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INTRODUCTION ["Capital, Containment, and Competition: The Dynamics of British Imperialism, 1730–1939" by Julian Go, 2014]|

What causes imperialism? The earliest theories came from Spencer (1902: 180–200) and Hobson (1965 [1902]) who sought to explain Britain’s territorial assaults on Asia and Africa in the late nineteenth century (Semmel 1993: 103–30). Spencer emphasized the culture of militant nationalism. In Spencer’s view, British society was undergoing a “re-barbarisation” partly manifest in a jingoist press and parliament. Im- perialism was the direct result (Spencer 1902: 180–200). Alternatively, Hobson (1965 [1902]) argued that British imperialism resulted from a build-up of excess capital. Facing underconsumption in England, financiers transferred their capital abroad. They then pressured the state to annex new territories in order to protect their investments (Hobson 1965 [1902]: 80). These theories in turn inspired Schumpeter’s thesis of “social imperialism” (1951) and later Marxist theories of imperialism (Arrighi 1978; Harvey 2003; Hilferding 1981; Lenin 1939; see Baumgart 1982: 109–11; Brewer 1990; Mommsen 1982; Semmel 1993: 163 for a review).
Considering that the British empire was one of the largest and most influential empires in the modern world, it is fitting that British imperialism has been the site of initial theorization. Yet three limitations impede a richer understanding. First, the Spencer-Hobson tradition overlooks the role of the imperial state. By definition, imperialism involves state action: the sort of imperialism theorized by Hobson and Spencer, that is, formal (or territorial) imperialism, means that the state declares sovereignty over foreign territory to make it a colonial dependency. 1 Yet classic the- ories of imperialism treat the state as little else than a siphon through which other forces flow, as if the state has no interests of its own. Second, classic theories illumi- nate the domestic (or “metropolitan”) factors propelling imperial expansion. We get little sense that the imperial state operates in a wider global system. Finally, classic theories and subsequent research has been silent on broader historical patterns. The original theories of Spencer and Hobson focused upon British imperialism in the late nineteenth century—the so-called new imperialism. Similarly, other studies examine particular cases of colonial acquisition or specific historical moments but not broader temporal or spatial regularities (e.g., Baumgart 1982). Time-series data on the number of colonies acquired by Britain shows that British imperialism has had a longer career than existing theory and research implies (figure 1).
So what drove these imperial dynamics over the long durée? In addressing this question, the present essay develops an explanation that goes beyond the limitations of the Spencer-Hobson tradition. It shows that British imperialism was not produced by the ebbs and flows of militant nationalism, nor was it driven by internal economic requirements or the needs of financiers. It was rather produced by structural compe- tition. Imperialism was a strategy for meeting the state’s imperatives of geopolitical security (containment) and economic growth (capital) in the face of external threats. Such threats were most likely to be perceived when the global system was at its most economically competitive.

