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The Auction System in the Port of New York, 1817–1837

Published online by Cambridge University Press:  11 June 2012

Ira Cohen
Ira Cohen
Affiliation:
Assistant Professor of History, Illinois State University
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Abstract

Professor Cohen recounts the operations of the famed auction system in New York, suggesting reasons for its success in the years after the War of 1812 and its decline in the decade of the 1830's.

Type
Research Article
Information
Business History Review , Volume 45 , Issue 4 , Winter 1971 , pp. 488 - 510
Copyright
Copyright © The President and Fellows of Harvard College 1971

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References

1 Albion, R. G., The Rise of New York Port (New York, 1939)Google Scholar.

2 The chief study of the auction system per se is Westerfield, Ray, “Early History of American Auctions — A Chapter in Commercial History,” Transactions of the Connecticut Academy of Arts and Sciences, XXIII (May, 1920), 159–210Google Scholar; though Norman Buck, Sidney, The Development of the Organization of the Anglo-American Trade (New Haven, Conn., 1925), 135Google Scholar ff., is perhaps the best available study of the auction system.

3 Cassady, Ralph Jr., Auctions and Auctioneering (Berkeley and Los Angeles, 1967), 11–29Google Scholar.

4 Nettels, Curtis P., The Emergence of a National Economy (New York, 1962), 202Google Scholar.

5 Robert Cheseborough to John Taylor, December 8, 1820, John Taylor Papers, New York Historical Society. Hereafter cited as Taylor Papers. Cheseborough played an active role in the anti-auction movement.

6 Albion, Rise of New York Port, 12; Buck, Anglo-American Trade, 136, 137.

7 New York Evening Post, January 11, 1817; Buck, Anglo-American Trade, 137, 138.

8 Niles' Register, June 4, 1815, 290.

9 Morison, Samuel Eliot, The Maritime History of Massachusetts (Boston, 1961), 195–212Google Scholar.

10 Buck, Anglo-American Trade, 98 and passim.

11 Ibid., 144 ff., has an excellent discussion of the pros and cons of the various means of collecting tariffs.

12 Sir Clapham, John, The Bank of England, A History (New York, 1945), II, 61Google Scholar; Gayer, Arthur D. et al. , The Growth and Fluctuation of the British Economy, 1790–1850 (Oxford, 1953), I, 132Google Scholar.

13 Memorial of the Auctioneers of the City of New York (Washington, 1821), 4–6Google Scholar.

14 Williams, Edwin, ed., New York Annual Register (New York, 1833), 143Google Scholar. The actual figures were $13,161,749.77 total auction sales and $12,124,054.76 dutiable sales.

15 Buck, Anglo-American Trade, 138.

16 Fetter, Frank W., Development of British Monetary Orthodoxy, 1797–1875 (Cambridge, Mass., 1965), 64Google Scholar ff.; Gayer, et al., British Economy, 132. Gayer sees major weaknesses in the British economy which were intensified by the decision to resume specie payments.

17 Clapham, , Bank of England, II, 57Google Scholar ff.; Fetter, Development, 64; Gayer, et al. , British Economy, I, 132Google Scholar.

18 Westerfield, “Early American Auctions,” 164.

19 Ibid., 165.

20 Quoted in Buck, Anglo-American Trade, 139. A similar report can be found in the New York Commercial Advertiser of February 22, 1817, quoting a November issue of the Liverpool Mercury: “The American ship Electra has brought back fifty thousand Pounds value in British merchandise from the United States which could not be sold in the United States at half their original cost.”

21 Bolles, Albert S., The Financial History of the United States (New York, 1883), I, 388Google Scholar.

22 Robert Cheseborough to John Taylor, December 8, 1820, Taylor Papers. There was one other means of quickly selling inventories. That was through the use of a jobber who would offer a flat price for the entire inventory. He would then break up what he bought into smaller lots and sell them to retailers. See The Beneficial Tendency of Auctioneering and the Danger in Restraining It (New York, 1817)Google Scholar. This is a pro-auction pamphlet; however, the New York National Advocate of December 25, 1819 carries a similar statement.

23 Barck, Dorothy, ed., Letters from John Pintard to His Daughter (New York, 1937–1940), I, 5Google Scholar (April 3, 1816).

