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Requests from the Indies. Asian Agency in the VOC’s Currency Supply to Eighteenth-Century Java

In: Journal of the Economic and Social History of the Orient
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  • 1 University of LeidenLeidenThe Netherlands
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Abstract

This paper reconstructs the chain of demand for cash from Asia to the Dutch Republic in the seventeenth and eighteenth centuries. It shows that the Javanese’s currency preferences were visible in the exports from Europe. The growing Dutch involvement in Javanese society from the 1680s increased and transformed the composition of the currencies requested from the Dutch Republic, towards more smaller denomination coins. The paper also demonstrates that with regard to the money supply, considerations of state prevailed over purely business interests. The limitations to the Dutch power forced them to adjust to the local power holders their currency preferences.

Abstract

This paper reconstructs the chain of demand for cash from Asia to the Dutch Republic in the seventeenth and eighteenth centuries. It shows that the Javanese’s currency preferences were visible in the exports from Europe. The growing Dutch involvement in Javanese society from the 1680s increased and transformed the composition of the currencies requested from the Dutch Republic, towards more smaller denomination coins. The paper also demonstrates that with regard to the money supply, considerations of state prevailed over purely business interests. The limitations to the Dutch power forced them to adjust to the local power holders their currency preferences.

1 Introduction1

The start of modern economic growth in Europe in the eighteenth century coincided with European territorial expansion. This fostered the idea that Europe’s economic rise was not only built on but also caused Asia’s underdevelopment.2 Although the synchronicity of timing of the economic divergence and beginning of colonialism remains remarkable, it is no longer understood to be the case that the Europeans ruined the Asian economies as soon as they arrived.3 Instead, various scholars have proposed to move beyond the dichotomy of Europeans versus Asians to enable a fuller understanding of Asian economic history.4 This paper examines the isle of Java, where the Dutch founded their Asian headquarters in Batavia, present-day Jakarta, in the early seventeenth century.5 Recent publications on early-modern Javanese history fit the general historiographical trend to understand interaction between Europeans and Asians not exclusively as a history of colonial exploitation. Rather than a history of Dutch overpowering the local society, they focus on shared interests between the Dutch and the local elites to explain political and economic processes.6 This historiographical downplaying of Dutch power requires a revaluation of how the Dutch impacted Java’s economic development in the seventeenth and eighteenth centuries. If, as scholars today generally agree, Dutch power was more constrained than previously assumed, then the Dutch East India Company (Verenigde Oostindische Compagnie, hereafter VOC) must have employed other or alternative strategies to achieve its political and commercial objectives. Since the VOC’s impact remains undeniable, the question thus arises: how did the VOC affect Java’s economy if its political powers remained limited?

As an alternative to force, De Vries has proposed to examine the VOC from the perspective of its trade relations, rather than as a proto-imperialistic enterprise.7 Following this approach, De Zwart has recently established that the VOC’s gross margins declined due to competition in areas and for products for which it held no monopoly rights.8 The acquisition of goods for the European market thus depended on market conditions. We also know that demand in Asia for European products remained limited and that most of the purchases had to be conducted in cash.9 For the VOC, the export of cash increased suddenly from 1680s. Moreover, these exports exceeded the increase in the value of the goods shipped back to Europe. This was, according to Gaastra, due to decreased profitability of its Asian operations. He leaves the question open whether this resulted from shrinking trade margins, expensive bureaucracy or territorial expansion.10 It is notable that this coincided with the VOC’s increasing involvement in the political affairs of Java’s main monarchy, Mataram.11 So, it may well have been the case that said involvement altered its monetary needs, because the Company’s political operations increased relative to its commercial ones. The hypothesis of this paper is that the increasing political involvement is reflected in a change in the composition of the sorts of cash requested from the VOC’s board of directors in Amsterdam.

This paper examines from a monetary perspective how the VOC’s increasing involvement in Javanese society related to local economic developments. To this end, it first provides an outline of Java’s turbulent political environment in which the VOC became increasingly involved in the eighteenth century. This overview is necessary in order to relate the growing political involvement to the changes in the composition of the various types of currency requested. The article then reconstructs how monetary needs were communicated within the VOC organization, between Asia and Europe. It then proceeds to establish a link between these demands for specific currencies and the VOC’s demands for Javanese commodities and larger economic developments and to show how the “demand chain” functioned in practice. The paper argues that the VOC responded to local populations’ specific currency preferences to purchase commodities for its trade, and this response found its way through the organisation in Asia to Amsterdam. This means that economic incentives through the market formed an important means for the company to acquire the desired products.12 Their interests were often best served when responding to local demands and preferences, implying agency by the local populace. Changes in the money supply must thus be seen as a symptom of changes in local circumstance and of the European limitations within Asia.

2 The VOC’s Involvement in Javanese Politics

Java in the seventeenth and the early eighteen centuries was ravaged by a series of wars and revolts. This period of instability ended with the Peace of Gyanti, concluded in the treaties of 1755 and 1757.13 The VOC developed from a marginal actor to a major player between the mid-seventeenth and mid-eighteenth century. The establishment of its headquarters in Batavia in 1618-19 was a violent enterprise that depended on its naval fire power.14 The south-central principality of Mataram had recently brought the majority of Java’s northeast coast under its control, and its troops besieged Batavia in 1628 and 1629.15 Only after the death of the Sultan Agung in 1646 did the VOC and Mataram establish friendlier relations.16 Some thirty years later, the VOC intervened for the first time in Mataram’s political affairs, after requests for support from the principality’s two leading rival factions.17 This intervention proved in the long run to be a watershed in Java’s history.18

The VOC’s involvement in Mataram’s internal political affairs began in 1676 when both the crown prince and the Madurese prince Trunajaya requested military assistance from the VOC.19 During the 80-year period from 1675 to 1755, Mataram was at peace for just 35 years. The historiography distinguishes the following wars and revolts: the revolt of Trunajaya (1676-1680), the revolt of Surapati (1686-1703), The First War of Javanese Succession (1703-8), The Second War of Javanese Succession (1718-1723), the Chinese revolt (1740-1745), and The Third War of Javanese Succession (1746-1755).20 Most of the seventeenth century, the VOC struggled with the neighbouring Sultanate of Banten, to its west too.21 During that century the VOC lacked the power to even protect Batavia’s immediate hinterlands, the so-called Surroundings, against attacks from Banten or Mataram.22 During the war with Banten that broke out in 1656, all ten sugar mills in Batavia’s Surroundings were destroyed. The peace treaty of 1659 with Banten and the subjugation of the sultanate in the 1680s, made the area safer.23 With each of the wars, the company’s influence grew by acquiring privileges, political say, monopolies, financial compensation for military assistance and territorial gains.24 The VOC gained influence, by tipping the balance in favour of one or the other of the warring parties—by supplying troops—not by imposing its will as a hegemonic power.25

