Business Secretary Kemi Badenoch says “British ingenuity and industry” led to the economic success of the UK, not colonialism.
Mr. Niemitz, the IEA’s head of political economy, argued colonialism made a “minor contribution” to Britain’s economic development, “and quite possibly none at all.”
He said the costs of administering a huge empire and paying for an army and navy to protect it outweighed the benefits from trade.
Ms. Badenoch, who is expected to challenge for the leadership of the Conservative Party if it is defeated in the general election, said the study was “a welcome counterweight to simplistic narratives that exaggerate the significance of empire and slavery to Britain’s economic development.”
Badenoch Says Blaming Colonialism ‘Holding Back Growth’
“It is these factors that we should focus on, rather than blaming the West and colonialism for economic difficulties and holding back growth with misguided policies,” added Ms. Badenoch, who got 59 votes in the last leadership contest in 2022.
In the paper Mr. Niemietz disassembles the theory that the profits from slavery and colonial trade provided the capital which triggered the Industrial Revolution in Britain.
He said the idea has regained popularity since the Black Lives Matter protests of 2020 which led to “a renewed focus on the UK’s imperialist past” and the removal of statues like that of Bristol slave trader Edward Colston.
He said the idea was originally known as the Williams thesis after the Trinidadian historian Eric Williams, who wrote in 1944, “The profits obtained [from colonial trade] provided one of the main streams of that accumulation of capital in England which financed the Industrial Revolution.”
Mr. Niemietz points out that nowadays educational materials for schools provided by BBC Bitesize say: “The slave trade was important in the development of the wider economy. Financial, commercial, legal and insurance institutions all emerged to support the activities of the slave trade.”
But Mr. Niemietz said the trans-Atlantic slave trade was no more important to the British economy than brewing or the production of wool.
He wrote, “Slave-based sugar plantations added just under 2.5 percent to the value of the British economy at its peak, less than the share of sheep farming.”
Mr. Niemietz wrote, “Profits earned from overseas engagement were large enough to make some individuals very rich, but they were not large enough to seriously affect macroeconomic aggregates like Britain’s investment rate and capital formation.”
He also pointed out countries like Germany and Switzerland became rich and industrialised in the 19th century without establishing empires, while Spain and Portugal, which both carved out slave-holding empires “consistently performed below the European economic average.”
Historian Says ‘Absurd’ to Deny Colonialism Spurred Economic Growth
In a blog post, Mr. Lester said it was “absurd” to deny colonialism spurred Britain’s economic success and described it as “self-evident.”He wrote, “Historians have demonstrated in thousands of research publications that British investors’ ability to appropriate land and subordinate people in some 40 overseas colonies, ensuring a supply of commodities such as tea, cotton, opium, rubber, meat and wool produced with free or low-cost labour, made a significant contribution to Britain’s economic growth.”
Mr. Lester wrote on X: “As night follows day Kemi Badenoch makes a speech denying that Britain’s economic growth had much to do with colonialism. The IEA, having burnt through [former Prime Minister] Liz Truss, backs the next ideologically-fixated, right wing contender for the Tory leadership with a ‘report’ saying what she’s just said, but with some cherry-picked citations.”
