Abstract: Global Exports and Local Finance: The Funding of Industry in Nineteenth-Century Sheffield

Lucy Ann Newton

Abstract

Britain's economy in the nineteenth century was based on a high level of international exports of goods and services. In terms of the traditional manufacturing industries, British iron and steel production dominated the world market before 1900. A major center of this production was Sheffield, a city made up of a network of interdependent, specialist firms. By the mid-nineteenth century works in Sheffield and its environs were responsible for 90 percent of all British steel production and 50 percent of all European production. It formed a prime example of the "industrial district" as defined by Marshall. This paper will analyze the means by which five companies in and around Sheffield raised finance. The issue of finance in industrial districts is a crucial one given the high trust and high-risk environment in which businesses operated. Sheffield's business people relied on very localized sources of finance: they called on familial contacts and local banks as sources for funding, in addition to regionally traded equities. The city and its environs thus formed an industrial district specializing in manufacturing iron, steel, and metal products that were exported to the world, yet it achieved this tremendous output through enterprises whose sources of funding were regionally generated.