Canadian economic history is often taken as an obscure and comprehensive subject. From the time Canada was a colony of Great Britain, to the official proclamation of the confederation on July 1st 1867, Canada adopted many economic ideologies that established Canada as developed nation. Mercantilism is one of many of the earliest theories that the Canadian economic system adapted from the Great Britain.
According to Dyer, “Mercantilist system relied on trade with the colonies to supply the mother country with raw materials, where the end goal was a trade surplus and accumulate a treasury that was used to fight wars with one another.” As history progressed, Canada was shaping up to be independent state and incorporated new ideologies during the transition. Corporatism is one of many theories that Canada adopted and transitioned to fit within its framework after Mercantilism. Corporatism was a reaction against the social and political thought of capitalism and political conflict between classes. The transition from a mercantilist school of thought to corporatism paved the economic history of Canada to what it is today.
One could still see the path of this transition by assessing the path dependency of the oldest corporation in Canada. Hudson’s Bay Company (HBC) was founded in the late 17th century. It was largely a fur trading operation through the idea of monopoly. HBC was founded upon the principles of Mercantilism with the guidance of British ideologies. As Canada transitioned towards an independent and self-sustaining state, companies such as HBC transitioned their company’s ideologies accordingly. This paper will focus on how HBC has fit into a mercantilist framework and how over time it has developed into a sophisticated corporate operation. Analyzing the emergence of competition in Canada was a key determinant of this transition. Moreover, the regression and the shift from the fur trade has also played a vital role. Lastly, the adoption of modern corporative management also developed the corporate framework within HBC. Using HBC as a case study, one can agree that Mercantilism and corporate philosophy has played a vital role in the economic history of Canada, and how the economy has shifted from one ideology to another.
HBC was largely a trading operation that was not only expanding geographically but also with their operation over a span of 200 years. The rise of competition led to a regression of HBC’s market share. Unfortunately, with the ideas developed under a mercantilist framework, HBC could not keep up with its operations against the Northwest Company. The entry of competitors such as Northwest Company founded by French traders, created a duopoly in the market. The duopoly in the market was an indicator to HBC that they need to come up with a competitive strategy. Over time, their competitive strategy had changed to profit maximizing as compared to the volume of supply. Mercantilist companies, such...