The Fur Trade
[Slides 1 – 5]
Competition increases – British and French colonizers entering the market.
Fur trade causes permanent settlement, but limits amount of settlement (small
population of colonies) because it does not engage a whole lot of people for the
King of France becomes concerned (by 1660s) about the fur trade with Colony “New
France” because the population is not growing and a lack of economic base. There is
too much reliance on the fur trade, neglecting things like agriculture.
Decides to move in and control the colony himself [appointed officials] – sets up
Royal Government, power away from the business people. Officials, some of whom
are struggling financially, are able to use their power for personal gain.
Royal Government’s Goals:
- Limit Fur Trade – pay more attention to other viable economic sources
This does not work well because the Fur Trade is the most readily available
(short-term) economic activity; the same reason why the appointed officials
are choosing this activity over other economic prospects for the quickest
- Encourage population growth
Result: More expansion of the French Fur Trade, further European expansion into
North America. By 1670, formation of the Hudson’s Bay Company developed by fur
traders, Radisson and Groseilliers. They approached the English about the
company. English Royal Charter (1665), King grants them a monopoly to exploit all
resources in the land that naturally drains into Hudson’s Bay (Large area). Strengths
of having HBC in the Fur Trade:
- Gain demand of Natives, because French don’t have posts set up in NA
- British have naval advantage/experience
- Has and maintains confidence for investors; developing into a major fur
Business In New France 1663 - 1763
Becomes a Royal Province in 1663, power shifts from merchants to King.
Mercantilism (use colonies, exploit resources to support mother country; France)
drives economic policy of European Powers. Purpose is to create a self-sufficient
and wealthy empire with enough colonies all over the world (not reliant on trade).
Economic growth in New France was underdeveloped. British was developing
much more quickly in similar areas on NA.
Colonial Officials = motivated by self-interest, not by colonies best interest.
British colonies, once colonies are settled, give colonies some internal control (self-
governing). Legislature is elected and officials often stay there long term so will
look out for the benefit of the colony, more so than French officials.
Ongoing wars are bad for both French and English business, very destructive and
discourage investors who fear their investment being ruined with war. New France is a low priority for the empire, partly because it is not the most
profitable company and actually costs money to run/maintain.
Trade Economy of NF
Export trade economy develops, 70% coming from fur exporting. Agriculture,
however, is the dominant activity of residents of France – required for some degree
of self-sufficiency. Agriculture makes up a very small percentage of exports; it is
consumed almost entirely locally.
NF depends of France (& some other countries) for many imported products. This
leads to a trade deficit in most years.
Merchants of NF
Merchants invest in, execute or involved in the movement of goods. They operate in
distinct networks/communities, inter-connected by ties of kinship – ensures
working with people you trust.
Robert Dugard 1730: began interest in the trading industry. Established a
merchant trading firm with other family members in the trade business. Has a fleet
of 8 ships, factory and a staff of agents in Canada.
French Colony Policy
1663 – New France becomes a royal province
The main economic policy of European powers was mercantilism (rather exploitive
of colonies by the mother country):
- Objective: create self-sufficient and wealthy empire
- Colonies to supply materials to the mother country and act as a market for
Manufacturing is banned in the colonies to maximize profits of the mother country.
State may have encouraged some small production (ie. Ship building) probably so
they can be less reliant on the mother country. Import most finished goods.
Can’t be a manufacturing powerhouse:
- Lack of skilled craftsman – colonial officials not interested in the long-term
idea of production over the short term fur trading. Population in general is
difficult to attract to living in New France crappy opportunities, climate
- Lack of capital to get things rolling. Ex. State had to invest in ship building
- Very few products that could be produced as cheaply (remaining
competitive with pricing) as New France and others – could not compete on
pricing in the industry
- Population is small Market for manufactured goods is small cannot
support a manufacturing industry
Agriculture in NF
One of the more productive components of society (80% of population is rural) ¾
of domestic output. Production is increasing over the years.
