In Ancient pre-Imperial China,the tribes living in what is now the Yellow River valley were practising agriculture. Merchants were highly regarded as necessary for the circulation of essential goods. The legendary Emperor Shun, prior to receiving the throne from his predecessor, was said to be a merchant.
The Shang Dynasty used spindle-wheels to make textiles, but the Shang labour force was more formally organised. By Shang times, controlled workers produced silk in workshops for the aristocracy.
Handicraft industries developed during the Shang, such as textiles, bronze, and the production of weapons, were continued during the Zhou but became completely state-controlled. The Zhou government also controlled most commerce and exchange through appointing jia, officials whose title was later used to mean any merchant.
In the Spring and Autumn Period, Hegemon of China Duke Huan of Qi appointed Guan Zhong, a merchant, as Prime Minister.
Large-scale trade began in the Spring and Autumn period as merchants transported goods between states. Large amounts of currency were issued to accommodate commerce.
Guan Zhong was born in Yingshang, and became acquainted with Bao Shuya at an early age, when they became business partners. The Records of Grand Historian records that, as partner, Guan Zhong often took more than his share of the profits, in effect cheating Bao Shuya. Bao, however, recognised his impoverished background and was not offended.
Under Guan’s guidance several important economic reforms were introduced. He created a uniform tax code and also used state power to encourage the production of salt and iron. He believed that monopolizing the nature resources was helpful on improving the government income, with fewer complaints from the public than raising taxes.
Commerce was frequent after the Han Dynasty, especially with the development of the silk road.
In Imperial China, the merchants, traders, and peddlers of goods were viewed by the scholarly elite as essential members of society, yet were esteemed least of the four occupations in society, due to the view that they were crafty and posed a threat to social harmony.
Despite this, the merchant class of China throughout all of Chinese history were usually wealthy and held considerable influence above their supposed social standing.
Han Dynasty writers mention merchants owning huge tracts of land. Some merchant families made fortunes worth over a hundred million cash, which was equivalent to the wealth acquired by the highest officials in government.
The reigns of the Emperors Wen and Jing were a period of peace and prosperity.
Both the private and public sectors flourished during this period. Under Emperor Jing, “the ropes used to hang the bags of coins were breaking apart due to the weight, and bags of grain which had been stored for several years were rotting because they had been neglected and not eaten”.
During the Sui and Tang Dynasties, the Central government encouraged foreign merchants to travel to China and import goods, and built numerous hotels to house them.
During the Song dynasty, the merchant class became more sophisticated, well-respected, and organised.
Chinese society became increasingly commercialized from the Song dynasty onward, Confucianism had gradually begun to accept and even support business and trade as legitimate and viable professions, as long as merchants stayed away from unethical actions.
Paper money, the compass, and other technological advances facilitated communication on a large scale and the widespread circulation of books. Song abolition of trade restrictions greatly aided the economy.
Song dynasty merchants “set up partnerships and joint stock companies, with a separation of owners (shareholders) and managers. In large cities, merchants were organised into guilds according to the type of product sold; they periodically set prices and arranged sales from wholesalers to shop owners. When the government requisitioned goods or assessed taxes, it dealt with the guild heads.”
By the late Ming Dynasty, the officials often needed to solicit funds from powerful merchants to build new roads, schools, bridges, pagodas, or engage in essential industries, such as book-making, which aided the gentry class in education for the imperial examinations. Merchants began to imitate the highly cultivated nature and manners of scholar-officials in order to appear more cultured and gain higher prestige and acceptance by the scholarly elite.
The Ming government collected far less revenue than the Song dynasty. The Cambridge history of China volume on the Ming Dynasty stated that “Ming government allowed those Chinese people who could attain more than mere subsistence to employ their resources mostly for the uses freely chosen by them, for it was a government that, by comparison with others throughout the world then and later, taxed the people at very low levels and left most of the wealth generated by its productive people in the regions where that wealth was produced”.
Zhu Yuanzhang had promoted foreign trade as a source of revenue while he was a rebel, but sharply curtailed this with a series of sea bans once in power.
Although international trade was sophisticated and well-developed during the Qing Dynasty, the Qianlong Emperor notably proclaiming that “Our land is so wealthy and prosperous that we possess all things. Therefore, there is no need to exchange the produce of foreign barbarians for our own.”
Although within traditional Confucian doctrine Merchants, because they did not create anything within society, did not hold high societal standing, merchants became incredibly rich off of this domestic trade. From petty merchants at the local village level to merchants moving between metropolitan centers of trade and production, many traders joined the Dynasty’s inner trade. These merchants, often those who studied for the civil service exam but could not find a post or pass the exam, gained wealth and prosperity within their new profession.
Merchants banded in organisations known as huiguan (会馆) or gongsuo（公所）; pooling capital was popular as it distributed risk and eased the barriers to market entry.
By staff editor