefully acknowledges the support of the
Stanford School of Humanities and Sciences, which provided funds
toward the production of this book.
contents
introduction
Commodity Chains in Theory and in Latin American History ∞
Steven Topik, Carlos Marichal, and Zephyr Frank
∞ The Spanish-American Silver Peso: ≤∑
Export Commodity and Global Money
of the Ancien Regime, 1550–1800 Carlos Marichal
≤ Indigo Commodity Chains in the Spanish ∑≥
and British Empires, 1560–1860 David McCreery
≥ Mexican Cochineal and the European Demand π∏
for American Dyes, 1550–1850 Carlos Marichal
∂ Colonial Tobacco: Key Commodity Ω≥
of the Spanish Empire, 1500–1800 Laura Nater
∑ The Latin American Co√ee Commodity Chain: ∞∞∫
Brazil and Costa Rica Steven Topik and Mario Samper
∏ Trade Regimes and the International ∞∂π
Sugar Market, 1850–1980: Protectionism,
Subsidies, and Regulation Horacio Crespo
π The Local and the Global: Internal ∞π∂
and External Factors in the Development
of Bahia’s Cacao Sector Mary Ann Mahony
∫ Banana Boats and Baby Food: The Banana in U.S. History ≤≠∂
Marcelo Bucheli and Ian Read
Ω The Fertilizer Commodity Chains: ≤≤∫
Guano and Nitrate, 1840–1930
Rory Miller and Robert Greenhill
∞≠ Brazil in the International Rubber Trade, 1870–1930 ≤π∞
Zephyr Frank and Aldo Musacchio
∞∞ Reports of Its Demise Are Not Exaggerated: ≥≠≠
The Life and Times of Yucatecan Henequen Allen Wells
∞≤ Cocaine in Chains: The Rise and Demise ≥≤∞
of a Global Commodity, 1860–1950 Paul Gootenberg
conclusion
Commodity Chains and Globalization in Historical Perspective ≥∑≤
Carlos Marichal, Steven Topik, and Zephyr Frank
contributors ≥∏∞
index ≥∏∑

introduction
Commodity Chains in Theory
and in Latin American History
Steven Topik, Carlos Marichal,
and Zephyr Frank
latin america has been actively engaged in global trade
since a Genoese sailor with Portuguese cartographic and navi-
gational skills and experience sailing to Africa on Spanish
ships partially financed by Italian bankers reached what would be known
as the ‘‘New World.’’∞ A German named the new continent America, after
a Florentine who wrote in Latin. Although today many observers of the
world economy are fascinated by a package of transformations known
as ‘‘globalization,’’ which they think was born in the post–Washington
Consensus era as a result of the application of new rules on trade and
finance, this volume stresses that forms of globalization have long ex-
isted. In fact, many students of international trade date the beginning of
the world economy to 1492 with the incorporation of the Americas.≤ Marx
and Engels eloquently noted this a century and a half ago: ‘‘The discovery
of America, the rounding of the Cape, opened up fresh ground for the
rising bourgeoisie. The East-Indian and Chinese markets, the colonisa-
tion of America [north and south], trade with the colonies, . . . gave to
commerce, to navigation, to industry, an impulse never before known.’’≥
In contrast, researchers of a modern school date the intensification of
global trade and price convergence to the last quarter of the nineteenth
century.∂ Still others argue that, despite antecedents, the true age of glob-
alization is actually the contemporary era.∑ In any case, it is clear that the
growing integration of the world economy has deep roots in history.