Impedement: Seigneural System - Land-holding system Land was not sold to farmers. Land divided into
long, large sections (all access to water – best farming lands) and appointed
to nobles or other high-ranking people in society (ex high paid merchant).
They then divide they large chuck of land into smaller, individual farms.
These are then rented out to common farmers
- Problem: taking the wealth of the farmers and putting it in the hands of the
colonial officials/nobility, who aren’t particularly entrepreneurial. Farmers
and people aren’t getting the money to be active consumers. If nobles are not
re-investing this money, all potential wealth of the agriculture sector is being
Fur Trade – Part II (1760 – 1860)
French lose their NA colonies to British
American Revolution – rebelling against British Control in 1770s and they win that
war for US independence. British lose large amount of their colonies. British
pushed north to modern day Canada.
Impact on Fur Trade:
- New traders (Scottish, English, American [already in the trade network]), but
does not decline overall since old players are replaced
- French Canadian merchants fall out of business - lack of English contacts.
Many leave to France (mostly officials and high traders, many regular
citizens stay) or go/are sent to other colonies. Scottish, Engl & American fill
the gaps. Lower level merchants remain, just not the higher-level
- Expands to Northwest; Increased competition
- Competition and anarchy in the north west
o Problem 1 – competition degrading into violence
o Problem 2 – increased use of alcohol in the trade also contributing
to the violence
* It is difficult for HBC to enforce any sort of monopoly they may have around
Hudson Bay -- no courts or legal system set up in NA at this time. British claim
(known presence) comes simply from the traders that occupy the land.
Too much competition and too many players! And without the laws, they descent to
violent anarchy to support their own interests.
In response to problems of competition:
- Expansion move into new areas that it previously had not been
o Limited only so much space that can be effectively travelled too and
goods shipped in and out of easily
- Merger Most of the main fur trading firms out of Montreal, and eventually
the independents (smaller firms), merge into Northwest Company in 1779.
o Improves efficiency not matched by all the smaller firms competing
o Easier shipment of goods around NA
o Replace many competing posts in same area with one post in one area
to compete with HBC Two main companies now trading are Northwest Company and HBC
The North West Company
Operates on a partnership model Two kinds of partners:
- Ones who operate out of Montreal and take care of arranging transport of
goods in and shipment of furs out.. Arrange for financing for head of NWC
- Wintering Partners: Heads of the various posts on the interior of NWC
trading with the native people. Equal partners with the merchants in
Payment is based on a profit model (dependant on how much the company makes)
- Ensure the loyalty of your wintering partners since their payment depends
on successful operating of business Motivated and Committed
Annual Meeting b/w partners transfer of goods/furs. There is lots of
coordination involved and a fairly expensive venture.
Simon McTavish - One of initial merging partners from Montreal.
Entered the fur trade after the French surrendered in NA to help fill the gaps left by
the French defeat (1760). Has a connection in London to aid in the fur trade –
strong connection into business. Operates as one of the Montreal partners.
Alexander Mackenzie – Montreal Company absorbed by NWC a few years after its
creation. Made a wintering partner in the firm and sent into the far north
Outskirts of trade post territory. He is sent there as a skilled explorer (map skills,
understanding of geography, etc.). Attempted to find water route through the
Rockies to ship some goods from the Pacific Ocean. This would help reduce the
lengthy and expensive process of transferring goods across Canada over land.
Had native guides that, perhaps out of misinterpretation, led him to the Arctic Ocean
Mackenzie River names after him. Eventually finds the Faser River to the Pacific,
but not a feasible route through the mountains.
Competition of HBC and NWC continues to grow, fighting for natives and furs.
Overhunting is causing lower levels of animals to harvest for furs. A Merger of the
two main firms was considered, but does not immediately happen. Violence and
anarchy run more rampant.
Selkirk Colony – Lord Selkirk – member of Scottish mobility, major investor in HBC
- Wants to create colony for Scottish farmers
- Using investor influence to establish colony in central Canada (modern day
Winnipeg – on two major river systems – area where agriculture is possible).