One way for the VOC to take advantage of its increased influence in the region was to demand financial compensation for military services. The VOC tried to recover at least part of its expenses by transferring debts to the belligerent parties. For instance, after the First Javanese War of Succession, the victorious new monarch, or susuhunan, Pakabuwana I agreed to pay the VOC substantial instalments in cash, although in the end he paid just two-thirds of his debt.26 Pakabuwana promised to pay up increased Mataram’s need for ready cash. This probably reinforced the process of increasing monetisation of taxation, and corresponding decline of statutory labour, that was already underway.27 The Mataram state’s acceptance of dubbeltjes—a Dutch currency also known as double stivers—as tax payment, from 1703, spurred the the usage of these coins in Java.28 Hence, even before the VOC taxed Java’s inland directly, tax revenues flowed through Mataram’s state coffers to the Company, in Dutch currency.

The VOC’s income from taxes increased from the seventeenth into eighteenth century in both relative and absolute terms. De Vries’ observed a jump in taxes during 1760s from 28% to 45% of the VOC’s total income.29 These figures are less straightforward than De Vries suggests. First, as can be seen from Table 1, the strong increase in the share of the tax revenue in the total income was due to a fall in the proportion of revenue accruing from trade, not as a result of an increase in tax revenue. Second, changes in 1743 and 1768 in the VOC’s already complex bookkeeping method may have caused miscalculations; to correct for a different valuation of silver in Asia, the Company in Asia increased the value of currency received from Europe by 25%. The value in Europe was described as ‘heavy’, the Asian value as ‘light’.30 It is notable that a jump in total income can be observed in the period 1743-1768, when the accounts were kept in ‘heavy’ European money, in contrast to the period when it was kept in ‘light’ Asian money. When expressed in the same currency, as is done in Table 1, the VOC’s income from taxes can be seen to have increased swiftly from the 1680s onwards and stabilised from around the 1740s.

Table 1
Table 1

Composition of VOC revenue in Asia, 1640-1790 (in ducatoons of 66 stivers)

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

Source: De Korte, Financiële verantwoording, pp. 31, 39-40, 47, 49

The VOC’s power must not be overestimated. In spite of its ambition to achieve peace and tranquillity –war being bad for business—hostilities remained entrenched until 1755. Warfare yielded negative effects in lives lost, trade decline, forgone harvests and the destruction of industrial assets such as sugar mills.31 Arguably, the most telling example of the VOC’s limited powers is the Company’s inability to end the Third Javanese War of Succession. Right before his death in 1749, Mataram’s monarch Pakubuwana II transferred his sovereignty to the VOC. The war nevertheless dragged on, because the VOC failed to defeat the rebels. Instead of reuniting the empire under Pakubuwana III, the Company had to allow Mataram’s tri-partition in 1755 and 1757 among three rulers. Soon, the division of power proved more effective and less costly than the hitherto pursued policy of military intervention in support of a single pretender to the throne.32 Meanwhile, peace brought demographic and economic growth.33 However, as late as 1780 the VOC still depended on Javanese military assistance to maintain its defences against the British, as part of the Fourth Anglo-Dutch War (1780-1784).34 Hence, internal turmoil allowed the VOC to increase its political control over Java, of which the VOC officials took advantage as soon as they saw the opportunity to do so.35 This changing role of the VOC, from trader to territorial ruler, is reflected in the composition of its income.

Others have already linked the VOC’s supply of currency in Java to its increasing political involvement. Nagtegaal linked this to the introduction of dubbeltjes in the 1680s and the acceptance of the currency as tax payment from 1703. Kwee argued that the presence of duiten enabled monetised taxation from the 1760s onwards.36 In the period between 1720 and 1760, duiten had become the standard means of payment and consequently the most easily obtained money through taxation. Whereas the success of the dubbeltjes was related to the interaction between the state of Mataram and the VOC, the success of the duiten depended on the acceptance by and preference of the ordinary Javanese as will be discussed in section 4.

3 Demand and Supply within the VOC

Since the VOC was politically far from omnipotent, it had to adjust to local circumstances. This also holds for its economic position in Java. It could not set prices and determine quantities of goods as it did in the Moluccas and Ceylon.37 In Java the Company had to consider market circumstances, including supply and demand. If the Company deemed it necessary, it turned to coercion to obtain the desired goods on its own terms. Yet it could not do so everywhere or all the time; Java’s northeast coast was simply too large for the VOC to exercise continuous control over the commodity flows. The company employed only a few thousand Company servants in Java, against a total of about 5 million Javanese.38 Even if the VOC had considered exercising permanent control, this would have been an extremely costly option. Adapting to the market was both cheaper and easier. The adaptation to the market implied that the VOC had to pay in currencies that the local counterparties accepted. This section analyses how the Company responded to monetary demands and currency preferences, by examining the correspondence about monetary requirements within the VOC organisation between Amsterdam and Batavia.

My hypothesis is that the VOC adapted its shipments of money to local currency preferences. The correspondence within the VOC organisation provides us with clues to test this hypothesis with with regard to practices in eighteenth-century Java. This section first provides an overview of the exports from the Dutch Republic to Asia over the entire period of the VOC’s existence. It proceeds then to examine how the VOC administration in Batavia—the High Government—formulated its requests to the board of directors in Amsterdam, the ‘Gentlemen XVII’.39 It then describes how local demand for specific currencies informed the drafting of the requests in Batavia. Finally, it discusses how the board in Amsterdam responded. Establishing a clear link between demand and supply is important because the figures about the actual exports are well preserved, while our information about the requested monetary supply is obscure.40 Hence, understanding how the board in Amsterdam assessed the demands from Asia improves our understanding of the representativeness of the supply for gauging Asian demand.

