The 1851 Gold Discovery of Australia and Its Relationship with Global Economies
The discovery of gold in Australia in 1851 caused a disruption in the fabric of colonial Australian economies and of their relationship to other economies. Colonial Australia was building slowly from its settlement in 1788 until 1850 relying on wheat and wool as its primary export commodities. When gold was found in large quantities in New South Wales and Victoria what transpired were both a major economic shock in those colonies as well as a divergence between Australian and other economies. Current literature supports this, though in doing so only creates an overview of the changes and smooths over the effects outside of Australia. Exploring data and archives of the period reveal a story more complex than what authors of bank and other business histories have presented. This paper broadly examines the effects within the colonies of Australia while also asking how that related to other economies, particularly in Great Britain and Europe. It concentrates on the earliest few years of the gold rush, specifically investigating the export of gold as ore or bullion from Australia, how that was distributed upon arrival in England and how and why an exchange for specie was provided. The paper also examines the involvement of the financial, mercantile and governmental institutions in such transfers. The paper thus demonstrates how within a very short period colonial Australia was elevated from a settler economy to an important member of the global economy of the mid-nineteenth century.