This is on a major trade route for NWC and in an area occupied by natives
providing provisions for the NWC.
* Metis Mix of natives with European influence
Battle of Seven Oaks 1816 results.
Result: Consolidation of the two firms (50/50) HBC and NWC, 1821. HBC name
kept because of reputation gained.
Demand for furs is declining, cannot support this now massive firm (despite the
HBC Monopoly in the trade). New products/materials being used more and more in
replacement of furs. George Simpson - Restructured company to keep it profitable and running after the
- Cuts number of fur trading posts in half
- Cuts number of employees by over 50% and wages by about 50%
- Drops the ‘price’ (goods in exchange of fur) that natives receive from HBC
- Introduces quotas will only accept so many furs from certain areas from
the natives (reduce supply of furs to keep prices higher/stable)
Competition and Illegal trade
Staple export – done in the winter so that the spring melt could be used to transport
all the timber to merchants around the country
Colonial Merchants – invest in trade and production
Philemon Wright – American farmer coming up (with group of settlers) to grab free
or cheap land (just being settled/established). Expands through purchase of more
land. He realizes need for additional resources to fuel the farming industry [Ex. Saw
Mill – cut and prepare lumber for masses of people] [Ex. Tavern to service the
Timber Workers – harsh, not well paid; under desired. Often are recently arrived
immigrants or, in some cases, are farmers in their down (winter) months.
Sawmilling (Lumber Industry)
Industry develops around 1850; grows beyond just being a service and providing
wood to a community now using export markets. The area directly below
Ontario in the States was developing and growing which provided an increase in
demand for lumber. Canadians were able to export lumber to them.
Free Trade (with Britain and US) is established – boom to the lumber industry
(trade becomes more open – specifically Quebec could trade with the States). Free
Trade agreement b/w Can. And US (1854 – 186_) that increases the trade b/w the
William Price Clerk for company supplying timbers to the Navy. Learns the
business and goes out on his own to form the William Price Company – Originally
provided wood directly to shipping yard of Navy. Begins to move into sawmilling as
well – buying out several small sawmills which he expands. Dominates the
sawmilling industry in the area soon enough. [Found the link (need for) to
sawmilling from the forestry/lumber industry]
75% of population living in rural, agricultural areas.
The development of the farm economy grows very quickly – lots of available farm
land (European immigrants). Productive by 1830s and 40s – the best agricultural
land in SW ON is taken as far as incoming farmers are concerned new areas like
Huron, Bruce and Muskoka are opened up (Not as good at Waterloo region and other better areas). Price of land is also starting to increase as a result Concept of
mortgages begins to expand or keep farms for their families in the future to
continue farming competitive for land.
How important is Wheat to the Ontario economy? It is one of the biggest exports
(represents surplus of goods to sell indicator of commercial farming). There is a
wheat boom by 1950s, with increasing amount being exported. Wheat is only about
20% of the agricultural output (Speaks to the overall size of the industry). Wheat
still helps to initiate economic growth and development, comparable as an export
only to Timber.
Indicators of Profit:
- How early they got land
- Quality of the land
- Location to transportation (water systems) (development of trains by 1950s)
Agriculture in Lower Quebec
Also the dominant economic activity. Quebec faces a few more challenges than
- More subsistence and potentially unprofitable farming.
o General population increases dramatically leads to a “land crisis”
o Start to open up new areas for farming, but not as quality.
- Seniorial System restricts the industry (large estates are owned by members
of the elites and farmers rent land). Quebec farmers have additional costs
(rent). They have less wealth in their hands of the public this restricts
further expansion and economic stimulation from the consumers/population
(75% living in rural/farming areas).
They shifted away from wheat growing Lower overall output than Ontario. They
are still producing a surplus, just not as much and their industry does not stretch as
far. Shifts from wheat to other crops (still running a surplus). Since they cannot be
competitive in wheat, less profit is accepted in products that they can compete in.