Theorising Imperialism

The structural-competition explanation induced from the present analysis builds in part upon various works on imperialism that have already transcended the analytic confines of the Spencer-Hobson lineage. While both Spencer and Hobson emphasized domestic causes and overlooked state interests, these other studies suggest alternative approaches that highlight global factors or state imperatives. The first is a “trade regimes” approach from world-systems research. This approach has been developed to explain colonization in the entire world system rather than by an individual state (Bergesen and Schoenberg 1980; Boswell 1989; Chase-Dunn and Rubinstein 1979; Pollins and Murran 1999), but it can be adapted to also theorize British imperialism. This approach suggests that global trade patterns oscillate historically between phases of free trade and periods of mercantilism (marked by high tariffs and constricted international flows). 2 Free trade periods mean less colonization because states prefer open markets. But when free trade declines, states respond with colonization in an effort to obtain and maintain privileged access to materials and markets (Boswell 1989: 185). Imperialism is a functional alternative to open trading systems (Bergesen and Schoenberg 1980: 242).
Other approaches include “Realist” approaches such as Realist International Re- lations theory and variants (including historians’ research). These explanations bring in global factors while emphasizing state interests. In classic realism, imperialism is the result of the states’ rational pursuit of interests. All states seek to maximize power, new territory adds to states’ power, and so states naturally seek new territo- ries. What determines whether or when states will pursue territory is their capability. States will expand when they can; that is, when they are militarily stronger than other states (Morgenthau 1978). Variants of this approach include “state-centered realism,” which emphasizes internal capabilities rather than military power. States will expand when they have the organizational capacity to do so (Zakaria 1998). Alternatively, “defensive realism” asserts that states expand when they must (rather than when they can); that is, when their security is threatened (Snyder 1991). This latter approach surfaces in other work too. For instance, some historians suggest that Britain’s new imperialism was a response to rival’s colonizing activities (Baumgart 1982: 39–42; Fieldhouse 1973; Robinson and Gallagher 1961). Likewise, Abernathy (2000: 209) characterizes European expansion as “defensive aggression”: European states felt threatened when other states took territory and so responded in equal measure.
The evidence in the following text yields a different explanation: structural compe- tition. British imperialism was not the product of finance capitalism or jingoism but was rather a state strategy to contain threats—geopolitical and economic—that arose when the global structure was at its most economically competitive. This structural- competition approach thus partly builds upon the “defensive realism” thesis and Abernathy’s related theory of “defensive aggression.” But it expands them. Like these approaches, a structural-competition approach posits imperialism as a response to external threats. But unlike standard defensive realism, the structural-competition approach specifies the structural conditions under which such external threats are most likely to be felt. Abernathy (2000: 9) suggests that European states lived “in a pervasive sense of insecurity” and seized territory in direct response to other states’ “territorial advances” (209; emphasis added). Similarly, classic International Rela- tions (IR) theory suggests that threats emerge when rival states take new territory; France takes Algeria, so England takes West Africa. Baumgart (1982: 40) suggests that the threats can be “real” or “imagined,” which leaves open the question as to when states are more likely to perceive such threats. In contrast, a structural-competition approach suggests that perceptions of threat are most likely to proliferate during specific historical phases: that is, multicentric phases defined by an economically competitive global structure.
To clarify, the idea of multicentricity draws from world-systems theory that pro- poses that the global economic system oscillates between two different phases (Boswell 1995; Wallerstein 1980, 1989). One phase is the unicentric or hegemonic phase. This is when the world system has a hegemon: one state enjoys a “prepon- derance over the world economy” (Boswell 2004: 4). During this phase, there is an unequal distribution of global economic power (with one state—the hegemon— dominating the scene). By definition, the system is not competitive. The other phase is multicentricity: there is more of an economic balance across the field (and hence the former hegemons’ economic power declines relative to other states). This means that the system is at its most competitive: unlike unicentric phases, there is no single eco- nomic “winner.” Ultimately this multicentric phase can give way to a new unicentric phase as one of the contenders becomes hegemonic (Wallerstein 1984, 2002).
How does this matter for imperialism? Multicentric phases—that is, when the system was its most economically competitive—induce the most threats (economic as well as geopolitical). Imperialism results as a state strategy to manage those threats. The threats can be either real or imagined. They might take the direct form of rival powers taking territory, but they need not take such a form. States do not respond to rival powers’ territorial advances in a one-to-one fashion. Instead, multicentricity entails a pervasive sense of insecurity: a climate of threat attendant with economically competitive environments. Imperialism is the result.
But exactly why and how? Multicentric structures cause imperialism for two rea- sons. First, in multicentric periods, state rulers face enhanced pressure for expansion from capitalists. By definition, during multicentric periods, capitalists operating in or who have an interest in overseas environments face consistent economic challenges from competitors. Rival firms are poised to undercut capitalists’ market share or areas of investment. Even domestic capitalists face these threats if the growing power of rivals threatens to invade domestic markets. Therefore, in this situation, capitalists are more likely to prefer direct colonial control by their home state because such control might (a) offer security for their own operations overseas in a competitive environment and (b) prevent rival firms from taking those territories to expand their power. Accordingly, during multicentric phases, capitalists will most likely pressure the state to seize colonies for economic security and defense.
Second, the state feels more threatened during multicentric phases. Even if capitalists do try to secure their economic interests through imperialism, it cannot be assumed that the state will respond affirmatively. So why might the state be inter- ested in annexing territory? The answer is capital and containment. The first refers to revenue: states need resources to function. This means the state has an interest in imperialism that coincidentally converges with the interests of capital: states take new territory because it helps increase trade, which might help capitalists, but the new trade is taxable or might spur economic growth that in turn provides more taxable revenue (see also Abernathy 2000: 206–13; Boswell 1989). In benefiting capitalists through imperialism, state rulers can benefit themselves. The second interest, containment, refers to security. States might expand in order to protect the integrity of their own borders (including the borders of preexisting colonial territory) against threats from other states. Colonies can help protect state borders and serve as nodal points in a military defense network. Annexing territory can also help prevent the growth or threat of rival states, keeping military opponents at bay. This interest in containment even merges with the states’ interest in capital: additional colonies might help protect existing overseas trade networks and production facilities or even promote them.
The state’s interests in imperialism are heightened during multicentric phases: that is, periods of global economic competition. As increased interfirm international com- petition during multicentric periods threatens capitalists’ trade, so too does it threaten state revenue. More competition means more threats to taxable trade and economic growth. The state will thus seize new colonies to meet its own revenue imperatives while also meeting the interests of capitalist allies. Furthermore, multicentric periods enhance not just economic threats but also perceived geopolitical threats. As some states rise in economic strength, other states (including the rising or falling hegemon) will fear that the new upstarts will convert their economic strength to geopolitical and military strength. Annexation for geopolitical security becomes more likely in this situation. In short, during multicentric periods, not only do capitalists pressure the state to colonize, but also the state is most likely to succumb to those pressures out of its own interests.
All of this, however, refers to multicentric phases of the world system. What about unicentric (or hegemonic) phases? If multicentric periods increase threats to the imperatives of capital and containment and thereby lead to heightened imperial- ism, unicentric/hegemonic periods lessen them, and hence reduce imperialism. First, when the hegemonic state enjoys a relative preponderance over the world economy, interfirm competition is limited and so firms enjoy a comparative advantage. There- fore, capitalists will be less likely to pressure the state to seize more territories. Because they already enjoy relative economic success, they prefer free markets. Second, even if some capitalists do pressure the state to take colonies for mercantilist privileges, the state is less likely to respond affirmatively. Because the state faces minimal com- petition, threats to the states’ revenue sources are likewise minimized. And because other states are economically much weaker, they pose less military threats. In short, unicentric periods render the hegemonic state more secure than otherwise. This is not to say that peace prevails or that threats do not exist. But relative to other historical periods, the threats are less: in perception if not in reality. And while these threats might be met with direct military action, they are not as serious as to demand costly military intervention and costly annexation. In short, as hegemonic capitalists enjoy an economic advantage during unicentric periods, the state enjoys a comparative geopolitical advantage during unicentric periods too. Therefore, both capitalists and state managers are more likely to pursue their interests through diplomacy or treaties rather than through the coercive and costly hand of colonialism. Hegemons, exactly because they are hegemonic, prefer the status quo—nothing broken, nothing to fix (see figure 2).