The essays in this volume explore the numerous and changing connec-
tions of Latin America with the rest of the world by looking at the complex
networks of commodity trade and the chains that were created between
producers and consumers over five centuries: some commodity chains,
such as those of silver, sugar, and tobacco, began in the sixteenth century;
those of others, such as bananas and rubber, started only at the end of the
nineteenth century, and cocaine came into its own in the twentieth. Our
studies are distinctive not only because we examine in detail the trajecto-
ries of twelve significant commodities that prospered at di√erent times in
the last five hundred years, but also because we use a commodity chain
approach to investigate the relationships between producers, intermedi-
aries, and consumers. Unlike some studies that concentrate on where—in
which country or continent—in the chain the surplus is accumulated, we
are also interested in the social and political consequences on both ends
of the chain. And rather than pay attention primarily to the strategies of
global firms, we are equally interested in the many other participants in
the production, processing, and marketing of commodities.
We focus on the production of most of the important export goods
within Latin America but then move on to follow the commodities to their
domestic Latin American as well as European, North American, and
Asian markets. This approach is consonant with a new and vigorous
trend in world economic history which has focused attention on chang-
ing patterns of consumption over time and recognizes that value is cre-
ated in the consumption and commercial spheres as well as in produc-
tion. This expansive view allows for a more complete understanding of
the full circle of supply and demand of many of the principal goods that
human beings produce and consume.∏
The idea that Latin America has been profoundly shaped by its rela-
tionship with the global economy is of long standing and well accepted.π
But the nature and consequences of that relationship have been stren-
uously debated. Early on in Europeans’ colonization of the Americas,
mercantilist views prevailed.∫ The accumulation of natural resources, es-
pecially precious metals such as silver and gold, defined wealth. Invest-
ment of capital in technology, especially manufacturing, and increasing
the employment level in these agrarian states was considered secondary.
A complementary axiom was that the main purpose of colonies was to
enrich the Iberian metropolises. Hence the imperial states of Spain and
Portugal played central roles in directing their colonies’ economies. They
attempted to constrain colonial commerce through royal monopolies,
≤ steven topik, carlos marichal, zephyr frank
regulations, and licenses in order to ensure control of commodity trade
and fend o√ their English, French, and Dutch rivals. It is manifest that the
welfare of the colonial subjects was considered less important than the
benefits that accrued to the imperial centers.
Recent research, however, shows that Latin American producers were
much more than simple marionettes set to dance by overseas commands
and demands. They were not simply passive victims.Ω Often they played
enterprising, defining, and even controlling roles. We do not assume that
European players constituted the metropolis while Latin Americans were
peripheral or semiperipheral. The chains were dynamic and the partici-
pants often changing. Mexican and Peruvian silver miners as well as
Brazilian and Caribbean sugar growers applied some of the most ad-
vanced technologies to create some of the largest, most integrated man-
ufactories of the world in the sixteenth to the eighteenth centuries, gener-
ating what were then several of the most valuable internationally traded
commodities.
Silver and sugar bound together Europe, the Americas, Africa, and
Asia, thereby fueling early globalization. This era is witnessed in our
volume by four chapters on colonial exports and their international trajec-
tories: Carlos Marichal writes on silver, which was not only a precious
commodity but also the most widely used money of the ancien regime;
David McCreery studies indigo and explains three competing chains of
the most widely used dye in the world textile industry; Marichal adds a
complementary essay on cochineal, the most expensive colonial dye; and
Laura Nater analyzes the production and trade of tobacco in colonial
Cuba. Generally speaking, the production and commerce of these valu-
able goods was more closely regulated by the Spanish crown than the
commodity trade of other, rival European empires. In each of these cases,
the leading export commodities from Spanish America were essentially
luxury goods demanded by aristocrats, merchants, and political and ec-
clesiastical elites of ancien regime societies both in the Americas and
in Europe.
With the rise of the Industrial Revolution and expanded long-distance
trade, the liberal free trade theories of Adam Smith, David Ricardo, and
Jean-Baptiste Say became popular. Mechanization of production and
transportation as well as expanded use of steam, wind, and water power
led to a new calculus of profitability. Rather than sell a little for a high
price under the controlled markets of the mercantilist era, producers now
found it more profitable to sell a lot for the low prices now possible, and
introduction ≥