Economy in The British regime (1763-1867)



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Economy in The British regime

British Regime (1763-1867)

  • Treaty of Paris (1763) = Change of Empire

  • The British were now in control of the Fur Trade industry

  • Arrival of British merchants in the colony

  • The Hudson Bay Company (old) vs. The Northwest Company (new): competition increased fur production

  • Many Voyageurs (French Canadians) hired to work for the NWC

Fur trading companies during the British Regime

  • Northwest Company was a Montreal-based fur trading company, owned and run by Scottish merchants

  • They had trading posts in the North-West of Canada, creating competition for the long established Hudson’s Bay Company

  • All that hunting = decrease in resources

  • Merger of the 2 companies in 1821

  • Supply: Hudson Bay region

  • Actual fur trading: Great Lakes region

Why did the fur trade decline?

  1. Increasingly remote trading territories

  2. Increasingly expensive operating costs

What are some consequences of this decline?

  1. HBC takeover of the NWC

  2. The Hudson Bay region replaces Montreal as the main place of export

La Chasse Galerie
(A voyageur’s tale)

The Timber Trade

  • The Fur Industry continued to be the main industry and export in Quebec until 1810 when Timber became the main export, but most inhabitants still practiced agriculture.

  • Great Britain provides the capital ($$$)

  • French Canadians and Irish immigrants are the labour force

  • Several new jobs and trades developed: lumberjacks, log drivers, sawyer

  • Products made with timber in Lower Canada: large squared pine, oak beams, staves, construction lumber

Important Economic Terms…

  • Protectionism: An economic policy (rule) established by a government in order to protect the economy of the country from foreign competition.

  • Tariff: A tax imposed on imported products.

  • Preferential Tariff: A less expensive tax imposed on products imported from certain colonies\countries.

The Rise of the timber trade & protectionism

  • In 1806 Britain was at war with France.

  • Britain turned to Canada for timber after Napoleon's continental blockade.

  • Great Britain needs wood to build warships

  • Lower Canada prospered immensely and the timber industry emerged

  • Many French Canadians got jobs in this new industry, as well as, eventually, Irish immigrants

  • Britain maintained the policy of protectionism and preferential tariffs, which favored purchasing resources within the colony.

In short…

The factors that contributed to the development of the timber industry during the British Regime are:



  1. Napoleon’s continental blockade

  2. The need for construction of warships

  3. Great Britain’s preferential tariffs

What are the effects of protectionism on the colony?



  1. Increase in timber exports to Great Britain

  2. Increase in port activities

The timber trade: changes in the colony

  • New regions colonized: Mauricie, Outaouais, & Saguenay

  • These regions were ideal: near rivers

  • Development of canals (ex. Lachine Canal, Rideau Canal, etc.)

  • Rich entrepreneurs invested in developing the timber industry

  • They also invested in developing the area: roads, mills, construction material, wells, etc.

  • Increase in the number of workers and artisans

  • Many workers moving to the newly colonized regions (to be near work)

  • Farmers are getting extra income (think winter time)

Economic development as a result of the timber industry:

Merchants needed a way to make their financial transactions easier, and they needed access to capital.



  1. Development of banks in Canada

  2. Issue of paper money by banks

    • 1817: Canada’s first bank (Bank of Montreal)

Changes in agriculture in the 19th century

  • More farmland (townships)

  • Diversification of crops: oats, wheat, barley, potatoes, various vegetables

  • Great Britain and Lower Canada are the market for these products

  • Decline of wheat production in Lower Canada caused by:

    • Overpopulation in the farmlands

    • Soil exhaustion in the seigneurial zones

Farmers have some solutions:

    1. Settling in the newly colonized regions

    2. Moving to the city

    3. Emigrating to the USA

Changes in transportation in the 19th century

New infrastructure in the first half:



    • Canals

    • Railways

What are some advantages?

    1. Quick travel

    2. Increase in the amount being transported

Free Trade & the Reciprocity Treaty

  • Free Trade: When all tariffs on foreign products are abolished

  • By the mid-19th century, England had changed its views from a protectionist policy to a free trade policy

  • This means that England was no longer only buying resources and goods from its own colonies, but from foreign countries as well\

  • How does this effect Lower Canada’s economy?

  • Economic liberalism instead of protectionism will lead to wealth (Adam Smith)

  • Canada was left with no steady trading partner

  • Turns to the USA, who was open to trade with

  • Creation of the Reciprocity Treaty in 1854: no tariffs on raw materials traded between Canada & USA

  • Mainly agricultural products & wood



Anania, 2015-2016




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