a. Condition of Trade at the Time of the Union of the Crowns

In spite of the political and religious disturbances in Scotland in the sixteenth century, the trading community seem to have been able to carry on their business without much interruption and with some success. But their trade was curiously unaffected by those influences which were doing so much to transform the economic organisation of other European countries—the discovery of America and the consequent influx of silver. Capital was still extremely scarce in Scotland and manufactures were in a very backward condition, as also was agriculture. A paper amongst the manuscripts of the Earl of Mar and Kellie gives some idea of the commodities in which the Scots dealt and of the extent of their industrial development. It is entitled the "Table of Scottish Produce exported yearly," and gives a list of all the commodities exported in the year 1614, together with their value. The "commodaties of the land" are the most valuable exports, amounting to £375,085 Scots. These include different kinds of grain, some flour and beef, £37,655; hides, £66,630; skins, £172,082; wool, £51,870; feathers, butter, lead ore, coal, £46,850. The value of the manufactures is £169,097, of which salt, cloth and plaiding, and linen yarn are the most important. The others mentioned are linen cloth, coarse cloth, knitted hose, dressed leather, gloves, leather points, sewed cushions, ticking for beds, shoes. The export of fish brings £753,354, and of foreign commodities imported and then exported again, £39,047. The total value for the year is £736,986 Scots. This does not include the "greit quantitie of lynning claythe, lynning yairne, sheip, nott etc. that is transpoirtted be land dalie," presumably to England. The most important exports were therefore unmanufactured commodities, skins, hides and fish, and the manufactures exported were those of an economically undeveloped country.

There were no companies of merchants organised for trading to particular places, as the English Merchants Adventurers, Eastland Company, etc. But the merchants of the Royal Burghs practically formed an exclusive and privileged company, for only they were allowed to engage in foreign trade. The Convention of the Royal Burghs looked after their interests, organising and supervising all the foreign trade of the country; appointing conservators to watch over Scottish interests in different places; settling disputes between merchants; and even making regulations concerning their clothing. In 1529, because many merchants trading with France and Flanders "takis with tham thar evill and wirst clais to the dishonour of the realme," the conservator in Flanders was ordered to insist on their providing for themselves "honest clais," and in case they should refuse he was entitled to seize and sell their goods, and with the proceeds to procure and pay for suitable garments. Scottish merchants seem to have had a reputation for "parsimony in apparrell and dyet and...exceeding industriousness and diligence." They had not been at war with any continental nations for a long time, and their ships therefore did not require to be equipped for war as well as for trade. They were as a rule smaller than English ships, required less ballast, and in proportion to their size and the expense of sailing them, could take in a larger cargo and charge a smaller freight rate. Another reason for the cheapness of their freight was the way in which the crew lived. " The Scotts marriners go not to sea as our men goe everyone for wages in certainty and feeding on the Victueller or Owner on the best Beefe Porke Beere Biskett of the finest Wheat and to care not what they spoile of the owners..., nor how long time they protract in making their Voyage and Return. But everyone...finds himself the whole*Voyage eates no Bread but Oaten Cakes made of Bean baked on the hearth and salt ffish fryed on the Coales from hand to mouth by himself, nor weares no Cloaths eyther Lynnen or Woollen (which are very mean) but those of their own countrey makeing and at cheapest Rate.... And besides... every one in their ships...is a kind of Merchant himself and will be sure to bring some Lynnen Scotch Cloth...or Such like from home upon his own Account and make a like Returne of some Commodities which the fforeyn Markett yeildeth. Whereas in our English Shipps they are not much given to this thriveing course as they are prohibited by the Merchants that fraight them to do it, for the marring of the Merchants own Markett....The Scotts Owners of Shipps and Mariners will be able and readie to undergoe a freight to any forreyn parte for under our Owners rate, and yet by these meanes gain whereas ours loose by it." A good deal of the Scots foreign trade seems to have been carried on by pedlars, who, when their ship reached port, travelled up and down the country with their packs, selling to the country folk, like the Breton onion sellers of to-day. The crew of the ship may also have taken part in this peddling trade.

