One of the biggest, most dominant allele corporations in history operated long before the egress of technical school giants like Apple or Google or Amazon. The English East India Company was incorporated by royal rent on December 31, 1600 and went on to act as a part-trade organization, part-nation-state and reap huge profits from oversea trade with India, China, Persia and Indonesia for more than two centuries. Its business flooded England with low-cost tea, cotton textiles and spices, and high rewarded its London investors with returns a high as 30 percentage. “ At its bill, the English East India Company was by far the largest pot of its kind, ” says Emily Erikson, a sociology professor at Yale University and writer of Between Monopoly and barren Trade : The English East India Company. “ It was besides larger than respective nations. It was basically the de facto emperor butterfly of large portions of India, which was one of the most productive economies in the universe at that point. ” But just when the East India Company ’ s grip on craft weakened in the recently eighteenth hundred, it found a new calling as an empire-builder. At one point, this mega corporation commanded a private united states army of 260,000 soldiers, doubly the size of the standing british army. That kind of work force was more than enough to scare off the remaining competition, suppress territory and coerce indian rulers into unilateral contracts that granted the Company lucrative tax powers.
Without the East India Company, there would be no imperial british Raj in India in the 19th and twentieth centuries. And the baseless success of the world ’ second first multinational pot helped shape the mod ball-shaped economy, for better or worse .
East India Company Founded Under Queen Elizabeth I
Officers of the british East India Company gathered in Founder ‘s Hall. Mansell/Mansell/The LIFE Picture Collection/Getty Images On the very last day of 1600, Queen Elizabeth I granted a charter to a group of London merchants for exclusive overseas trade rights with the East Indies, a massive swath of the earth extending from Africa ’ second Cape of Good Hope eastbound to Cape Horn in South America. The new English East India Company was a monopoly in the common sense that no other british subjects could legally trade in that territory, but it faced cadaver competition from the spanish and portuguese, who already had trade outposts in India, and besides the Dutch East Indies Company, founded in 1602. England, like the stay of Western Europe, had an appetite for exotic Eastern goods like spices, textiles and jewelry. But sea voyages to the East Indies were enormously bad ventures that included armed clashes with equal traders and deadly diseases like scurvy. The deathrate rate for an employee of the East India Company was a shocking 30 percentage, says Erikson. The monopoly granted by the royal lease at least protected the London merchants against domestic rival while besides guaranteeing a kickback for the Crown, which was in desperate need of funds. many of the hallmarks of the modern pot were first popularized by the East India Company. For case, the Company was the largest and longest-lasting joint stock company of its sidereal day, which means that it raised and pooled capital by selling shares to the populace. It was governed by a president of the united states, but besides a “ board of restraint ” or “ board of officers. ” Unlike nowadays ’ south relatively sedate bodied board meetings, the East India Company ’ s meetings were raucous affairs attended by hundreds of stockholders. And while the East India Company rent granted it an ostensible monopoly in India, the Company besides allowed its employees to engage in secret trade on the side. At first base, the Company didn ’ t have a set of money to pay its employees for this highly dangerous work, so it needed to provide early incentives. “ That incentive was to trade for their own private interest oversea, ” says Erikson. “ Employees of the East India Company would trade both within and outside of the rules that the Company granted. There were therefore many opportunities to fudge, darnel and smuggle. Think about jewelry, which is a very small and very expensive thing that you can hide on yourself easily. ”
East Indies Trade Fueled Consumer Culture
Before the East India Company, most clothes in England were made out of wool and designed for lastingness, not manner. But that began to change as british markets were flooded with cheap, beautifully weave cotton textiles from India, where each area of the country produced cloth in different colors and patterns. When a new radiation pattern arrived, it would on the spur of the moment become all the rage on the streets of London. “ There ’ sulfur this possibility of being ‘ in the right style ’ that hadn ’ thyroxine existed before, ” says Erikson. “ A batch of historians think this is the begin of consumer culture in England. once they brought over the cotton goods, it introduced this new volatility in what was popular. ”
In India, Trade and Politics Blend
The deal post established by the british East India Company at Surat, India, c. 1680. Universal History Archive/Getty Images When the british and early european traders arrived in India, they had to curry prefer with local rulers and kings, including the potent Mughul Empire that extended across India. evening though the East India Company was technically a private venture, its royal rent and battle-ready employees gave it political burden. indian rulers invited local anesthetic Company bosses to court, extracted bribes from them, and recruited the Company ’ mho muscle in regional war, sometimes against french or dutch trading companies. The Mughul Empire concentrated its power in the interior of India, leaving coastal cities more open to alien charm. From the begin, one of the reasons the East India Company needed indeed much pool capital was to capture and build strengthen trade outposts in port cities like Bombay, Madras and Calcutta. When the Mughul Empire collapsed in the eighteenth century, war broke out in the interior, driving more indian merchants to these company-run coastal “ mini kingdoms. ”
“ The problem was, how would the East India Company predominate these territories and by what principle ? ” says Tirthankar Roy, a professor of economic history at the London School of Economics and author of The East India company : The World ’ s Most brawny Corporation. “ A caller is not a state. A company opinion in the name of the Crown can not happen without the Crown ’ second accept. Sovereignty became a big problem. In whose name will the ship’s company devise laws ? ” The answer, in most cases, was the East India Company ’ s local branch officer. The London office of the company didn ’ t concern itself with indian politics. Roy says that vitamin a long as trade wind continued, the Board was felicitous and didn ’ metric ton interfere. Since there was identical little communication between London and the branch offices ( a letter took three months each direction ) it was left to the branch officer to write the laws governing company cities like Bombay, Madras and Calcutta, and to create local patrol forces and justice systems. This would be the equivalent of Exxon Mobil bore for oil in coastal Mexico, taking over a major Mexican city using private armed guards, and then electing a bodied middle director as the mayor, judge and executioner .
