Over much of its course Canadian economic history may be fairly described as an extension of European economic and political influence in the northern part of North America. It is important to notice that this northern expansion was only one phase of European expansion into the Americas, and that development elsewhere in the New World helped to determine the direction and character of economic change in Canada. In other words, Canada cannot be studied in isolation from Europe or the rest of North America, since she did not, in any sense, develop separately from these areas. Our problem at the...

To find a starting date for Canadian economic history is not as easy as it might appear. Nor is this difficulty confined to the history of Canada. No matter where we choose to break into the continuous stream of events which is history-as-it-happens, our selection is always more or less arbitrary. The best we can do is to pick out an event which seems to have marked a turning-point of some kind—one from which later developments can be shown to have stemmed more or less directly, even though the event we select is itself part of a continuous process....

In contrast to the continental fur trade, where monopoly control established itself at an early date, the North Atlantic in the period from 1650 to 1713 continued to be the scene of intensely competitive rivalries. Spain and Portugal now played only a minor role as active participants in the fisheries, though they retained their importance as markets. French fishermen established themselves with government support on the south coast of Newfoundland, in Cape Breton, and in the Gulf of St. Lawrence and offered serious competition to the English fishing fleets operating from ports in Devon and Cornwall. Despite the opposition of...

The dispersion of the Hurons by Iroquois attack in 1649 and 1650 destroyed the trading system by which the French on the St. Lawrence had been enabled to secure supplies of furs from the tribes of the interior. The reconstruction of the trade demanded military protection against the Iroquois and the development of a transport system by which the French themselves could convey trade goods to remote tribes and carry back furs to Montreal and Quebec. The creation of this new trading system and its defence against attack were the principal tasks facing the French colony on the St. Lawrence...

The terms of the Treaty of Utrecht were a serious set-back to French interests in North America and made the task of consolidation even harder than it had been before. In the North Atlantic the French response was to shorten their lines of defence and reinforce their key positions. Of vital importance was the fact that the treaty permitted them to retain Cape Breton Island, where in 1714-15 they constructed Louisbourg, the strongest military and naval base in North America. From the strategic point of view the site was well chosen. Louisbourg commanded the entrance to the Gulf of St....

Throughout the troubled years from 1686 to 1713, the Hudson’s Bay Company had managed to retain its foothold on the Bay and to preserve—indeed, to improve—its organization. The flow of furs across the Atlantic to the London auctions had never been completely interrupted, for though the French controlled most of the posts around the Bay the Company held Fort Nelson until 1694 and Fort Albany and Moose Factory thereafter, and from these bases it was able to carry on a limited but regular trade. French competition even in its most aggressive form had not put the Company out...

The British government, in the years between the fall of the French empire and the beginning of the American Revolution, had been faced with a nearly impossible task. The empire in North America for which it was responsible was no balanced structure of mutally complementary parts, such as mercantilist theory assumed, but rather a mixture of diverse and competitive units which together presented almost insurmountable obstacles to consolidation into a single economic system. Merely to hold all the component parts of this sprawling empire in allegiance to the British Crown would have taxed the abilities of the wisest of administrators....

After the conquest of Canada the St. Lawrence fur trade was taken over by a group of English, Scottish, and American merchants who, with credit obtained from British exporting firms, quickly rebuilt the trading system in the interior which had originally been created by the French. With the assistance of important innovations in transportation and supply, these merchants within a few years were able to extend their trade into the Athabasca region and as far west as the Rocky Mountains. The larger capital requirements which accompanied the extension of the trade to the west encouraged the formation of the North...

Canada’s first staple trade, the trade in beaver fur, had been founded upon the existence of a demand in Europe for a commodity which was available in large quantities in North America and upon the creation of transport facilities which brought demand and supply together. The Canadian timber trade, which developed during the fur trade’s closing decades, similarly depended upon the presence in North America of large and easily accessible supplies of a commodity greatly in demand in Europe, but it differed from the fur trade in its transport requirements, in its relation to immigration and settlement, and in the...

In the emphasis that has been placed on developments in the North Atlantic area and on continental expansion across North America, there is danger of overlooking one of the most strategic regions in our history. Events in the North Pacific helped to shape the destinies of North America in the nineteenth century, and today growing interest in the rich resources of the Pacific coast states of the United States, and in those of British Columbia, Alaska, Eastern Siberia, and Northern China is evidence that this once neglected part of the globe is rapidly becoming one of the most significant areas...

After 1815 the fisheries of New England and France quickly recovered from the reverses which they had suffered during the Napoleonic Wars. Nova Scotia, whose fisheries and trade had expanded during this period, sought to meet the revival of competition by demanding that American ships should be excluded from the in-shore fisheries and from trade with the West Indies. The first of these objectives was achieved in 1818, when the in-shore waters of the British North American colonies were closed to American fishers. The United States, however, by imposing retaliatory restrictions on colonial and British shipping, successfully forced entrance into...

The absorption of the North West Company by the Hudson’s Bay Company in 1821 reflected and contributed to profound changes in the development of the area tributary to the St. Lawrence River. With the disappearance of the North West Company, the merchants of Montreal lost the first great staple upon which their dreams of continental empire had been built. Thenceforth the fur trade was to be carried on from bases on Hudson Bay and on the Pacific coast. The old commercial link which for so long had tied the St. Lawrence to the economies of Europe had gone.