Railroads and Early Industrialization
Ontario and Quebec make transition from a commercial export economy to an
industrial, capitalist one transition from old crafting methods to more
technological methods of production. Critical Period = 1850 – 1870:
- Important changes that occur (to allow development of manufacturing sector
to allow industrialization):
o Economic Policies – removes preferential treatment of nobles and
officials. No longer encouraged to only do trade within colony. More
potential markets outside the empire. Manufacturing sector now
possible, since it is no longer suppressed. o Canada (UK) and US Free Trade Agreement – encourages/strengthens
trade and interaction b/w US and Can. Growing demand in US for
products that Ontario has to offer (eg. Lumber) US areas under a lot
o Technological development – Eg. Trains allow easier movement of
goods to further markets and in greater quantities. Eg. Telegraphs –
first major improvement to communication. Assisted with
administration issues on the country (appointing officials, assisting
with business development, etc) allowed businesses to have other
branches throughout country (Eg. Banking)
o Banking – develops early/mid 1800s in Canada – encourage new
forms of industry and development since banking allows for much
easier movement of money and facilitates credit to increase business
Industrialization – Ontario (by 1870)
Nature of the industry:
- Manufacturing sector begun to develop, but generally small shops with few
- Under-developed early establishments continue to use traditional
craftsman methods (hand crafted/using hand tools). Not enough
technological and mechanical development being utilized yet.
- Most establishments in rural areas, rather than centralized to urban areas –
manufacturing sector began as small shops producing just enough to support
their local community
Increasing Diversity in Canada’s business:
The economy moves into other vouchers away from the export/staple economy.
Early on, 2/3 of manufacturing establishments were either saw mills or gristmills –
need for lumber tied to staple/farming economy. By 1871, these mills account
for only 13% (even though their numbers grew, so many other (diverse)
establishments have been established machinery, farm tools, furniture, textiles,
etc (meeting about 80% of the provinces needs for goods) now being produced.
Example: Gooderham and Worts:
James Worst – came to Toronto in 1831. Establishes a gristmill on Toronto
waterfront. Dies in 1834, son eventually partners back in. Brother in law, William
Gooderham. They are doing well, surplus of grin coming in expand the mill into
brewing distilling since wheat is also used in that, this becomes the company’s main
business. By 1859, larger distillery built on access to the main railroad in Toronto.
Producing ¼ of all rye (liquor) in all of Canada Largest distillery in the British
Empire by the 1860s.
Why in Ontario? (How did the land assist in the development of the establishment?):
- Ontario was rather focused in production of wheat (surplus wise) – this
business took advantage of those high levels of wheat production.
- Makes sense to be in the heart of an agricultural community (Toronto) when
opening a wheat mill and using wheat businesses - Market exists for liquor/spirits
Toronto became the center because of the central location and the proximity to
main train routes.
Why is there development (diversity) in Ontario?
- Success of agricultural economy – creates surplus income to allow people to
act as consumers and even investors in other business initiatives.
- ‘Merchant Elite’ – did not hinder the development of industry. Some policies
were introduced to encourage industry:
o Ex. Protective Tariffs for the manufacturing sector tax on imports
to encourage business within local businesses.
- Railway Development – encourage manufacturing:
o Revolution in the ability to move goods and people – more efficient
and over all types of Canada’s harsh climate.
o Access to further and further markets to expand industry.
o Create a market themselves facilitate the manufacturing of things
like trains, train engines, etc. and require service operations to offer
more diverse business ventures.
- Location and Resource Factors – in good proximity to US access to
markets/goods of the US.
- Quick population growth of Ontario – waves of immigrants in 50s and 60s
hoping to be farmers, but land is harder and harder to access and becoming
more expensive to access. They need another way to get established and
make money (possibly trying to save to buy a farm). This creates a large pool
of labour that can be exploited rather cheaply (keeping costs down).