3.1 The Exports to India

Figure 1 represents the total shipments of money exported from the Dutch Republic to Asia, throughout the VOC’s existence. The figure shows a significant change around 1680. Until then, the value of the exported money and bullion hovered around 10 million guilders per decade. Thereafter, this amount increased, up to 60 million guilders in the 1720s. Although this latter figure was an outlier, and the value of shipments thereafter declined, it nevertheless remained substantially higher than than anything seen in the 17th century, at between 40 and 50 million guilders per annum. The increase in money shipped from the Dutch Republic to Asia coincided with what we have seen above was the company’s increased involvement in Javanese political affairs.

In Figure 1, I distinguish between bullion and large currency, on the one hand, and small change, on the other.41 Until the 1640s, the VOC shipped no small currency to Asia at all. As noted above, the demand for dubbeltjes increased from the 1680s. This increase was indicative of a larger change: during the same period, exports of bullion and small-denomination coinage increased also. From the 1680s to 1720s exports of small currency also increased as a percentage of total exports. The amounts in this period equalled those of the total exports in the period up until then. The increased of smaller currencies is relevant because the money and bullion served different purposes; bullion and large silver and gold coins sufficed to purchase goods for the Company’s wholesale trade, whereas the import of small silver coins and copper coins facilitated everyday transactions.42 Hence, the composition of the exports changed from the 1680s, with more money suitable for small daily transactions.

Figure 1
Figure 1

Money shipment from the Dutch Republic to Asia, 1602-1795

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

Source: Bruijn, Gaastra, and Schöffer, DAS, I: Introductory Volume: PP. 223-269

3.2 Requests from the Indies

One source that may help us answer this question is the Eisch van Indië (Requests from the Indies). These were lists in which the High Government annually formulated the expected need for supplies, troops, money and bullion in the two years to come. The two-year time lag in the forecast was the result of the long journey—eight to nine months—from Batavia to Amsterdam and back. The issues of the Eisch van Indië are generally understood to be lost.43 But at least two of them have survived, for the years 1779 and 1781. These documents allow for a comparison between the requested amounts of currencies and the money and bullion actually exported from the Dutch Republic, to gain some insight allowing us to establish the extent to which the High Government’s requests were met.

The first observation we can make is that the VOC in the Dutch Republic complied at least with all requested denominations, none exempted. The striking point to note is that the total sum exported was more than twice the requested amount. Almost all types of bullion and coins were in quantities larger than requested, though not in equal proportions. While gold ducats and duiten were shipped in the requested quantities, 200,000 guilders’ worth of half ducatoons were also shipped, despite none having been requested at all. Gold and silver bars and Reals contributed the most to the excess of the export value in absolute terms, which together amounted to almost 3.6 million more than requested. In relative worth between requested and shipped amount the ducatoons stand out; eight times as much as requested was sent over. On top of that were 200,000 guilders’ worth in half ducatoons that had not been requested at all. The Gentlemen XVII thus sent more than met Batavia’s High Government’s request, mostly in the higher denominations.

Similar observations can be made about money exported in response to the request from 1781. Again the total value of the exports exceeded the requested sum, although not to the same extent as in 1779. Excesses are again to be found in the categories of gold bars and Reals. All other types of coins and bullion were exported exactly according to the request. The ‘Gentlemen XVII’ in Amsterdam thus complied completely with all requested sums from Asia.

In both instances the VOC in the Republic sent more money to Asia than was requested by the High Government in Batavia. Particularly gold and silver bars and large silver coins contributed to this excess. Smaller silver coins and copper duiten were sent over, according to the request, but not in excess. In both instances, the VOC in the Republic at least complied with the requested amounts for all individual denominations. This level of similarity suggests that the Gentlemen XVII took the Requests seriously and acted accordingly.

Besides these two surviving Requests from the Indies, there is a third source that supports the interpretataion that the VOC accurately responded to the Requests from the Indies. In an internal memo from 1785 the Company’s cashier Temmick discussed the price, production and production costs of duiten by the provincial mint masters. He wrote the memo because he suspected that the mint masters earned a considerable margin from the minting of the duiten for the VOC. Lowering the margin would be possible, he wrote, but this should not come at the expense of the quality or copper content. He indicated that the coins circulated among the “small communities” in Java and Ceylon. Offering poor-quality duiten would reduce the demand for this currency among the Javanese and Ceylonese populations: this would disadvantage the VOC, which earned a considerable margin on the issue of the coins.44 So, he suggested that the demand for the duiten from the ordinary Javanese and Ceylonese would drop as soon as the quality of the currency deteriorated.

Table 4 shows that, except for in 1775, the provincial mints produced coins in the approximate quantities requested. Later in the text Temminck mentioned that for three years no duiten had been requested, whereas the table only indicated this for the years 1773 and 1774. This suggests that also in 1775 a lack of demand explains the absence of exported duiten.45 Concerning 1779, the figures from Table 2 and Table 4 consistently report the requested sum and actual export of 100,000 guilders’ worth of duiten. With the exception of 1777 and 1778, the mint masters produced coinage in the eaxact quantities requested by Batavia’s High Government. This source confirms that at least in the case of duiten coins were produced according to the Requests of the Indies.

Table 2
Table 2

Requested and exported money and bullion over 1779

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

Source: National Archive, The Hague (NA), VOC archives (VOC), Inv.nr. 3471, f. 169, Bruijn, Gaastra, en Schöffer, DAS, I: Introductory Volume: 223-246
Table 3
Table 3

Requested and Exported money and bullion over 1781.

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

Source: NA, VOC, Inv.nr. 3530, f. 163-164, Bruijn, Gaastra, en Schöffer, DAS, I: Introductory volume:223-246.
Table 4
Table 4

Requested, produced and exported duiten, 1771-1780.

The company sent duiten to East India over the following years:

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

Source: NA, VOC, INV.NR. 4717, p. 2.46

Together, this memo and the two Requests from the Indies are merely three observations in a limited time period. This raises the question how representative this period was and how the High Government drew up the requests in all other years. In the next section of the paper, we will address this question by analysing other internal correspondence of the VOC in Java.