The Scots in their small ships did not penetrate very far afield. Their commercial connections were chiefly with France, Spain, the Low Countries, and the Baltic. There was also some trade with England. The French and Dutch trades engaged more merchants and ships than any other. There had long been a close connection between Scotland and France, commercial as well as political. According to one authority, the first commercial treaty had been made by Achaeus and Charlemagne in 787. Coming to more modern times however, in 1510 Francis I exempted the Scots nation from the payment of customs in Normandy. This was confirmed by Henry II in 1554, and at the same time the Scots were exempted from the payment of some new duties then imposed. Four years later, when Mary was married to the Dauphin, all Scotsmen were made naturalised subjects in France and all Frenchmen in Scotland. Scots merchants were therefore free from all impositions laid upon strangers. These privileges were all confirmed by Henry IV in 1599. The Scots traded chiefly to Normandy, Bordeaux and La Rochelle, taking thither wool, skins, hides, plaiding, kerseys, salmon, and bringing back wines and salt. A number of Scottish ships were also engaged in the carrying trade for France. In 1615 it was said that "the greittest number of the best schippis of Scotland ar continuallie imployed in the service of Frenchmen, not only within the dominions of France, bot also within the boundis of Spayne, Italie and Barbarie4."

Trade with the Low Countries was also important. The Convention of the Royal Burghs received privileges for their merchants there by a contract with some city, which was then called the Scots Staple Port, to which certain specified commodities, including all the most important Scottish exports to the Netherlands, had first to be brought. Certain privileges were granted to the Scots merchants in Flanders in the fourteenth century, but the first definite treaty with Scotland was made by Bruges in 1407. This city was the headquarters of the Scots merchants during the greater part of the fifteenth century, though they also traded with Middelburg, and the Staple was for a time established there. In 1506 some arrangement was made with Campvere, and after competition on the part of Middelburg, Antwerp and Campvere for the monopoly of Scots trade, the Staple was fixed at Campvere in 1541. There it remained with but two short intervals until the Staple contract was cancelled in 1799. Scottish shipping seems to have been considerable in the sixteenth century, if the following incident may be believed. During Charles V's wars with Francis I, the Scots, although they were considered neutral, seized some English ships at Campvere. The Emperor then ordered his subjects in the Netherlands to make reprisal upon them, but "the Scots likeweys equipped, and were so much superior at Sea (which will now hardly gain credit) that they not only confined the Dutch and Flemish Privateers in their harbour, but interrupted the Trade of those of the Provinces, Flanders, Zealand and Holland, and of the great city Antwerp itself." The principal commodities which the Scots took to the Netherlands were cloth, skins, wool, fish and salt. They received a good deal of soap, corn and hardware, and a number of miscellaneous articles. There was also some trade between the ports on the east coast, Aberdeen, Dundee, the Fife ports and Leith, and the northern countries, Norway, Sweden, Denmark, and the Baltic ports. Of this trade we have valuable information in the Compt Buik of David Wedderburne, a Dundee merchant. The Baltic ports which the Dundee ships chiefly frequented were Dantzig and Konigsberg, and also Stralsund and Lubeck. The imports into Scotland were principally timber, iron, flax, hemp, pitch and tar.

During the sixteenth century there was a good deal of intercourse between Scotland and Spain. In 1581 "certan writis evidentis and privilegis granted be the King of Spain under his greit seill, for the weilfair of the Scotis natioun" were obtained. The trade chiefly developed during the wars of England with Spain, when the English merchants traded with Spain under cover of the Scots trade. Several instances of this are given in the Calendar of State Papers (Spanish). "Two Scotch Ships either have left or will shortly leave London....One of them is of 150 tons burden called the New Ship of St Andrews...loaded with wrought iron and tin and lead in pigs and a quantity of English serge. The goods bear the leaden seal of Edinburgh, but are made in England and the seal is placed on them to deceive....The other ship is from Little Leith...carries similar merchandize; The value of the cargoes is estimated at £14000." The Editor, in a note to this reference, says, "The above is given as a typical instance of the continual trade in English merchandize with Spain under cover of Scottish merchants during the period when all commercial communication between England and Spain was prohibited." In 1603 the Venetian Secretary in London writing to the Doge, in reference to the question of peace with Spain, says that James I has often been helped with money by Spain, "especially before Spanish and Flemish commerce came to Scotland. It was then that the revenue which ordinarily did not exceed 100000 crowns, was greatly increased, as the King was able to tax the seaports, which were growing rich, by imposing customs upon wine and other commodities." In another letter the Secretary declares that the revenue in Scotland has increased to 400,000 crowns, "thanks to having an open trade to France, Spain and all the northern countries." The political connection with England before the Union was slight, and the commercial relations of the two countries were also of little importance. There was some trade in linen cloth and yarn, salt and sheep from Scotland; and from England were brought wheat, beer, bark, woollen cloth, etc. The Scots frequented chiefly the ports of London and Newcastle, but Plymouth and other harbours in Devonshire and the West were also visited. There was also some trade by land, but the disturbed state of the Borders on either side made peaceful traffic difficult. There was no Scots conservator in England, and though the King suggested in 1599 that one should be appointed, because of the complaints of merchants trading thither, the Convention of Burghs declined to do so. They declared that a conservator was not " necessar to thair estait bot rather hurtful and chargeabill to the samyn." Some figures given in "An Estimate of the Customes and Subsidies of Tonnage and Poundage as well Inwardes as Outewards payd by Scottishe Merchantes for VII yeares," from 1597 to 1603, shew that the trade was but small. In London the duties inwards paid for the seven years Amounted to £743. 19s. 4d, and outwards to £595. 0s. 1d. The duties paid at the outports were £1366. 18s. 6d. and £1679. 12s. 6d. respectively3. In Scotland the customs paid for a year, 1605-6, on the English trade were £1083, paid by Scots and English merchants.

