Celebrating UCL's Bicentennial: Examining 200 Years of UK Trade History

What would surprise a merchant from 1826?

 

An interesting way to mark UCL’s Bicentennial is to treat it as a prompt: what would surprise a merchant about the journey of Britain trade from 1826 to today? The answer is not that Britain still trades (that is expected), however the point of interest is how the contents and character of Britain’s trade have been reshaped over two centuries.

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Bread, Power and Protection: The Corn Laws and Their Repeal (1826-8170) 

Starting with our merchant in 1826, they would have been operating under the Corn Laws (1815–1846). These were tariffs and import restrictions on grain designed to protect landowners and domestic farmers by keeping prices artificially high. This law more generally turned the price of grain from economics to politics, with high income inequality across Britain, as the law helped the rich get richer. There was some change in the law in 1828 where a ‘sliding scale’ tariff was used, wherein the effective tariff rate changed depending on domestic market price, leading to great fluctuations in its rate as shown in Figure 1.

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Figure 1: Average import tariff on wheat and Britain’s wheat imports, 1829-1860

 

Source: VoxEu

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By the mid‑1840s, however, mounting social pressure, economic downturns, and the Irish potato famine pushed Parliament toward repeal. The 1846 decision was an early signal that the UK would be willing to rely on imports for goods like food, and in exchange get cheaper consumption, while focusing on its stronger industrial base. More recent economic analysis suggests that this shift and repeal of the corn laws delivered significant distribution benefits across Britain. From 1846 into the later 19th century, this greater commitment to free trade shaped Britain’s commercial trajectory, marking an era in which industrial output, global shipping, and expanding markets defined the nation’s economic identity.

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Britain as a Global Trade Platform (1870–1914)​

By the late 19th century, Britain had evolved into something far larger than an industrial powerhouse - it had become the world’s commercial operating system. While the country still produced textiles, iron goods, and machinery, it was their shipping, insurance and financial infrastructure that made it the global hegemon. Yet this era was not without its troubles. Competition from Germany and the United States began to erode Britain’s dominance in sectors like chemicals, steel and heavy engineering, even as Britain maintained an edge in commercial services. Still, the underlying assumption remained stable: trade would keep expanding, capital would flow freely, and the underlying architecture of world commerce would be supported by sterling finance and British shipping lanes. However, it was this position of dominance that would make our merchant devastated by the rupture in world trade order from 1914. 

 

War, Fragmentation and the Collapse of the Old Order (1914–1945)

The liberal trading order that had carried Britain through much of the nineteenth century collapsed almost overnight in 1914. The First World War disrupted shipping routes, redirected production toward military needs, and shattered the assumption that capital, goods, and people would move freely across borders. When peace returned, the old framework did not. The interwar years were marked by unstable currencies, competitive devaluations, and a steady rise in protectionism. Britain’s decision to leave the Gold Standard in 1931 symbolised a wider retreat from openness. Tariffs returned, imperial preference was revived, and governments increasingly sheltered domestic industries as global demand weakened. By the late 1930s, the integrated trading world of the nineteenth century had fractured into competing trade blocs. The confidence that had built the Victorian globalisation had largely disappeared, replaced by economic insecurity and a growing emphasis on self-protection, an economic state that shaped Britain’s trade outlook until the rebuilding of the international system after 1945.

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Rebuilding Through Rules and Deepening Integration (1945–2020)

After 1945, Britain played an active role in rebuilding the international trading system through the General Agreement on Tariffs and Trade (GATT). The agreement lowered tariffs, discouraged discrimination, and introduced clearer rules, helping stabilize the global economy after the disruption of the interwar years. In the decades that followed, Britain’s economic focus shifted increasingly toward Europe. Entry into the European Communities in 1973 marked the culmination of a long turn toward regional integration and shared standards. Within the single market, tariffs disappeared and supply chains became more integrated. As Britain evolved into a more service-led economy, sectors such as finance, law, education and the creative industries became central to its competitive advantage. By the 2010s, the EU accounted for about half of UK exports and imports.

 

Post Brexit to the present (2020-2026)

Brexit ended single-market membership and introduced new non-tariff barriers despite zero tariffs under the EU–UK Trade and Cooperation Agreement. Customs checks, rules-of-origin paperwork, and regulatory divergence have increased trade frictions, particularly for smaller firms. Goods exports to the EU remain below their pre-Brexit levels, while services exports have proved more resilient. The EU still accounts for roughly two-fifths of UK exports and around half of imports, underscoring the limits of geographical escape. At the same time, Brexit has enabled the UK to pursue independent trade agreements and deepen trade with non-EU markets. Yet the long-run effects of this deal are still unknown and unfolding.

 

So, what has surprised our merchant?

Our 1826 merchant would recognise Britain’s global ambitions but be astonished by the shift from grain and manufactures to services and regulation. He would see a nation that abandoned agricultural protection, built a global trading hub, watched it fracture in war, rebuilt through multilateral rules, tied itself to Europe, and then voluntarily added friction back into its closest trading relationship. Most surprising of all: Britain now trades less in physical goods than in contracts, standards and digital services. In all of the drastic change through the 200 years since UCL was founded there is a constant, however: our merchants faced issues with tariff regulations in 1826, and two centuries later, tariffs are causing problems again.

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References:

1. Broadberry, S.N. (1998). How Did the United States and Germany Overtake Britain? A Sectoral Analysis of Comparative Productivity Levels, 1870-1990. The Journal of Economic History, [online] 58(2), pp.375–407. Available at: https://www.jstor.org/stable/2566739 [Accessed 14 Mar. 2026].

2. Crafts, (2021). What can we learn from the UK’s post-1945 economic reforms? - WRAP: Warwick Research Archive Portal. Warwick.ac.uk. [online] doi:https://wrap.warwick.ac.uk/id/eprint/158060/1/WRAP-what-can-we-learn-from-UK%E2%80%99s-post-1945-economic-reforms-Crafts-2021.pdf.

3. Crafts, N. (2014). Walking wounded: The British economy in the aftermath of World War I. [online] CEPR. Available at: https://cepr.org/voxeu/columns/walking-wounded-british-economy-aftermath-world-war-i.

4. Harley, C.K. (2004). Trade, 1870–1939: from globalisation to fragmentation. Cambridge University Press eBooks, pp.161–189. doi:https://doi.org/10.1017/chol9780521820370.008.

5. Irwin, D. and Chepeliev, M. (2020). The economic consequences of Sir Robert Peel: A quantitative assessment of the repeal of the Corn Laws. [online] CEPR. Available at: https://cepr.org/voxeu/columns/economic-consequences-sir-robert-peel-quantitative-assessment-repeal-corn-laws [Accessed 14 Mar. 2026].

6. Low, H. and Caswell, B. (2025). Five Years On: The Economic Impact of Brexit. [online] National Institute of Economic and Social Research. Available at: https://niesr.ac.uk/blog/five-years-economic-impact-brexit [Accessed 14 Mar. 2026].

7. The National Archives (2019). The Cultural Revolution. The Cultural Revolution, [online] 1(1). doi:https://www.nationalarchives.gov.uk/.

8. Ward, M. (2019). Statistics on UK-EU trade. [online] Available at: https://www.europe-solidarity.eu/documents/UK_EU_trade.pdf.

9. WTO (1994). WTO | WTO Analytical Index — Guide to WTO Law and Practice (updated electronic version). [online] www.wto.org. Available at: https://www.wto.org/english/res_e/publications_e/ai17_e/gatt1994_e.htm [Accessed 14 Mar. 2026].