3.2.1 Drawing up the Request in Batavia

The simultaneous shipment of money to pay for the Company’s trade, and smaller denominations to smooth local payments reflects the VOC’s dual role as merchant company and sovereign. At its creation, in 1602, the VOC obtained sovereign powers, including the right to hire soldiers, wage war and conclude treaties as part of its charter as monopolistic company for the trade with Asia.47 This corporate dualism formed a source of contention because military actions and expanding administrative control put pressure on profits;48 for instance, despite the directors’ objections to territorial expansion, the territories under direct control of the Company steadily increased in Java.49 The distance in time and miles limited the control of the Amsterdam board over Asian affairs. This fostered an independent course by VOC servants in Asia, related to local circumstances.50

With the VOC’s territorial expansion, the administrative duties towards the subjects under its control increased as well. Among these the responsibilities was the need to maintain a sound money supply and an orderly circulation.51 The VOC servants considered the local tin-lead pici-coins unsound, because their inferior quality caused an extremely high wear rate.52 Even before the introduction of the Dutch copper duiten in the 1720s, the VOC had attempted to supply sufficient durable coins to Java. In the early eighteenth century, the local VOC officials specifically stated that they purposely imported copper coins from Japan because this money was used at Batavia’s local market.53 The Company could not just issue coins at its own discretion; it had to consider the local needs. For instance in 1711, the Company’s officials in Batavia wrote to the Gentlemen XVII that there was no need for copper duiten, because a sufficient number of local copper coins circulated.54 This changed a decade later, when the first duiten were sent to Java with the explicitly stated intention of increasing the convenience of people’s daily purchases on the market.55 Thus, the Requests from the Indies expressed local currency preferences.

Indeed, in their requests to Amsterdam, the VOC officials in Asia often referred to the local situation to substantiate their requests. An accompanying letter concerning the 1731 request states that VOC officials were hamstrung by a lack of gold and silver bars: in East Java they had to rely on ducats, rupias and Japanese kobans, whereas the VOC bought gold from the Chinese, which they paid for with fractional coins. Yet they immediately requested fractional coins for East Java and Batavia, because it was impossible to obtain them locally. Even more intriguing is that the Javanese converted ducats into smaller coins, which shows a certain preference for fractional coins. VOC officials argued that although ducats were more profitable than fractional coins, the Javanese preference was the only reason to request shillings and dubbeltjes—also known as double stivers—from Amsterdam.56 This Javanese preference was reflected in the request to the Republic; the demand for 100,000 guilders’ worth of duiten was supported by the argument that the total sum and the request for silver fractional coins [Dutch: payement] could now be decreased.57 By 1739 the demand for payement in Java had risen again, this time to the level that it was possible to exchange these coins only at a 10 percent premium.58 Hence, local needs to uphold a sound money supply translated into the VOC’s request for certain types of currency, sometimes at the expense of more profitable currencies.

The VOC did not merely observe the local situation passively, but tried to promote use by the Javanese of of Dutch coins, for instance the new duiten-coins during the early 1730s. Yet the local princes sought to protect their own income derived from the issuance of the tin-lead pici-coins.59 Hence, the VOC faced competition in the issuance of currencies. The VOC had an important incentive to promote the use of its own copper currency, because the exchange rate was highly favourable compared to silver in Europe.60 Consequently, the sale of the copper coins was a potentially lucrative business for the VOC.

The VOC’s intrusive promotion seems to have been successful, because in 1732 the initial request for duiten was doubled from 50,000 guilders to 100,000 guilders’ worth, due to the scarcity of small change in East Java.61 Some twenty years later, it was still hard for the Company’s employees to have the VOC coins accepted within the local economies. The Batavia administrators urged the local VOC officials in 1752 to promote the use of the Dutch coins with more effort.62 By 1755, the silver Spanish Reals were a still generally accepted means of exchange in Java’s interior. The VOC’s officials wished to change that so that the Javanese should “unnoticed and gently” be deterred in favour of the Dutch coins.63 The eventual popularity of the VOC’s smaller coins can also be illustrated from the repeated bans of counterfeiting later in the period.64 The VOC could not simply issue the duiten, but had to deal with local competition and willingness to get the VOC coins accepted, at which it seems to have been rather successful.

This success was far from preordained, as we can see from what happened in the Maluku island of Ternate. There the introduction of the halve duiten coins in 1756 failed, and the local VOC officials requested dubbeltjes, shillings and whole duiten from Batavia instead.65 This serves to highlight not only the VOC’s dependence on local acceptance, but also demonstrates that Batavia’s requests to Amsterdam were based on the subordinate trading posts’ requests that reflected the demand elsewhere in Asia.

That the demand from the subordinate trading posts formed the basis of the total Request from the Indies can, for instance, been seen in a letter to the board in Amsterdam in 1741. There the High Government stated that the money received from Europe was barely sufficient to cover the trading posts’ requests.66 This layered practice made projections for the required money supply difficult, since not only the time between Europe and Asia had to be taken into account, but also between Batavia and its subordinate trading posts. The High Government in Batavia found itself in a delicate balancing act to supply sufficient money to the subordinate trading posts in Asia, each depending on different local currency preferences, whereas the total supply from Europe was hardly sufficient.

Requests like the one from Ternate, became more detailed after 1750, when a detailed new entry info force. This required the trading posts to provide the following in a separate memorandum, in addition to their requirement of money: (1) a statement of the amounts remaining at the each trading post and their dependencies; (2) the received annual supply of merchandise and provisions; (3) the annual profits and income, by estimate; (4) the debts; (5) the annual expenses, by estimate; (6) the returned goods over the previous year and the current stock; (7) what is needed, in balance.67 The purpose of this 1750 instruction was to improve the assessment of what each of the trading posts needed.

3.2.2 The Pivotal Role of the Grand Money Chamber

Central to the management of these requests was the Grote Geldkamer [Grand Money Chamber] in Batavia, which physically stored the VOC’s money in Asia.68 The money stock fluctuated due to receipts from the Dutch Republic, re-exports to subordinate trading posts, local issues of currency, wholesale purchases and bills of exchange to be drawn in the Dutch Republic. Personnel and private persons who wanted to transfer money from Batavia to Amsterdam could purchase a bill of exchange. The cash paid for this bill of exchange was handed over to the Money Chamber, so that the money remained in Batavia. Upon return to the Dutch Republic, the bill could be converted back into cash.69 How important this category of income was to the VOC in Asia becomes clear from a refusal of inhabitants to sign bills of exchange in 1739, which worsened the Company’s shortage of cash immediately.70

An inverse situation occurred in 1748, when the High Government announced it would refuse bills of exchange drawn in Europe, in order to allow the VOC in Amsterdam to ship more money to Asia.71 At first sight, this seems an odd policy, since the acceptance of coins in Asia would have resulted in money readily available. But the argument with which the High Government defended its decision is telling: it wished to increase the volume of the circulation in Asia by increasing imports from Europe. So the increase in the total money supply gained precedence over the immediate collection of cash for the High Government.