Kitchener is an established industrial city (Called Berlin at the time). Farily
prominent manufacturing city Why Kitchener?
- Early established city strong agricultural community on the river system
- Grand Trunk Railroad (most crucial/most important at the time) running
- Testament to the craftsmanship of early German immigrants
Industrialization of Quebec
Merchant Elite – they own things and are the ones investing more so than the
general public. Similar Tariffs as Ontario. 1854 gets rid of sensorial system – seen
as an impediment to economic development.
EXAMPLE = John Molson & John Redpath:
- Molson breweries – Molson was a merchant at first, initial financier behind
Canada’s first bank (Bank of Montreal) Merchants develop banks to
encourage merchant trading. Creates Brewery.
- Redpath is another Quebec merchant Sugar. Engaged in development of
canal system on St. Lawrence (facilitate movement of their goods).
Constructed first sugar refinery in Canada.
- Actions are more urban-centered - Smaller output than Ontario (Ontario accounts for 50% of production in
Derived from the invention of steam power. Change everyday lives, but facilitates a
lot more trade and business interaction to grow business, and are businesses in and
Supported by all – business community, famers, political officials and
Financing (Expensive to build, operate and maintain trains) mix of Public (State)
and Private (business) development. Merchant elite does not have enough money
for the whole investment Banks are initially unwilling to give loans for railroads.
They are considered to risky of a venture and banks are still very conservative.
Partnership develops b/w business and the state since it is mutually beneficial and
must work together to make railroads happen.
Some businesses wanted to invest and make money that way. OR
Run a railroad business in and of itself. (EVERYONE IS INTERESTED):
Governments seen as necessity; Do not want to fall behind to other colonies or
other countries like the US that are developing faster/further ahead. General social
goods improved transportation and communication “Public Good” must work
together with private businesses:
Eg. Guarantee Act 1849 government will guarantee/back up interest and
principle of railroad debt to encourage investment (will not lose your initial money).
1. Great Western (1854) – covers SW Ontario and links to American rail lines
2. Grand Trunk Railroad – proposed to link two other railways together to join
all the colonies by rail (inter-colonial rail line). Financers could not be found
because it was too expensive and too risky. Eventually, it connects the most
populated and centralized manufacturing areas on Ontario and into Quebec
City. Completed 1859. Business advantage: increased trade, business
activity (specifically b/w on and Quebec)
Financial Failure – very long rail line, construction costs, operational costs,
etc there is not enough movement of goods and people on the tracks to
become profitable, or even repay investors. State continues to bailout the
railway directly and indirectly Government assists banks that are loaning
to the railway and not doing well as a result.
Most early railways do not earn any money, requires the support of governments to
William Mackenzie get into generation part of hydroelectric business approached
the Ontario government for permission to establish a hydro generating plant on
niagra falls (Electrical Development Co.). This is probably the last good site for
generating electricity in Niagra Falls. What will the cost be if this company is
given essentially a monopoly
We want more energy, but at what cost?
If its private and they decide not to provide power to a town, its economic
development will decline.
Adam Beck politician/business man in London; runs for London rep for ON
legislature. Government should create regulatory committee to ensure that all
municipalities in ON are equally exposed to electricity at reasonable rates.
Ontario Hydro Electric Commission
- People appointed to it; Purpose is two-fold:
o Regulate price of hydroelectricity (maximums) [PRICE]
o Insuring infrastructure is built with access to more remote locations
- Building generating plants and distributing to more and more places as
industry expands (largest company in field) Run by public company that
would eventually become Ontario Hydro. Pushed out the private sector.