As yet the Scots had not penetrated across the Atlantic. Fynes Moryson says that though the "Scots are very daring...they have not hitherto made any long voyages rather for want of riches, than for slothfulnesse or want of courage." They had not yet been inspired by the general impulse of the sixteenth century to compete for the "golden ball of trade."

b. Negotiations for Commercial Union

James VI, on his succession to the throne of England, was extremely anxious that his two kingdoms should be fused into one homogeneous whole; that Scotland and England should lose their separate names and nationalities, and become the kingdom of Great Britain. For the first few years of his reign he made great endeavours to accomplish this end, but English hostility and Scottish indifference were too much for him, and with the growth of other interests in England the project was allowed to drop. One of James's first acts when he came to England was an "Act authorising certain Commissioners of the Realm of England to treat with Commissioners of Scotland for the weale of both Kingdoms." Commissioners were appointed in Scotland also, and the two deputations met, discussed conditions and drew up a Treaty of Union, to be proposed to their respective Parliaments. Some of the articles were afterwards incorporated in the two acts—"An Act for the utter Abolition of all memory of Hostilitie and the Dependances thereof between England and Scotland," and "An Act anent the Union of England and Scotland." The latter declared " That all the particular hostile Laws.. .maid be Scotland aganis England as Enemies sail be abrogat and in all tyme cuming all utterlie extinguished." The other clauses of the treaty were not carried into effect. A number of the articles dealt with the subject of commerce, though an entire commercial union was not suggested. It was proposed that there should be free trade in the native commodities of either country, with the exception of wool, sheep, sheepfells, cattle, leather, hides and linen yarn. This "mutual liberty of exportation and trade" was to serve "for the inward use only of either realm." Commodities of which the export or import was prohibited for either country were to be prohibited for both. Otherwise import and export were to be free for subjects of either kingdom. Import from France was excepted until inquiry should be made into the extent of Scottish privileges there. Imported foreign goods that had paid custom once were not required to pay it again on passing from one country to another. The fisheries within fourteen miles of the coast were to be retained by each nation respectively. Merchants of either country were to be allowed to join the companies of the other, which meant that Scots merchants might join English companies, as the Scots had no associations of merchants. Certain sources of future difficulties are obvious in the conditions of this treaty. The customs rate differed in each country, being as a rule lower in Scotland. Therefore some foreign commodities paying duty in Scotland might be sold at a profit in England, where the duties on the same commodities were higher, although the cost of. transport might equalise matters. The regulation of import and export in different interests by different authorities would always be a difficulty. English manufactures, for instance, were more developed than those in-Scotland, and therefore the export of raw materials was restrained in England, whereas Scotland's chief trade was in unmanufactured goods.