In order to accurately draw up the request from the Republic, Asian VOC officials constantly tried to forecast and balance their future incomes and expenditures. In 1741, 7 million guilders’ worth was received from Europe, which sufficed to pay the demanded 4.7 million guilders from the subordinate trading posts and interest over deposits of 300,000 guilders. The net receipt thus amounted to approximately 2 million guilders, resulting in a total money stock of 3.8 million guilders. This means that the Money Chambers’ stock amounted to 1.8 million guilders’ worth just before the ships from Europe arrived.72 The High Government furthermore stated that if the previous request was not fully paid, the shortfall had to be added to the next request.73 Hence, the Batavian VOC officials adjusted their monetary requests based on the level of past compliance by the Dutch VOC officials with previous requests.

If the amounts of money received proved less than requested, the High Government simply increased the next request to the value of the previous shortfall. It employed this strategy, for instance, in 1745, when it increased the requested sum from 3 million to 3.6 million, because the Amsterdam board had written that they would only supply 2.4 million of the requested 3 million over 1743. Moreover, the High Government deemed the money stock of 3.2 million in 1745 too small to cover the expenses for the Company’s purchases.74 As shown from the Money Chamber’s account, the Asian Company officials had every reason to ask for more money, if only to cover the deficits incurred through Money Chamber. Shortages of cash in Batavia caused problems for trade elsewhere in Asia; pepper in Banten, Palembang and Borneo was purchased on credit and the Bengal office had to borrow locally. Therefore, the High Government urged the Gentlemen XVII to fulfil the demands, including those from previous years amounting to 14 million guilders.75

If the local demand for money decreased, the request from the Dutch Republic was reduced as well. The request in 1743 was, for instance, decreased from 5.2 million to 3 million guilders and that for 1757 from 5.8 million to 5.2 million guilders.76 By 1758 there was an oversupply of the fractional duiten coins in Java’s economy. With reference to further unspecified inconvenience to Java’s inhabitants—presumably inflation—the High Government decided to halt the issuance of duiten from the Company’s office in June 1757, and no duiten were sent over from the Republic.77 The measure had not produced the desired effect by the next April, since the duiten still exchanged at a 15 per cent discount. The company, therefore, decided to repurchase duiten at a 10 per cent discount.78 The VOC subsequently incurred a loss compared to the nominal value, albeit not as large when compared to market exchange price. From a purely business perspective, it made little sense to incur a loss to diminish the oversupply of fractional coins in circulation.

A few years later, in 1763, the demand for smaller fractional coins had increased again in the Semarang hinterlands. The High Government was happy to see that the money stock in duiten and shillings had decreased, because of transfers to Java’s northeast coast. The issuance of shillings, in particular, was an unexpected success. The susuhunan of Mataram even requested more of this currency. The High Government sent 95,000 guilders’ worth of shillings in response. The decline of fractional coins in stock, however, made the Batavian officials worry that they would possess insufficient quantities to send to the subordinate trading posts. Therefore, they requested more payement from the Dutch Republic. Meanwhile, they stipulated that Batavian bakers pay for wheat in duiten,79 which would then raise the stock of duiten again. So, the High Government sometimes limited the request for money—both in total and for specific currencies—and pursued an active policy to manage the local money supply.

There is yet another reason to believe the Asian section of the VOC responded sensitively to the local currency requirements, through the Requests of the Indies. In 1743 the VOC had acquired mintage rights from the sushunan, which they could have used to solve temporary deficits for certain coins types. Yet only in a limited number of years did the VOC mint coins locally, and only when European wars hindered regular imports. The first period coincided with the War of the Austrian Succession (1740-1748), the second with the Seven Years’ War (1756-1763), the third with the Fourth Anglo-Dutch War (1780-1784) and fourth with the period following the Batavian Revolution of 1795. In total, less than 400,000 guilders’ worth was minted between 1743 and 1808.80 This is a negligible amount compared to the annual average of 4.7 million guilders’ worth of monetary exports from the Netherlands in the eighteenth century. Local mintage was only a rarely used emergency measure, whereas the Requests of the Indies reflected the need for means of exchange to which the VOC in the Netherlands generally responded adequately and dynamically.81

3.2.3 Checking the Requests in Amsterdam

Formulating a request based upon local demands in Batavia is only the first step in the process to assess whether the VOC adapted its shipments of money to local currency preferences. The next issue is how the VOC in Amsterdam responded to the requests. Did they accept their Asian counterparts’ judgements? We already saw that the Asian VOC officials would request more money the next time, if the response did not meet their demand and insufficient funds were sent over. A deviation from the requested amounts may imply a conflicting perception of much money Batavia needed, by the VOC in Amsterdam.

The Gentlemen XVII in Amsterdam used a simple yet cunning strategy to evaluate whether the ‘Request from the Indies’ was justified. It compared the requests received from the High Government with the alterations of the money stock held at the Grand Money Chamber in Batavia.82 In 1730 the Gentlemen XVII had imposed a regulation that a statement be prepared once a year and, a year later, that a monthly statement of the funds remaining be included in the resolutions of the High Government.83 This method allowed them to monitor the actual use of the money in Asia and provided them with a device to check the actions from the High Government in Batavia.

It is clear that the Gentlemen XVII depended on statements from Batavia, making this process vulnerable to manipulation by the High Government. On the other hand, inconsistent reporting could raise the Gentlemen XVII’s suspicion, as happened in 1757: the debt reported in the request amounted to 2.3 million guilders, whereas a memo attached to the same request indicated the amount of 1.5 million guilders. The Gentlemen XVII voiced their displeasure about the inaccuracy and demanded that the money sent over was to be used exclusively to redeem the debt.84

Such suspicions seem to have led to another attempt to increase control by the Amsterdam board. In 1763, the Gentlemen XVII noted that it had not received a statement of the funds remaining in the Ternate trading post over 1759/1760. The fact that the Gentlemen XVII evidently expected such a statement implies that some offices were to send these overviews directly to the Dutch Republic—presumably the larger trading posts—and others to send a trifold statement to Batavia, which would then forward it.85 In this way the Gentlemen XVII bypassed Batavia and enforced consistency in the bookkeeping.

There seems to have been a correlation between the requested sums of money and bullion and the amount and denominations actually sent over from the Dutch Republic, but the correlation was not a simple one. Examination of the two aforementioned requests from 1779 and 1781 (cf. Tables 2 and 3 above) suggests that—at least by the later eighteenth century—the compliance was high and exceeded the request for certain types of money. The analysis of the Company’s correspondence shows that a number of sources for money played a part in drawing up the request, from the evaluation in the Dutch Republic, to borrowing in Asia and restricting the use of bills of exchange.