Meanwhile, and...

In 1815, on the conclusion of the war with the United States, the political authorities of Upper and Lower Canada instituted a policy of excluding American settlers. Such a policy was, of course, difficult to enforce, for it was not easy to distinguish an American from a resident of Upper Canada once he had crossed the frontier, and certainly it did not completely shut off the influx of American immigrants. It appears probable, however, that it did divert toward Ohio many of the westward-moving American migrants who would otherwise have taken the easy route into Upper Canada by way of...

By the middle of the nineteenth century the Canadian colonies on the St. Lawrence, united politically in 1840, had laid the foundations of a unified commercial economy, based upon the exploitation of timber resources, the production of wheat, the construction of a uniform system of inland waterways, and the development of an elaborate network of commercial credit centring on Montreal, the point where the commerce of the interior and the commerce of the North Atlantic met. The repeal of the Corn Laws, symbolizing dramatically the end of an era in which the political bonds of empire had been maintained and...

The long and bitter struggle between the Hudson’s Bay Company and the North West Company ended with the amalgamation of the two organizations in 1821. Important advantages on the side of the Hudson’s Bay Company in this struggle had been greater financial resources, centralized control over policy, and the lower transport costs of the Bay route. The formation of the new organization, which operated under the name and charter of the Hudson’s Bay Company, was followed by attempts to combine these advantages with the trained personnel and efficient operating techniques of the North West Company. The first five years after...

The years between 1849 and 1867 form an important watershed in Canadian history. During this period changes in the technology of communications, particularly the railway and the iron steamship, and changes in the organization of economic life, particularly the expansion of industrialism in Britain and the United States, drastically altered the environment in which the colonies which were later to form the Canadian nation sought to live and grow. Old staple products such as square timber, for many years the chief reliance of the St. Lawrence colonies and New Brunswick, began to decline, and newer staples, notably wheat, grew in...

The uniting of the four provinces of Ontario, Quebec, New Brunswick and Nova Scotia in 1867 stands out as one of the great episodes of Canadian political history. On the one hand, it established the political framework necessary to the building of a nation in the northern half of the North American continent; on the other, it provided a more explicit formulation of the new strategy of Canadian development which had made its appearance in the 1850’s. Yet in the implementation of this strategy Confederation was less a fulfilment of nationalistic aspirations than a bare beginning on the task of...

The confederation of the maritime provinces and central Canada in 1867, the purchase of Rupert’s Land in 1869, and the admission of British Columbia to the federation in 1870 brought into being a new nation in North America. Political union, however, stood little chance of survival unless it was complemented by economic union. This was necessarily a slow and difficult process. It was not enough merely to abolish tariffs between the provinces and interpose tariffs between them and the outside world. The tariff as an instrument of economic development could not be effective unless the various regions of Canada, with...

Basic to Canada’s growth over the centuries has been the evolution of her financial system. From primitive beginnings in the French regime, it has developed to form the complex and efficient network of institutions of today. On this development each of the staples in Canadian economic history has left its mark. The financing of an export trade in fur and timber called for institutions and techniques essential to the exploitation, carriage and marketing of these export commodities. Reference was made in earlier chapters to the provision of credit for the operations of the great fur-trade organizations and the dominant firms...

The emergence of wheat as Canada’s great export staple of the early twentieth century has been a major theme in the literature of Canadian development. This is not surprising, for in the process whereby Canada became a strong trading and industrial nation this staple occupies a central place. It is not too much to say that wheat was the keystone in the arch of Canada’s National Policy. Its production and sale made possible the construction of transcontinental railway systems and the extension of political control across the continent to the Pacific.

As with any major undertaking, the cultivation of the...

Throughout most of its history Canada has been an economic satellite of other more advanced nations. Its exports have been almost exclusively raw materials and foodstuffs. Its imports have been manufactured goods produced by the industries of Britain and the United States. The pace of development has been set by the rise and decline of the great staple trades: fur, fish, timber, gold, wheat, and more recently pulp and paper and the base metals.

This pattern of development depended upon the maintenance throughout the world of conditions which were sufficiently stable and orderly to permit international division of labour and...

As Canada has moved toward the status of an industrial nation, she has had increasingly to concern herself with the problems of social welfare that characteristically accompany industrialism. Not least among these has been the problem of maintaining industrial peace and reconciling the often conflicting interests of management and labour. Some mention must therefore be made of the growth of labour organizations in the Canadian economy and of the role such organizations have come to play in the nation’s affairs.

At the beginning of 1953 there were 1,219,714 labour-union members in Canada out of a total labour force in employment...

Revolutionary changes in resource exploitation and use in the modern Canadian economy have been accompanied by equally striking developments in finance and trade. The financing of this twentieth-century industrial revolution drew to Canada a volume of foreign investment greater than that attracted to any other country; the increase in Canada’s national production which this investment helped to bring about established her position as one of the world’s leading trading nations. The magnitude of Canadian borrowings over the past three decades and the principal sources of investment funds may be noted briefly.

In 1926, foreign long-term investment in Canada amounted to...