52 Chapter Two
balance between the two governed the scale of trade and the number
of ships that showed up to pay dues.^56
Though details are beyond recovery, it is reasonable to think that a
process of trial and error gradually defined the acceptable limits of
taxation a local ruler could exact from passing merchants and traders.
If he lowered the costs of protection and harborage he could hope to
attract new business; if he took too much, he would see traffic dimin
ish sharply.^57 A ruler who took too little (if there ever was one) might
not be able to maintain effective armed control of his territory or of
adjacent seas. One who took too much might suffer the same fate, if
ships and merchants succeeded in eluding his grasp to the detriment of
his income. In other words, a kind of market asserted itself among the
political rulers of the shores of the Indian Ocean, setting what can be
called protection rent at a level that permitted the continuance and
(after 1000 or so) the systematic expansion of trade.^58
This system may well have been very old. Presumably, ancient
Mesopotamian kings and captains began to define protection rents in
the earliest phases of organized long-distance trade. Assuredly, the
Moslems, when they conquered the Middle East (634–51) brought
writh them from the trading cities of the Arabian peninsula a well-
articulated idea of how trade should be conducted. The Koran af
forded appropriate sanction,^59 and Mohammed’s early career as a
merchant offered a morally unimpeachable model. The impulse to
wards broadened market behavior that came from China’s commer
cialization was therefore a reinforcement rather than a novelty.
- On Malacca see Wheatley, The Golden Khersonese, pp. 306–20.
- Sung records nicely illustrate how the system worked. In 1144 officials raised
import duties to 40 percent of declared value, only to see trade languish and receipts
diminish, with the result that in 1164 the old rate of 10 percent was restored. Lo
Jung-pang, “Maritime Commerce,” p. 69.
- My conception of how merchants and rulers interacted along Asia’s southern
shores is largely shaped by Niels Steensgaard, The Asian Trade Revolution of the Sev
enteenth Century: The East India Companies and the Decline of the Caravan Trade
(Chicago, 1974), pp. 22–111. Steensgaard describes a situation existing about 1600, and
he is concerned primarily with caravan trade; but the strategy of trade and taxation
probably did not much alter from early times until after 1600, and rulers’ relations with
merchants who traveled overland were not notably different from those who came in
ships. The concept of “protection rent” was invented by Frederick Lane, “Economic
Consequences of Organized Violence," Journal of Economic History 18 (1958): 401–17,
and his investigations of medieval Italian enterprise in the Mediterranean also provided
me with a model for what I believe happened along the shores of the Indian Ocean.
Lewis, “Maritime Skills in the Indian Ocean,” pp. 238–64, offers a very suggestive
survey of the subject, though he does not raise the question of relations between rulers
and merchants directly.
59– Sura IV, 29: “O Believers, consume not your goods between you in vanity, except
there be trading by your agreeing together.” Arthur J. Arberry, trans., The Koran
Interpreted (London, 1955).