It is nevertheless clear that the Company was forced to comply with the demands of the market and was far from imposing its policy directly on Java’s economy. This is most obvious from the greater reluctance to acceptance of the duiten than dubbeltjes. The absence of duiten imports in some years was thus caused by a lack of demand, to which the VOC in Asia responded accurately. By repurchasing the duiten coins at an unfavourable rate in the 1750s, the VOC gave priority to its role as a sovereign, rather than acting as a profit seeking enterprise. Likewise, the Company in Asia gave precedence to an orderly money circulation by requesting fractional coins instead of the more profitable ducats. In both instances, the Companny prioritised the maintenance of a sound money supply for its subjects over profits.

Figure 2
Figure 2
Diagram of the VOC’s information and currency flows

Citation: Journal of the Economic and Social History of the Orient 63, 5-6 (2020) ; 10.1163/15685209-12341525

4 Currency Preferences and Commodity Production

A sound money supply was clearly not the main reason for the Asian branch of the VOC to request specific currencies: such requests in fact related to specific transactions in the Company’s trading activities. For instance, the local office in Banten needed Reals to pay for the Company’s pepper purchases. This reflected the preference not of the sultan himself, but rather of his subjects in the Lampong region—in Sumatra, which was also under the sultan’s control—where the alternative ducatoon coins were not accepted. The local officials expressed their concern about the lack of Reals, and warned that if the Gentlemen XVII in Amsterdam did not send this currency, the pepper could not be purchased.86 So, even if the VOC did not deal directly with local producers, their currency preferences translated into the demands made to the Amsterdam directors through the local elites.

In the first part of the seventeenth century, the High Government wished to stay away from petty trade in the local market.87 By the end of the century, they had nevertheless become involved with the local markets. The VOC-related sectors of Java’s economy grew, including the demand for rice and timber for local use.88 The increased demand for export products stimulated the local economy, causing a higher number of transactions, which increased the need for good-quality coins.89 Such payments were not necessarily conducted in large coins normally used in wholesale trade, and small-denomination coins were sometimes used instead.90 A nice glance into the relation between currency and export products on Java comes from a description of a transport from the Cirebon coast; in late 1732 the local resident requested small change, ducatoons and rupias from Batavia in exchange for rice, coffee and timber.91 The relationship between these specifically requested currencies and these three commodities is illustrative for the VOC’s functioning in eighteenth-century Java, as will be detailed below.

Batavia depended heavily on the import of rice from Java’s northeast coast. Its immediate hinterlands produced too little to provide for its inhabitants. The Company’s involvement in Mataram’s political affairs cannot be separated from this dependence.92 Local elites played an intermediate role in connecting the VOC to the ordinary Javanese rice producers, as we can see in a statement of members of Madura’s ruling elite. They declared in 1739 that under the VOC’s protection they enjoyed peace, and were well remunerated for the products they delivered to the Company.93 The demand for commodities was determined not just by the Company’s own consumer needs, but also by the sales prices elsewhere around the globe, as in the case of the cash crops coffee and sugar. This section aims to demonstrate that the VOC in the various cases responded to specific local currency preferences to acquire the desired commodities.

My line of argument here contrasts with Els Jacobs’ view that even though the VOC’s monopolies were not watertight, their policies damaged overall economic development in Java.94 Monopolies are disruptive for free-market operations. The question is whether the VOC’s operations actually damaged Java’s local economy. Moreover, keeping an eye on the public interest, as happened with regard to the money supply, would contradict such a strong claim as made by Jacobs. To determine what policy the VOC pursued and what the effects were, the current section scrutinises the Company’s economic behaviour on Java, looking at to what extent monopolies existed and functioned for the acquisition of the desired commodities.

The monopolies exploited by the VOC form an outstanding example of the dualistic character of the organisation; political power and economic interest were entirely interwoven. The Company’s monopolistic system was, however, a bit more complex than the term suggests at first sight. Historiography distinguishes three types of monopoly in the VOC’s operations: (1) trade between Asia and the Ducht Republic, (2) Dutch trade between VOC trading posts within Asia and (3) on certain commodities, either due to territorial control by the Company itself or exclusive agreements with Asian rulers. In Java, only the third type of monopoly existed, in both manifestations.95

This section concentrates on the monopolistic trade in two commodities, rice and coffee. For rice, the direct interaction with local producers increased during the eighteenth century, although the deliveries through the Javanese elites remained in place. Coffee was a different case, as it was not ‘native’ to Java, but was introduced by the VOC. At first, the coffee plants were handed out to the local elites. Consequently, the demands of the local population showed indirectly at first, through local intermediaries such as the coastal gentry and Chinese traders.96 Over the course of the eighteenth century, the Company became more directly involved in the production by local planters and thus had increasingly to respond to demands made by Javanese population directly.

4.1 Rice

Rice had long been Java’s major export product, at least since the sixteenth century, but probably since much earlier.97 When the Dutch arrived at the end of the sixteenth century, they discovered that rice could be purchased only with pici-coins.98 Direct purchase from rice producers was difficult, since the Javanese state held a monopoly exercised by the local gentry, who acted as intermediaries between the Company and the peasants.99 This indirect nature of the trade might obscure the eventual means of payment received and demanded by the Javanese.

Indirectly, however, the locals’ currency preferences may be inferred. There are, for instance, indications that the Dutch silver dubbeltjes were increasingly used for purchases of rice from the local Javanese gentry, by the turn of the eighteenth century. The preference for dubbeltjes was a relatively recent phenomenon that had only gradually evolved after 1677, when the VOC decided to use these coins to pay for its purchases.100 In 1724, VOC ships bound for the Moluccas could not ship all the rice from Tegal on Java’s northeast coast, because the VOC lacked sufficient quantities of dubbeltjes, which the Javanese demanded as means of payment.101 A short supply of rice for exports around Semarang, in 1729, could be resolved only by a Chinese middleman, who advanced a great sum in cash, provided that it was paid in dubbeltjes.102 An adjustment in the exchange rate for fractional coins led to the refusal of dubbeltjes as payment in 1736. The Batavian government did not understand the sushunan’s opposition, as the VOC would accept the fractional coins at the same rate as it issued them. Nevertheless, it would pay Reals to those who preferred them over the dubbeltjes. In anticipation, the VOC had sent 15,000 Reals to the Javanese officials in Semarang.103 In 1742, a lack of dubbeltjes in Semarang increased the rice price. The VOC offered a payment in duiten instead, which was accompanied with the promise to exchange them for dubbeltjes once an adequate supply was restored.104 By 1754, the VOC provided an advance for the rice harvest in dubbeltjes to Javanese northeast coast gentry. The Company stipulated that this advance was to be paid to the local peasants. At the same time the VOC officials along Java’s northeast coast urgently bade the Batavia office to fulfil their submitted request (eisch) for dubbeltjes to pay for future rice purchases.105