24 Buck, Anglo-American Trade, 139; Mies' Register (July 13, 1816), 322.

25 New York Evening Post, May to December, 1816; New York Daily Advertiser, May to December, 1816.

23 Shaw, Ronald E., Erie Water West: A History of the Erie Canal, 1792–18 (Lexington, Ky., 1966), 70–73Google Scholar; Miller, Nathan, The Enterprise of a Free People: Aspects of Economic Development during the Canal Period, 1792–1838 (Ithaca, N.Y., 1962), 66–70Google Scholar; Joseph Ellicott to De Witt Clinton, March 25, 1816, and Draft of a Report in Regard to Financing the Canal, n.d. (attributed to 1816), fa the De Witt Clinton Papers, Columbia University Library.

21 “Auction System in New York,” Hunt's Merchant Magazine, X (1844), 154–57Google Scholar; the Auction Law yielded $1,247,319.21 for the support of the Canal. New York State Comptroller Report in New York State Assembly, Documents (1845), Document Number 208 (March 31, 1845).

28 Laws of New York, Fortieth Session, Chapter CCLXXV.

29 Richard Babington, Law of Auctions, 23; Ralph Cassady, Auctions.

30 “An Act to Regulate Sales by Public Auction,” Chapter CCLXXV, Laws of New York, Fortieth Session, 326–333, section I.

31 Ibid., section IV for the types of goods traditionally sold in the streets or at pierside. Street sales frequently became a public nuisance; see New York City Common Council, Minutes, X (June 28, 1819), 451 and 453Google Scholar, XI (May 22, 1820), 158, XI (April 2, 1821), 567–68, and XV (November 21, 1825), 28.

32 “An Act Regulating Sales at Auction,” section X (auctions of books and art were exempted from this part of the law); sections XIII, XIV, XVI.

33 Johnson, Emory R. et al. , History of the Domestic and Foreign Commerce of the United States (Washington, 1925), II, 30–41Google Scholar.

34 Buck, Anglo-American Trade, 98 ff. There is no usable estimate of the number of British commercial representatives in the United States in the period before 1812.

35 The number of English agents, and other English nationals in New York, was sufficiently large to support a newspaper, the New York Albion, 1822–1875.

36 Bolles, Financial History of the United States, 389; Remarks Upon the Auction System as Practiced in New York, by a Plain Practical Man (New York, 1828)Google Scholar, passim. For a more balanced contemporary view, see The Memorial of the Chamber of Commerce of the City of New York (Washington, 1820), 6Google Scholar.

37 Buck, Anglo-American Trade, 149.

38 Juglar, Clement, A Brief History of Panics (New York, 1966, reprint of 1916 ed.), 41–53Google Scholar; Catterall, Ralph, The Second Bank of the United States (Chicago, 1903), 54–57Google Scholar; Bolles, Financial History, 323–26.

39 Rothbard, Murray, The Panic of 1819 (New York and London, 1962), 10–14Google Scholar; Johnson, et al, Domestic and Foreign Commerce, 30 ff.

40 See Table I.

41 McMaster, John B., A History of the People of the United States (New York, 1911), IV, 319ff and 511–13Google Scholar; Bolles, Financial History, 388–393; Dangerfield, George, The Era of Good Feelings (New York, 1953), 177–78Google Scholar; Dangerfield, George, The Awakening of American Nationalism (New York, 1965), 72–74Google Scholar.

42 Clark, Victor S., History of Manufactures in the United States (Washington, 1929), 240–42Google Scholar; North, D. C., The Economic Growth of the United States, 1790–1860 (N.Y., 1966), 61–62Google Scholar; Bolles, Financial History, 387ff.

43 Niles' Register, June 10, 1820, 151: “Rich and extensive associations have been formed in Great Britain and large sums of money subscribed for the purpose of putting down American manufacturers. This association seems to have agreed to sacrifice the sum of 300,000 pounds sterling ($1,332,000) … to inundate our country.”