The union project aroused much opposition amongst English merchants. They objected to the idea of any union at all, and in detail to almost every clause of the treaty. They declared that the Scots were so poor that their incorporation with the English trading community could be no benefit to England, for the "kingdom of Scotland noway affordeth commodities in any reciprocall course with England for trade and merchandising." The merchants said that they "do already of themselves vent all the Commodities of this land, and yet are they hardly able to live one by another. Quando minus therefore shall they be able if they admit such an unnumbered sort of people of another nation to intermingle themselves among them in an equall communion of commerce." Also the Scots "trade after a meaner sort and condition in foreign parts than we, as by retailing parcels and remnants of cloth and other commodities up and down the countries as we cannot do because of the honour of our country." It was feared that poor Scots would flock to England "in such multitudes as that death and dearth is very probable to ensue and wheresoever any artifizer or tradesman of that nation shall dwell or abide it is very likely that in a short time he will gather unto himself the wealth of his neighbours, and undermine them in profit as the horse will undereat the ox such is their, parsimonious life in respect of ours and their poverty will be evermore a spur unto them to make them industrious to thrive but to be satisfied there is no hope for." As an illustration of the "parsimony and diligence of ye Scotch above ye English nations," the following tale is told. At Dartmouth, "two ships (the one English and the other Scotch) being both ready to Wey Anker and bound for wyne at Burdeaux the wind happening fair for them on Mas Day the Scotch accordingly weyed Anker, and hald over to his consort the Englishman and asked him why he did not Wey Anker accordingly So when the Englishman Answered I have all my men on board and am ready but I have bid my neighbours to a Michmas Goose and I will goe but on shore and eat it and come presently. In which little Interim the Scotch Ship was no sooner freed of the Harbour but the wind cast about, So as when the Englishman came aboard after dinner he could not wind out of ye Harbour though that wind Served the Scotchman at sea well enough. About 6 weekes after the Scotch ship revened with her full loading of Wine into the same Harbour upon the foresaid Englishman haling for newes the Scotch answered that they had brought Wine for their goose." One would conclude from this incident that the Scots were not given to wasting their opportunities. Presumably, from the many complaints as to their "mean way of trade," their expenses were less and their profits greater in the few branches of trade in which they came into contact with English interests.

Passing from general to particular objections, English merchants seemed to fear that the Scots would get cloth from the northern counties more cheaply than their own merchants in the south, would transport it abroad and thus ruin their trade. Also that the Scots would sell English commodities which were not allowed to be exported, to French and Flemings in Scotland. Then, too, the taxes and customs differed in the two countries, and were as a rule higher in England than in Scotland. The English merchants failed to see why the Scots, with fewer burdens on their trade, should share English advantages. The greatest obstacle, however, was the question of the Scottish privileges in France. As has been said, the Scots obtained the privileges of naturalisation in France in 1558, and therefore traded on the same terms as natives of the country. It was possible for English subjects to become naturalised in France, but only on payment of a certain fee, generally 100 crowns, and they were then regarded as foreigners in England8. All Scotsmen, on the other hand, were naturalised Frenchmen, and at the same time kept their position as Scots subjects. The benefits accruing to the Scots were considerable. They could hold offices and acquire land in France, which the ordinary Englishman could not do. They paid fewer impositions and customs, only four pence in the pound; while the English merchant paid the four pence, and two other impositions as well. Also English merchants were only allowed to sell their cloth at the Freehall at the ports to which they resorted. Other goods had to be displayed for sale on the wharf for a certain time, paying a rent meantime for using it. Scots merchants could sell their goods in their ships or anywhere else they pleased  They could also buy goods freely, and were permitted to sell them again in the country. But the privileges for export were only observed for goods to be conveyed into Scotland; if they were to be transported elsewhere, the Scots merchants had to pay the same duties as other foreigners. Nevertheless, the English feared that the Scots would undersell them in the French trade.

Almost all objections made against a union were answered, and the difficulties shewn not to be insuperable. A proposal was even made to equalise the customs. This would have removed the principal obstacles in the way of a commercial union at the time, but unless the union was parliamentary as well, there could be no satisfactory guarantee that either customs or regulations as to imports and exports would remain the same in the future. To inquire into the differences in the French trade it was agreed that two representatives from either side should be sent to Normandy to inform themselves of the state of affairs there, and also in other parts of France. In the Bordeaux trade neither appeared to have much advantage over the other. The work of the commissioners was, however, vain as far as the discussions on commerce were concerned. The English Parliament only abolished all hostile laws against Scotland. In the Scottish Parliament the whole treaty was passed, but with the proviso that " the same should be in like manner ratified by the parliament of England, otherwise the conclusion taken should not have the strength of a law." As England did not ratify the treaty, it never became valid in Scotland. One most important result of the Union was achieved, not by Parliament, but by the decision of the judges—the naturalisation in England of all Scotsmen

tborn after James's accession to the English throne. In fact neither nation was at this time at all anxious for a complete union. The merchants of London declared that "it cannot otherwise prove to be but an impoverishment to both nations and will in the sequell of time... turn also to the hurt and detriment of the state of both the kingdomes." The Scots spoke of "that Union so greitlie hated by them," the English, "and so little affected by us"; and hoped that his Majesty "would be pleased to desist fro any further moving of this Union." The mutual hostility of over three hundred years was not to be overcome merely by the accession of a Scottish king to the English throne. Bacon's vision of "England, with Scotland united, with Ireland reduced, with the Low Countries contracted, with Shipping maintained...the greatest Empire that hath been heard of in many Ages" was not to be realised in the seventeenth century.

