'Hidden' British protectionism: the Merchandise Marks Act 1887

The merits of Britain’s trade policy in the late nineteenth century have been long debated. Williamson and O’Rourke found a positive correlation between tariffs and growth across countries in the period, suggesting that free trade harmed the British economy. By contrast, Crafts and Broadberry disagree with the idea that the late Victorian slowdown in British productivity can be ascribed to weak exports, and instead highlight the benefits of openness to Britain’s services sector. This dissertation will aim to contribute to this debate by examining a little studied example of British soft protectionism. In 1887, Britain sought to protect manufacturers from competition in home and foreign markets by passing the Merchandise Marks Act. This required that a large share of imports had to be marked with an indication of their country of origin. It was hoped the Act would protect the reputation of British products, curtail unfair foreign trade practices, and encourage consumers to buy British products. While the Act was not a tariff, it generated controversies that echo those today over geographical indicators (GIs) and can be seen as an early form of non-tariff barrier. The second part of the dissertation addresses whether the Act affected British trade. I do not find evidence the Act was able to halt the advance of German manufacturing exports to Britain. But there is strong evidence that it damaged Britain’s entrepot trade and enhanced trade between commercial rivals and colonial markets. This supports Broadberry and Craft’s assertion that economic openness benefitted the British economy.