Further rail development in late 1800s/early 1900s
CPR Company Recognition that the railway would face difficult times after its
completion (1885), due to cost of financing (hard to make profitable to keep it
Fairly financially stable company (unlike many earlier railways like the Grand
Trunk). Effective business management
Diversification (innovative) – Ex. Tourism [railway goes through the
Rocky Mountains = beautiful terrain. Many Canadians are drawn to the idea
of the wilderness (patriotic?)]. Potential market is still people with money
(would be expensive to do for most people). Begin to build hotels along
the railroads (Ex. Banff Springs). Mining (Ex. Cominco) -
Trans Continental rail – another idea develops as soon as CPR finishes eventually
government approves it. Provincial governments and farming groups are arguing to
federal government that there must be competition in the rail business. Primary
transportation link b/w east and west – farmers will be forced to use these rails to
ship their goods and are concerned about a monopoly and the expensive prices that
- Built toward southern parts of Canada (where settlement occurs) Government ends up regulating wage rates anyway (did the increased competition
Federal gov’t allows for the building of two more trans continental rails (completed
grand trunk line & Canadian Northern) Does not save the Grand Trunk (too many
economic problems – nation does not need 3 trans-continental railways). The gov’t
in 1920 does not allow these railroads to fail amalgamate them all together to
become the Canadian National Railway to save them all.
Revolution in retailing
- Smaller retails (general stores) would use barter system – new one demands
standard cash payments (high volume and low prices also).
- Why are we getting these larger retail operations operating in more markets
and over larger distances?
o Move to industrialization growth in population increase in cities
(autonomy is more apparent in urban areas – so many people don’t
want to pay credit, but demand cash payments).
o People consume more than they produce (consume what you need,
but not producing what they need). Increase in demand for retail
o Development of public transportation people can purchase beyond
their immediate neighborhood – can access further stores Market
Timothy Eaton (1903) – ‘Rags to Riches’
- Born son of tenant farmer in Ireland. Early 1800s the farming sector is in a
crisis – farms are of smaller and smaller size Hard to have a family and
many farmers are being pushed off their land (eventual famine throughout
the 30 and 40s). Immigrate to Canada (1820 – 1850s large Irish
- Born 1834 – went to school until 1847 (height of agricultural issues) at 13
and begin apprenticeship of a general store owner.
- Settles close to Toronto (Georgetown?) and opens a general store (2
- Opens store in Toronto in 1869 (Young St.) – initially a dry goods store
transitions into larger retail operation.
- Begins the idea of Cash only and fixed prices (prices had historically been
negotiable and people would barter) – generally cheaper goods however
because you are moving so many goods he could afford to sell them for less.
- Directed sales to both the upper and working class (innovative for the time) - 1870s - Begins buying directly from manufacturers (rather than from
wholesalers – the middle men). Keep prices low and # products up.
- 1890s – Manufacturing – some of the products being sold in stores
o Ex. Clothing manufacturing
Change in the way they clothing is made Quality is
decreased because skilled tailors are replaces by unskilled
workers, but prices are lower.
- Mail order service 1884 – access people outside of Toronto (before branches
were made outside of Toronto in early 20 century) – expand
o Produce a paper catalogue showcases all goods and allows you to
order goods to where you live. (Revolutionized by Eaton) A lot of
Canadians lived in smaller, rural cities who didn’t have accessibility to
the same range of goods that the Eaton’s stores were offering.
- Sales and guaranteed refunds began being used more and more. Sale on
goods to increase sales of certain goods at certain times (ex. Coats go on sale
near end of winter)
- Fashion shows in stores (events like this were used to bring people into
- Began the Santa Clause parade – advertising
- Began the idea of having departments within stores (within departments of
goods and also divisions of business) – increasing product line led to having
to organize/categorize the goods. More efficient operations.
o Management was based on merit even Eaton’s children
- Branch stores introduced (first in Winnipeg in 1907).
Innovate techniques throughout life to increase sales and effectiveness of stores.
- Decline of Eatons:
o Over-expansion in the 1970s introduced a chain of discount stores
(“Horizon”), but they failed (large monetary loss). Revitalization
plans for downtown city areas (shoppers moving out of downtown
with the development of malls in the periphery of cities) –
manufacturing has also moved from downtown areas.