Whether the VOC could obtain sufficient quantities of rice depended of course not only on the availability of dubbeltjes, but also on production. After the Peace of Gyanti was concluded in 1755, the war-stricken rice cultivation got the attention of the High Government. The goal was to quickly restore rice production. This was hampered due to the lack of buffalos and other necessities for rice cultivation. In order to restore production, the VOC used a monetary incentive. It doubled the purchase price from 24 guilders per koyang to 48 guilders.106 No reductions of this price were allowed. Anyone who had not received the full payment, or was forced to give a rebate to someone else, was allowed to file a complaint in Semarang. If these complaints were justified, justice would be done in such a manner that it would “scare off [others] from harming commoners”.107 This threat to punish anyone reducing the higher price was clearly aimed at the local elites and potentially corrupt VOC servants; the High Government wanted to make sure the impoverished peasants benefitted.

Similarly, De Zwart and Van Zanden demonstrate that the VOC often lost money on the sale of rice in Batavia.108 They explain this phenomenon by arguing that the Company was more interested in feeding its employees than making a profit from rice. Their finding chimes with the public condemnation of the private sale of rice in Batavia in 1714 at market prices, instead of the lower official prices set by the High Government. They did not tolerate this form of ‘usury’ at the expense of the poorer part of the population.109 The VOC thus protected the weaker, including Javanese rice peasants, employees or poorer citizens in Batavia, by offering generous prices and shielding them from large fluctuations of rice prices.110

Rice prices became less volatile and tended to decrease after the lasting peace of 1755 was concluded.111 Nagtegaal and, De Zwart and Van Zanden suggest that the Company’s increasing economic involvement may have caused more efficient use of land and labour, and living standards may have improved between 1740 and 1790.112 This is consistent with the observations of a contemporary, who noticed an increase in cultivated rice lands, which suggests that the VOC’s purpose to stimulate rice production succeeded.113 The absence of inflation in the second half of the eighteenth century further suggests that increased monetisation may have stimulated rice production.114

The Company was nevertheless far from controlling the rice market. It remained dependent on market operations to acquire sufficient quantities of rice. An inadequate supply of duiten during the late eighteenth century complicated rice purchases, because the local people now preferred these coins as means of payment. Consequently, the Company’s rice purchasers first had to acquire the duiten at a premium—for the scarcity of duiten increased their exchange rate—and then purchase the rice relatively dear.115 This shows the limited control of the Company over the rice market vis-á-vis the bargaining power of the local rice producers, who strikingly did not simply demanded a higher price but, instead, required use of the duit as a chosen means of exchange.

Meanwhile, it was not only the production of rice that increased during the second half of the eighteenth century, but also its consumption. This was the case in the coastal area as well as in the Mataram principalities. The common man increasingly ate rice instead of root crops, which is seen as an indication of increased prosperity that resulted from the lasting peace after 1755.116

4.2 Coffee

Coffee was the other agrarian commodity that received noticeable attention from the VOC in the early eighteenth century. European demand, production in other parts of the world and local relations all played a part in the development of coffe production in Java—a process which can be divided into three periods.

The first period began with a boost in coffee consumption in Europe in the 1690s. Until then Yemen had been the only commercial coffee producer in the world. Difficulties with the purchase of coffee there incited the VOC to experiment with coffee cultivation in Java.117 Although the Company handed out the first coffee trees to the Javanese gentry in 1707, coffee production really boomed after Priangan’s118 peasantry also began to cultivate this not so labour-intensive side-crop on their own plots as well.119 Within two decades Java’s coffee production surpassed Yemen’s, thereby giving the VOC control over 50% to 75% of the global coffee production.120 To fully benefit from the success, the VOC announced a monopoly on the export of coffee, in 1723.121 By offering high and fixed prices, the VOC persuaded the Javanese to cultivate coffee and shielded them from price fluctuations on the world market. The price mechanism to encourage coffee production worked so well that it resulted in shortages of labourers and cash.122

The first of these problems was solved by migrant labour,123 the second by offering different means of payments. The VOC proposed in 1723 to pay a quarter of the purchasing price in cloth. It stipulated that the cloth was to be of sorts “as desired by the coffee planters.”124 A smuggling prohibition a decade later implies that the cloth must have been in high demand in Java and that illegal imports harmed the Company’s interests.125 By making a profit on the cloth, the Company aimed to save cash the VOC offered cloth as commodity money and thus make the coffee purchase more bearable.126

The second period began when the VOC in Amsterdam and Batavia began to fear overproduction, in the late 1720s; it tried to limit production and reduced the purchasing prices dramatically.127 Caribbean coffee flooded the European market from the 1730s, causing a downwards price movement.128 The Company now restricted coffee cultivation to areas closest to Batavia, in Cirebon and Priangan. To this end it entered into an agreement with the susuhunan of Mataram in 1733, to destroy all coffee trees in his realm.129 Five years later, in 1738, the Company decreed the destruction of coffee plants in Cirebon and Priangan as well. At the same time, it stipulated that payments would henceforth be transacted half in cash and half in 4.5%-bonds, due to a lack of money.130 The currency that the Company sought to save for this purpose was presumably the duiten. In 1733, the VOC had supplied the local elites with this currency for the specific purpose of purchasing coffee and other commodities from the Priangan region.131 The policy of discouragement caused migrant labourers to return home.132 Priangan peasants, however, continued to cultivate coffee.133 Java’s total coffee production nevertheless dropped.134

The payment in the form of bonds especially struck the smallest peasant cultivators in the Cirebon region, as Company servants noticed a year after introducing the practice, in 1739. The High Government deemed this means of payment unfit for this group. Therefore, it reversed the 1738 decision by paying for coffee purchases entirely in cash again. At the same time, it sought to incentivise diversification of production, by promising a 100-rixdollar bonus for the first one to harvest 1,000 pikols of pepper instead.135 By the end of 1739, all bonds to the coffee producers had been reimbursed.136 So, the VOC clearly adjusted the means of payments to the intended users, in this case the small coffee cultivators, despite being constrained by inadequate supplies of cash.