44 American State Papers, Finance, III, 168–69, “Protection to the Manufacturing and Mercantile Interests.”

45 Niles' Register, June 24, 1815, 290; July 13, 1816, 322-23; January 22, 1820, 337.

46 Ware, Caroline, The Early New England Cotton Manufacture (Cambridge, Mass., 1931), 66Google Scholar.

47 “Report of the American Society for Manufactures,” New York Evening Post, June 14, 1817; Address of the Philadelphia Society for the Promotion of Manufactures (1819); Memorial of a Convention of Friends of National Industry (1819). Between 1815 and 1817, Hezekiah Niles, the leading propagandist for protection, largely ignored auctions, but from 1817 onward he was a leading opponent of them. See, for example, Niles' Register, January 13, 1818, 312, January 22, 1820, 337, July 21, 1821, 322–23, 1824–1825, 257–288, 273–75, 289–291, 305–306; or almost any other volume of the Register for this period.

48 Report of the Joint Committee of Manufacturers of the Legislature of New York,” in Niles' Register, July 7, 1817, 231.

49 Cole, Arthur H., The American Wool Manufacture (Cambridge, Mass., 1926), I, 214–18Google Scholar; Ware, New England Cotton, 166–176.

50 Ware, , New England Cotton, 172–73Google Scholar; Cole, , American Wool, I, 216Google Scholar.

51 Cole, , American Wool, I, 214Google Scholar.

52 Ware, New England Cotton, 175; Cole, , American Wool, I, 217Google Scholar. See also the anctioneers' prediction of this in their memorial to Congress in 1821, in American State Papers, Finance, III, 585–86.

53 Ware, New England Cotton, 175; Cole, , American Wool, I, 149Google Scholar.

54 Ware, New England Cotton, 175.

55 Ibid., 176.

56 Stokes, I. N. P., The Iconography of Manhattan Island (New York, 1926), V, 1, 596Google Scholar.

57 Albion, New York Port, 280; Taylor, George R., The Transportation Revolution (New York, 1951), 297Google Scholar. See also Longworth's New York City Directory for any year in this period.

58 American State Papers, Finance, III, 583.

59 Ibid., 583–84.

60 lbid., 584.

61 New York Journal of Commerce, February 15, 1828.

62 Buck, Anglo-American Trade, 160.

63 Scoville, Joseph [Barrett, Walter], The Old Merchants of New York (New York, 1883), I, 389Google Scholar.

64 Bolles, Financial History, 389; Nevins, Allan, A History of the Bank of New York (New York, 1934), 49Google Scholar; Knowles, Charles E., History of the Bank for Savings (New York, 1929), 150Google Scholar; Lanier, Henry W., A Century of Banking in New York (New York, 1922), 96, 112–13, 122, 314Google Scholar; Wardenbrook, William, Financial New York (New York, 1897), 176, 188, 226Google Scholar.

65 Scoville, , Old Merchants, I, 138Google Scholar.

66 Ibid., V, 34.

67 Buck, Anglo-American Trade, 14ff.

68 Scoville, , Old Merchants, IV, 129Google Scholar: “If an East India House had teas or silks worth $2,000,000, Haggerty and Austin could advance all they needed.”

69 An Examination of the Reasons Why the Present System of Auctions Ought to be Abolished (Boston, 1828), 14Google Scholarff; Remarks Upon the Auction System, 52–54; [Asa Greene], Perils of Pearl Street, 102, 103.

70 An Examination of the Reasons, 14.

71 New York Commercial Advertiser, January 24, 1826.

72 Remarks Upon the Auction System, 35.

73 An Examination of the Reasons, 14–15.

74 Examples of endorsements by auctioneers can be found in the Acceptance Books, Brown Brothers Papers, New York Public Library. On November 15, 1833, there were eleven endorsements by Adee, Timpson & Company and forty-six by Hone and Company; on September 15, 1834 there were forty-eight endorsements by Austen & Wilmerding.

75 American State Papers, Finance, III, 584.

76 New Brunswick Fredonian, October 17, 1816.

77 Scoville, , Old Merchants, I, 84, 85Google Scholar.

78 Quoted in Jones, Fred M., “Middlemen in the Domestic Trade of the United States, 1800–1860,” Illinois Studies in the Social Sciences, XXI (1937), 52Google Scholar.