Attempted to create downtown malls (Eatons would be the
anchor store) Monetary failure – parking issues, etc. w/
downtown location. Stores left malls – no one wanted to go to
a half empty mall.
o Poor family management
Poor responses to competition in 80s and 90s
Did not renovate stores
Lower variety of products
Cost cutting techniques (opting out of catalogue and parade) Iron and Steel
Important industry for industrialization and manufacturing need steel to produce
many other goods.
- Support industry to the manufacturing sector
Developed in late 1800s. – Must be operated as a large industry rather than on a
- Cost of establishing facility (technology and equipment)
- Methods use furnaces and other equipment that needs to be kept running
because of cost with a high output to be profitable
Other Obstacles/Challenges to the Industry:
- Lack of primary resources that go into iron and steel production (i.e. iron
ore) far away/difficult to mine (requires capital and technology to extract
and refine these materials)
- Small market, even w/ development of manufacturing industry
Begins in the Maritimes (did have iron ore available)
- Beginning to industrialize by late 1800s (later than Ontario/Quebec)
Tariffs enforced on imported goods to encourage manufacturing (problem for
Maritimes and the ship business end up embracing manufacturing Look to
Iron and Steel, Why?
- There is a need/demand
- New industry that was developing
- They have an advantage in iron and steel over Ontario and Quebec
o Actually have coal fields
o Greater access to iron ore deposits
NS Steel Company / New Glasgow Iron, Coal and Railway
- Can begin to process iron (integration of different components of the
industry – iron was previously imported)
- Secure ore supply from Bell Island
- Coal properties on Cape Breton
The two companies merge together – making the most fully integrated industrial
complex in the country (size of operation) (Merged into Nova Scotia Steel)
Acquired secondary industries as well (extensive operation).
- Producing secondary material (finished products??
Expensive to ship their goods to the rest of Canada for sale.
- National policy imposes their will to do business with foreign markets
because it is easier than shipping all over Canada 1899 Dominion Iron and Steel forms – another integrated iron and steel operation
Secondary (nails, screws, etc.) iron and steel products in the works.
Primary industry attempts – failure
1899 Hamilton Steel and Iron Co.
- Importing coal and iron ore from US
- They had an emphasis on metal products already that complimented this
- Railways and water system access
- Government support to encourage business growth in Hamilton
o Free 75 acre site to locate these establishments
o Bonus of $100 000 if manufactures chose this site
o National Policy (Federal level) – American technology and investment
Interested because being produced in Canada means they can
avoid their American tariffs.
Further consolidation in the iron/steel industry
“The Big Three” = STELCO (Ontario-Hamilton), BESCO (Maritimes) and Algoma
(Northern Ontario – St Maire)
Limitation to industry development:
- Competitive pressure to secure the industry (three large competing
- STELCO produces wider range of secondary products, the other two limit
themselves to primary sources of profit (losing profit to other Canadian
Companies and American iron and steel companies) Automotive Industry
Reveals two main themes:
1. Foreign ownership (investment and dependence)
a. Increasing role in Canadian business (i.e. forestry and automotive)
2. Nature of how big business operates
Development of technology happened in France in 1880s and 90s. The US will
become the international leaders in this industry very quickly (by 1930s):
- Added innovations onto the idea of manufacturing cars
o Assembly line (each worker doing a repetitive and simple part of a
complex engineering process = revolutionary)
Increase volume of production
Take advantage of low paid, unskilled workers
o Mass production/marketing/sale (sell more product)
Assembly line advancements bring the cost of the product down making it more
available to ‘average’ people (cars were previously only available in terms of price
for the elite).
Henry Ford – pay workers enough that they could afford the cars themselves.
Canadian Auto Industry
Few Canadian owned companies survive.
- Resource limitations
o Financing problems – could not convince banks to give loans
practical investment considerations:
o Market = small
o Infrastructure (i.e. roads) is very poor at this time (governments
reluctant to spend money) difficult for sup