During the third phase, from the 1760s onwards, the VOC relaxed the conditions under which coffee had to be delivered. This restored the production to 1720 levels.137 In 1765, the Gentlemen XVII ordered that the purchasing price of coffee had to be lowered by a rixdollar per pikol. This, however, was not to be at the expense of the local producers in Cirebon, while any form of coercion was specifically ruled out, too.138 This could only mean that a lower margin was left for intermediaries, such as the local elite or Chinese middlemen. In return for coffee and other commodities, the VOC sent money to Cirebon, in the mid-1770s, consisting for a large part—approximately 950,000 pieces annually—of duiten.139 From 1778, VOC officials were appointed to personally monitor that the coffee planters received an immediate and full payment for their deliveries to the Javanese noblemen (regenten). The Fourth Anglo-Dutch War (1780-1784) prevented a strict execution of the policy, as the Company suffered during this period from a shoratage of cash. After the war, coffee was seen as one of the trades that could enable the Company’s recovery, which led to further stimulation of the cultivation.140

Insufficient quantities of cash could hamper coffee cultivation; without a monetary reward the Javanese lacked the incentive to produce the crop. Such was the case in early July 1785. A first step to meet the demand for cash was to provide coffee producers with a cash advance, specifying that at least part thereof was to consist of copper duiten.141 That this was not enough becomes evident from a report that the examiner for inland affairs, Leendert Rollf, submitted to the High Government a few weeks later. He stated that a further lack of cash would lead to decline in the coffee cultivation in the Java mountain region. The High Government was convinced by his analysis and deemed a decline of coffee production problematic as well. Not only had it to deal with this problem, but it was also constrained by the limited amounts of cash in the Company’s coffers. Eventually, the High Government allowed Rollf to issue paper money with a 6% discount rate, so that he might have sufficient cash to to purchase coffee from the local producers.142 Just as with sugar, so too local producers’ preference was for cash in smaller currencies, rather than letters of credit.143 This thus forced the Company to adopt the indirect solution of first selling credit paper at a loss to obtain cash needed to maintain coffee production.

The demand for Javanese coffee was further fostered by decreasing supplies from the Caribbean in the early 1790s, due to the uprising of Toussaint Louverture in nowadays Haiti.144 How these developments on the global coffee market eventually affected the common man’s daily transactions is hard to observe for most of the eighteenth century. This is partly due to the control of the local elites over the coffee production and the distribution of the revenues.145 For the early nineteenth century, there are some indications that duiten were the preferred means for coffee purchases coffee. In 1803, a shipment of duiten was allocated to purchase coffee.146 In 1807, we also hear about the importance of sufficient quantities of duiten to purchase coffee from commoners in Priangan.147 The duiten had become the general means of payment for coffee, at least from the 1770s, when their quantities had been significantly increased and perhaps even as early as the 1730s. Yet when their quantities fell short, coffee production came to a halt, illustrating the importance of specific types of cash for the VOC to obtain the desired products.

5 Conclusion

By reconstructing the chain of demand, from ordinary Javanese, through the local elites, the Asian VOC officials and Batavia’s High Government to the Board of Directors in Amsterdam, this paper demonstrates that the Javanese’s currency preferences were visible in the exports from Europe. With the VOC’s increasing involvement in Javanese society from the 1680s, the demand for smaller-denomination coins increased as well.

The VOC was not in a position to impose its will, let alone subjugate the economy, as other studies have already showed. The VOC’s inability to end the recurrent warfare, in spite of its ambitions, illustrates this relative weak position. When peace was finally established after 1755, Java’s economy grew. Studies by Nagtegaal and De Zwart and Van Zanden have even tentatively suggested that it is possible that the VOC’s involvement had positive consequences. This paper demonstrates that with regard to the money supply, considerations of state prevailed over purely business interests. By offering fixed and often high purchasing prices, the VOC functioned as a buffer between the local producers and the global market, and protected them against price fluctuations. Rice producers, the Batavian poor and Company employees were similarly protected against either too high or too low rice prices. This allowed the Javanese to benefit from the Company’s global connections, while the VOC bore part of the risk of the price fluctuations. As such, the VOC did not aim to plunder the Javanese economy, but rather acted a as morally responsible ruler.

The analysis of VOC’s monetary flows shows that it responded to specific monetary needs to let its Asian operations function as smoothly as possible. The money wished for in the Requests from the Indies correspond fairly well to those that the company shipped to Asia. The export figures thus form a relatively representative indication of the needs of the VOC in Asia. The currency supply was demand-driven.

Those needs shifted throughout the late seventeenth and eighteenth centuries: an increasing involvement with Java’s growing economy resulted in different needs for the VOC in Batavia. The shifting balance in its role on Java—from merchant to state—was visible in the VOC’s increasing demand for lower-denomination cash coins. The VOC’s sources thus give a voice to the indigenous population, even when we lack indigenous sources.

The VOC’s changing role intensified the contact the company’s contact with the local producers. As a ruler the VOC had to respond to their needs. It could not just enforce the acceptance of all means of payments. Insofar as we can determine, the rice producers demanded certain types of money: by the late sixteenth century picis, until the mid-eighteenth century dubbeltjes and thereafter duiten. The payment for coffee followed a similar pattern of the local preference for certain types of coins. Insufficient quantities of those currencies subsequently led to purchasing problems.

Consequently, the VOC’s behaviour in monetary affairs is best understood as a response to local demand. The growing Dutch involvement did not result in an outright repression of Java’s population, a subjugation of the existing powerholders or even the disruption of the economy. Instead, the Dutch presence appears to have had certain benefits, not because of its power, but because of its lack thereof. This forced the Company to take the local powerholders and their interests into account and comply with their preferences.

Acknowledgments

The author wishes to thank Ulbe Bosma, Joost Schokkenbroek, Christiaan van Bochove, Remco Raben, the participants in the Wageningen Rural History seminar and the AAS Workshop “New Frontiers in Asian Economic History” in Lansing, Michigan, and the “Multiple payment systems in globalizing economies” workshop in Osaka and session of the same name at the Boston WEHC 2018 and the anonymous referee for their valuable feedback on earlier drafts of this paper.

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