79 Scoville, , Old Merchants, I, 323Google Scholar.

80 Quoted in Jones, “Middlemen,” 52.

81 Niles' Register, July 26, 1828, 350.

82 Remarks Upon the Auction System, 48–52, within which the fluctuation charge may also be found.

83 American State Papers, Finance, III, 584.

84 The American silk importer F. Varet & Company sold only through J. & P. Hone; see Scoville, , Old Merchants, II, 113Google Scholar. J. J. Astor used the Hones to dispose of his imported teas; see the same source, II, 88–89.

85 North, Economic Growth of the United States, 185. For the situation in Boston, see Morison, Maritime History of Massachusetts, 273ff; for Philadelphia and Baltimore, see Livingood, James W., The Philadelphia-Baltimore Trade Rivalry (Harrisburg, Pa., 1947) 18–20Google Scholar.

86 “In whatever seaport the southern and western merchant purchases his supply of goods, the products of his country will tend towards it. Of late a large portion of them has centered in New York, and the effects have been commensurate. Our mechanics have been employed; our commercial activity heightened; and our property enhanced.” Beneficial Tendency of Auctions, 15.

87 For the auctioneers' claim see An Examination of Remarks Upon the Auction System (New York, 1831), 4 and 9Google Scholar; Niles' Register, October 13, 1821, 103.

88 Johnson, et al. , Domestic and Foreign Commerce, II, 39Google Scholar; North, Economic Growth of the United States, 194ff.

89 Buck, Anglo-American Trade, 153ff.

90 Ibid.; Albion, Rise of New York Port, 237.

91 Ibid., 321ff.

92 Buck, Anglo-American Trade, 154ff.

93 Quoted in ibid., 155.

94 Tooke, Thomas B. with Newmarch, William, A History of Prices (London, 1839–1857), II, 253; IV, 469Google Scholar.

95 Ibid., III, 60; Gayer, et al. , British Economy, II, 250–53, 264–67Google Scholar.

96 The firms that arose from the dissolution of Haggerty and Austen were: John Haggerty & Sons, Austen, Speer & Company, and Wilmerding, Priest & Mount. Scoville, , Old Merchants, I, 115Google Scholar.

97 Jones, “Middlemen,” 41–42, 51–52.

98 Ibid.; Westerfield, “Early History of American Auctions,” 182–85; [Asa Greene], The Perils of Pearl Street, 57ff.

99 Westerfield, “Early History of American Auctions,” 185.

100 Taylor, Transportation Revolution, 397.

101 New York State Assembly Document 218, 12; Buck, Anglo-American Trade, 160–61.

102 Ware, New England Cotton, 176.

103 Ibid., 177–180; see also DePew, M. Chauncy, ed., 1795–1895, One Hundred Years of American Commerce (New York, 1895), 556Google Scholarff.

104 The fullest discussion of the financial events leading up to the Panic are in Govan, Thomas, Nicholas Biddle, Nationalist and Bank (Chicago, 1959), 297–98Google Scholar; Dorfman, Joseph, The Economic Mind in American Civilization (New York, 1944), II, 69ffGoogle Scholar; Benton, Thomas H., Thirty Years in the United States Senate (New York, 1854), I, 676–78Google Scholar; Van Deusen, Glyndon G., The Jacksonian Era (New York, 1963), 104–106Google Scholar; Blau, Joseph, ed., Social Theories of Jacksonian Democracy (New York, 1954), 183–198Google Scholar.

105 Govan, Biddle, 301.

106 Clapham, Bank of England, 150–51; Andreades, A., History of the Bank of England, 1640–1903 (New York, 1966), 265Google Scholar.

107 Andreades, Bank of England, 268.

108 Clapham, Bank of England, 152; Govan, Biddle, 306–307; Tuckerman, Bayard, ed., The Diary of Philip Hone (New York, 1889), I, 248Google Scholar, Scoville, , Old Merchants, V, 34Google Scholar.

109 Gayer, et al. , British Economy, I, 282–83Google Scholar. The United States trade accounted for 10 per cent of England's foreign trade in 1837.

110 Williams Annual Register, 1845, 146. In 1846 the number was sixty-six. See also Doggett's New York Business Directory for 1846 and 1847, Part II.