American tariff policy and the British alkali industry, 1880-1905

Brian Varian

Economic History Working Papers from London School of Economics and Political Science, Department of Economic History

Abstract: Until the late nineteenth century, the British alkali industry enjoyed a colossal export market in the United States. Yet, as several scholars have already noted, the highly protectionist Dingley Tariff of 1897 caused a precipitous and irreversible decline in the volume of British alkali exports to the United States. Drawing upon an abundance of textual evidence, this study argues that, in addition to the climactic Dingley Tariff, previous American tariff acts in 1883, 1890, and 1894 also exerted a pronounced influence on the volume of British alkali exports to the United States. Further corroborating this claim is a regression analysis that employs, as an explanatory variable, newly constructed annual estimates of the ad valorem equivalent tariff that the United States imposed upon alkali imports from Britain. Approaching the British alkali industry from a microeconomic standpoint, this study also argues that one particular British alkali firm, Brunner, Mond & Co., mitigated its financial exposure to American tariff policy by acquiring, in 1887, a minority shareholding in a nascent American alkali firm, the Solvay Process Company. Profits from Brunner’s shareholding in the Solvay Process Company substantially offset the profits that Brunner, Mond & Co. lost as the result of its diminished alkali exports to the United States. The other dominant British alkali firm, the United Alkali Company, did not fare so well.

Keywords: alkali; chemicals; tariffs; trade; Britain; United States; nineteenth century (search for similar items in EconPapers)
JEL-codes: N61 N63 N71 N73 N81 N83 (search for similar items in EconPapers)
Pages: 62 pages
Date: 2014-03
New Economics Papers: this item is included in nep-his and nep-int
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