Although the scheme for commercial union failed, there was for a few years, while the negotiations were being carried on, free trade between the two countries. The merchants of both countries seemed at once to conclude that James's accession in England of necessity brought with it freedom of trade. A Proclamation in November, 1603, declared that both Scots and English had transported goods by "fels and other by-passages," by which his majesty was defrauded of his customs. Therefore all goods were ordered to be sent by Berwick or Carlisle, or shipped at some known port. The defrauding of the customs continued, and in 1605 and 1606 arrangements were made for books to be kept by the farmers of the customs in both countries, in which all goods passing from one country to the other were to be entered. These were to be compared every six months in order for the "escheiving of all fraud that may be useit heireftir." Next year, however, James, "being myndit...to unite thir twa famous kingdomes under his Majesty's royall crowne and sceptour and to remove all markis of separatioun betwixt the same...in the mean-tyme of the treaty of this Unioun and for the better introduction of the Same," commanded that no customs should be taken for commodities transported between the kingdoms. Caution was to be taken for the payment of the customs in case "the same treaty tak not effect." The commodities which were freed from duties were to be only enough for the use of each country, not for exportation. This policy was not found to be successful, and in 1611 the duties were reimposed again. It was found that not only did the King lose revenue, but goods which were not allowed to be exported from one country were secretly conveyed into the other and thence exported. Goods transported by land were therefore ordered to be taken through Berwick or Carlisle on the English side, and by Aytoun, Jedburgh, Kelso, Dumfries or Annan on the Scottish border.

Four years later another proclamation dealing with trade was issued. James declared that "ever sithence Our comming to the possession of the Imperial Crowne of the Kingdomes of England and Ireland, Our ful resolution and constant purpose and meaning was, and always hath beene by all good meanes to set forward and advance Trade, Trafique and Merchandize, aswell Within Our Kingdome of Scotland, as in Our Kingdomes of England and Ireland, and to augment and increase the Ships, Shippings and Navigation of the same Kingdomes of England, Scotland and Ireland for the Wealth; Strength and prosperitie of the same Kingdomes, And for that purpose and to give the better encouragement unto Our natural  Subjects of the said Kingdome of Scotland to set forward and increase their Trade." Therefore orders had been given that no other duties were to be paid by Scots ships or goods than were paid by English or Irish ships or goods, in England and Ireland, and the "Hands under the Dominions of the same." Also Scottish ships were no longer to be considered "Strangers Bottomes but free Bottomes." English and Irish ships and goods were to have the same privileges in Scotland. This was confirmed by Charles I in 1631 in "a Proclamation for enabling all His Majesties Subjects to Trade within His Severall Dominions without being further charged with Customes, or other dueties, than they of that Kingdome wherein they trade, ought to pay." Certain staple commodities were not allowed to be exported to Scotland. In 1622 the exportation from England of "Woolles, Woolie-fels, Yarne, Fullers earth, and Wood-ashes into any forraine parts, or into Our Kingdome of Scotland" was forbidden. Apparently great quantities of hides and leather were conveyed into Scotland, and in 1626 their transportation was also forbidden. In 1632 the transportation of these commodities, and also of corn, out of England was prohibited. During the reigns of the first two Stewarts, therefore, the Scots and their ships were treated as natives and not as aliens.

Under Commonwealth rule there was an approach to a system of laissez faire and absence of regulation. In this period Scotland was commercially united with England, and there were no restrictions at all upon trade between the two countries. With the Restoration Parliament began to take a much larger share in the regulation of economic affairs in both countries. The English Parliament adopted a strong protective system. As far as they could see free trade with Scotland neither had been nor could be of advantage to English commercial interests; they had no desire to promote Scottish prosperity, and, though Charles was anxious for a commercial union between the two countries, Scotland was treated as a foreign country by the legislation of the English Parliament. The Scottish Parliament also adopted a protective policy, and, in return for English restrictions, laid heavy burdens on English trade with Scotland. The first period of the seventeenth century, therefore, was more favourable to the interests of Scottish trade with England than the period of parliamentary regulation after the Restoration.