Estimating British Imperialism

The relative explanatory power of the structural-competition approach can be assessed using time-series data. As noted, existing studies have not adjudicated the different explanations for British imperialism; they tend to focus upon short time periods or sin- gle cases of colonial annexation. Time-series data on acts of British colonialism over centuries can help here (e.g., Boswell 1989; Ostrom 1990; Pollins and Murran 1999).

Dependent Variable
The dependent variable is an event count: the number of territories (or “colonies”) annexed by the British state per year. This comes from Stewart’s encyclopedia (1996) of British colonies, which offers more robust data than might be typically used, such as Henige’s list (1970). Henige lists colonial governors appointed by all states. Scholars have used Henige’s data as a rough measure of the year when a new colony was annexed, corresponding with the year when the first colonial governor was appointed. But this data does not differentiate between territories that are newly acquired and territories that are renamed or reorganized. Stewart’s list, which provides a brief historical overview regarding each annexation, enables one to ascertain the year when Britain first annexed a territory and treat it as a single event. Table 1 gives descriptive statistics of the dependent variable. Figure 1 plots the variable over time.
The question is: What explains these dynamics? Existing theories have different answers that can be tested through the following independent variables.

Hobson-Lenin Thesis
According to the Hobson-Lenin thesis, British imperialism was driven by financiers seeking new outlets for investment. To capture this I enter the amount of British capital exported abroad: the net outflow of British savings into foreign assets. Economic historians offer good information for this variable in the form of the overall balance on the current account. This represents annual net foreign investment from Britain minus annual additions to bullion reserves. Economic historians typically use it to measure British overseas investment (Tiberi 2005). Using this measure, the hypothesis is that the greater the amount of foreign investment, the more colonies Britain subsequently took to protect those investments. Alternatively one might argue the reverse: the state takes colonies first, investment follows. But this is not the Hobson-Lenin thesis. In their theory, financial investment comes first and annexation follows. Both Hobson and Lenin suggest the new imperialism was driven by financiers who had already invested abroad and then pressured the state to colonize afterward (Brewer 1990: 73; Eckstein 1991: 303–5; Hobson 1902: 63). In any case, the tests correct for this also, as discussed in the following text.

Militant Nationalism
I test the Spencer-Schumpeter alternative thesis that militant nationalism drove im- perialism by using two measures. The first is the proportion of the population in the armed forces. This is a useful measure of Spencer and Schumpeter’s concept of a warlike culture or “re-barbarization.” According to Spencer and Schumpeter, one key element of re-barbarization is the spread of militaristic attitudes and practices throughout the nation. The proportion of the population in the armed forces is a good measure of this, for Spencer referred to the growth of the military as an indicator of the growth of military culture throughout British society (1902: 113). While the proportion of the population in the entire armed forces (both the army and navy) would be the ideal measure, especially considering the prominence of the British Navy, that data is only available from 1815 onward. The proportion of the population in the army is used instead because data is available for much further back in time. This should not be problematic; the available data show that army and navy membership is significantly correlated (Pearson r = .471 sig. at .001).
The other aspect of the Spencer-Schumpeter thesis is nationalism; or more precisely, “jingoism” in the popular press. To capture this, the number of articles in The London Times with the phrase “our empire” is used. The Times was the main periodical for the social groups that are identified by Spencer as the leading jingoists: educated upper classes, journalists, and statesmen. It is probably the only quantifiable source capturing the discursive consciousness of those groups. The phrase “our empire” is selected because scholars agree that the term empire during the late eighteenth and nineteenth centuries was a mark of pride and distinction. It was not primarily used to refer to Britain’s overseas colonies but to Britain’s strength and power (Koebner and Schmidt 1964: 33–46; Portner 2004). It is reasonable to suggest that the more the phrase “our empire” was uttered among the leading classes, the more jingoist they were. The hypothesis: the greater the proportion of articles using “our empire” and/or the higher the proportion of the population in the armed forces, the more colonies were taken. [END OF EXTRACT]