From guilds to the home workshop
The guilds, crippled by medieval rules, kept losing their markets in an age whose watchwords were individual independence and invention. Shrewd merchants gathered capital, bought raw materials, distributed them among shops and families, collected the product and sold it as far as transport and trade allowed. Capitalism in England began at home. Father, mother, daughter and son worked for contractors, and so arose the domestic system that lasted until the late eighteenth century. Nearly every house became a small factory where women spun and wove linen and wool, sewed and embroidered, made medicines from herbs and put up wine, and almost managed to create an English art of cookery.
The state as supervisor
Elizabeth's government, which legislated religion with such zeal, also supervised economic life. Finding the strict rules of the towns an obstacle to trade and industry, it replaced local regulation with national rules. The Statute of Artificers (1563) created an elaborate code of state control that lasted until 1815. Meant to prevent idleness, it required every able young man to serve a seven-year apprenticeship, since until twenty-three a man is often, though not always, wild and lacking judgment and experience. A youth under thirty who stayed idle by choice without earning forty shillings a year could be compelled to take work, and in villages every healthy person under sixty had to join the harvest. Workers had to sign yearly contracts for guaranteed pay. Justices of the peace were empowered to set minimum and maximum wages in their districts, and London laborers were fixed at nine pence a day, according to the book. Employers who dismissed workers without cause were fined forty shillings, and workers who quit without cause were jailed. No worker could leave without permission of employer and magistrate, and workers had to labor twelve hours in summer and through the daylight hours in winter. Strikes were forbidden and strikers were jailed or fined.
On the whole the law protected employers against workers, farming at the expense of industry, and the state against social revolution. The preface to one guild's rules consoled readers that men are by nature equal and made by one workman from one clay. Nobody believed this less than Cecil and Elizabeth, and Cecil may have ordered the 1563 code himself.
Poverty and the poor laws
The result was that poverty became obligatory for the working class. The law was meant to match wages to the price of necessities, but the justices charged with this were all employers. Wages rose, but far more slowly than prices. Between 1580 and 1640, the book says, the cost of living doubled while wages rose twenty percent, and from 1550 to 1650 artisans and laborers grew steadily worse off.
London's outskirts filled with a poor and often criminal class living in squalid rented houses, and some districts lived on begging and theft. At the funeral of the Earl of Shrewsbury in 1591, about twenty thousand beggars, the book says, asked for food. The government passed harsh laws against begging but also a series of more humane Poor Laws (1563 to 1601) that recognized the state's duty to keep people from starving. A poor rate was levied in every parish to help the unemployed, and the able-bodied were put to work.
Prices, bad money and monopolies
Rising prices encouraged trade and industry but ruined the poor. The chief causes were European silver mining, the influx of precious metals from America and the debasement of coinage by governments. According to the book, European mining and American imports of silver were worth the equivalent of 150 million dollars from 1501 to 1544 and about 900 million from 1545 to 1600, in 1957 terms. Elizabeth struggled honorably against debasement. She heeded the counsel of her shrewd adviser Sir Thomas Gresham, who warned in 1560 that bad money drives out good, because people hoard or export true coin and spend the base kind on taxes and the like. This is Gresham's Law. With Cecil's help she repaired the coinage debased under her father and brother and restored the gold and silver content. Prices still rose, because the minting and circulation of coin outran the production of goods.
Monopolies also pushed up prices. Elizabeth granted exclusive rights to produce or sell iron, oil, vinegar, coal, lead, saltpeter, starch, twisted thread, hides, leather and glass. She meant to encourage capitalists to import goods and found industries, and sometimes to reward officials whose posts paid too little. When protest erupted in Parliament, she agreed in 1601 to suspend them pending inquiry into abuses. Some stayed in force.
Fairs, roads and inns
Domestic trade, tangled in restrictions, grew more slowly than foreign trade. No one could sell goods in a town where he did not live except at its trade fair. Such fairs were held in many towns, five or six hundred a year, and the most famous was Bartholomew Fair, held every August near London, which added a circus to draw crowds. Goods traveled mostly by water, and the rivers were full of vessels. Roads were bad but improving, and travelers could cover about a hundred miles a day. The messenger carrying news of Elizabeth's death to Edinburgh covered 260 kilometers on his first day. The post, founded in 1517, served only the government, so private letters went by messengers, ambassadors or travelers. Most journeys were on horseback. Coaches appeared around 1564 and were a luxury for a few until 1600, but by 1634 there were so many that the government had to bar private coaches to relieve the crowded roads. Inns on the roads were good, but travelers had to guard their purses and conceal their destinations. People had to stay wary and alert.
Mercantilism and the trading companies
As industry developed, foreign trade flourished. Exporting manufactures paid for Eastern luxuries and raw materials. The market grew from local to national to European and reached Asia and America, and the power and activity of states grew with trade. England, like France and Spain, wanted to export goods and import gold, since under mercantilism a nation's wealth was measured by its precious metals. Francis Bacon seems to have been first to speak of a favorable balance of trade, meaning exports above imports and hence a gain in gold and silver. Cecil said his aim in all policy was to avoid use of unnecessary goods. He knew gold and silver could not be eaten or worn but saw them as international money that could buy anything in need, even the alliance of enemies. National industries were protected in peace so that in war the nation need not rely on foreign products, so governments used customs duties against imports and bounties to encourage exports.
Trading companies were founded to sell English goods abroad. The Merchant Adventurers opened a market in Hamburg. Anthony Jenkinson led trading missions to Russia (1557) and Persia (1562). Another mission went to India (1583 to 1591), the Turkey Company was founded in 1581, the Muscovy Company in 1595 according to the book, and the East India Company on 31 December 1600. The ground was prepared for Hastings and Clive. Men who loved the sea or money sailed in search of new trade routes, and geography was partly a by-product of their enthusiasm. The search for markets and colonies stimulated shipbuilding, and England's forests became masts and hulls. Britain began to rule the waves, and an empire, in name and fact, took shape.