From Mercantile Company to Empire Building
Robert Clive receives from Shah Alam, the Mughal Emperor of India, a rule confer upon the East India Company the administration of the revenues of Bengal, Behar and Orissa. Hulton Archive/Getty Images A major turning point in the East India Company ’ s transformation from a profitable deal company into a full-fledged empire came after the Battle of Plassey in 1757. The battle pitted 50,000 indian soldiers under the Nawab of Bengal against barely 3,000 company men. The Nawab was angry with the Company for skirting taxes. But what the Nawab didn ’ thyroxine know was that the East India Company ’ south military drawing card in Bengal, Robert Clive, had struck a backroom deal with indian bankers so that most of the indian army refused to fight at Plassey. clive ’ south victory gave the East India Company broad tax powers in Bengal, then one of the richest provinces in India. Clive plundered the Nawab ’ mho treasure and shipped it back to London ( keeping batch for himself, of course ). Erikson sees the East India Company ’ s actions in Bengal as a seismic shift in its bodied mission. “ This wholly changes the Company ’ mho occupation model from one that had been focused on profitable deal to one that focused on tax collection, ” says Erikson. “ That ’ s when it became a in truth damage initiation, in my impression. ” In 1784, the british Parliament passed Prime Minister William Pitt ’ s “ India Act, ” which formally included the british government in opinion over the East India Company ’ randomness down holdings in India. “ When this act came into being, the Company ceased to be a very meaning craft power or a significant governing office in India, ” says Roy. “ The proper british Empire took bear. ”
The Opium Wars and the End of the East India Company
A british attack on the Canton River during the Opium War, 1840. Hulton Archive/Getty Images The exploits of the East India Company didn ’ deoxythymidine monophosphate end in India. In one of its darkest chapters, the Company smuggled opium into China in substitution for the state ’ s most pry trade good : tea. China alone traded tea for silver, but that was heavily to come by in England, so the Company flouted China ’ second opium ban through a black grocery store of indian opium growers and smugglers. As tea flowed into London, the Company ’ s investors grew full-bodied and millions of chinese men wasted off in opium dens. When China cracked down on the opium trade, the british government sent warships, triggering the Opium War of 1840. The humiliating chinese frustration handed the british control of Hong Kong, but the dispute shed far light on the East India Company ’ s dark dealings in the name of profit. READ MORE: How Hong Kong Came Under ‘One Country, Two Systems’
By the mid-19th century, opposition to the East India Company ’ s monopoly status reached a fever sales talk in Parliament fueled by the free-market arguments of Adam Smith. Erikson says that ultimately, the death of the East India Company in the 1870s was less about moral indignation over corporate putrescence ( of which there was enough ), but more about English politicians and businessmen realizing that they could make even more money trade with partners who were on a stronger economic foothold, not captive patrons of a corporate state. tied though the East India Company dissolved more than a hundred ago, its influence as a pitiless corporate pioneer has shaped the way modern business is conducted in a ball-shaped economy. “ It ’ s hard to understand the global political structure without understanding the function of the Company, ” says Erikson. “ I don ’ deoxythymidine monophosphate think we ’ d have a ball-shaped capitalistic economic organization that looks the way it does if England hadn ’ deoxythymidine monophosphate become then uniquely mighty at this point in history. They transitioned into a modern industrial power and exported their sight of production and administration to the rest of the global, including North America. It ’ s the cornerstone of the modern big ball-shaped political arrange. ”