Dissertation_A Bick_May 25 - DataSpace at Princeton University

they liked (save the three goods explicitly excluded) at anytime and any price they chose;
although these goods would be transported on company ships they neither belonged to the
company nor were subject to its discretion. At the same time, however, by forcing private
merchants to purchase shares, the compromise ensured that these merchants would have a stake
in the company's survival. This would better distribute the risk involved in the company's
activities in Brazil and, crucially, it would force up the value of the company's shares. From a
value of 98 in 1637, shares rose to 117 in 1638 and 134 in 1639, before beginning a long
decline. 126 This was hardly unfettered free trade in the sense used by Adam Smith, but it worked
as the solution to a complex political and economic problem.
But there was another remarkable element of the final agreement: three goods were
identified as reserved for the company. Two of these—Brazilwood, used to make dyes for the
cloth industry, and ammunition, which the company did not want falling into the hands of the
Portuguese—also had been exempted when the trade to Brazil was first opened to private
merchants in 1630. 127 The third “good,” which up to this point had never appeared in any formal
regulation or resolution by the States General, was slaves. Without fail historians always mention
that the slave trade was one of three exemptions, but the tendency has been to treat this as a
continuation of a pre-existing state of affairs. Van Dillen, for example, sums up the agreement by
saying that, “the trade in slaves, dyewoods, and ammunition remained a company monopoly.” 128
In a strict sense this is true, since the slave trade, in which the company had become involved
two years earlier, was never open to private merchants. But in a broader sense, the decision to
126
Den Heijer, De Geoctrooieerde Compagnie, 250; Van Dillen, “De West-Indische Compagnie, het Calvinism en
de Politiek,” 159.
127
Articulum ... over het Open ende Vry Stellen van den Handel en Negotie op de Stadt Olinda de Pernambuco, ende
Custen van Brasil.
128
Van Dillen, “De West-Indische Compagnie, het Calvinism en de Politiek,” 160. “Echter bleef de handel in
slaven, verfhout en ammunitie het monopolie der Compagnie.” The italics are mine.
209