The Colonial Economy

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What kind of policy did England replace salutary neglect with?

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Salutary neglect was replaced with imperial regulation. Salutary neglect was the British policy toward the American colonies that looked the other way when the colonists did not obey British trade laws. For example, colonists were supposed collect duties (taxes) on goods they purchased from countries other than Britain and were not supposed to sell raw materials, such as tobacco, to countries other than Britain. What the British envisioned when they established the colonies was a completely regulated market: the colonists were expected only to sell to England and buy from England. The English would make huge profits buying raw materials cheaply and then selling back finished goods at high prices.

The British, however, made so much money from the colonies and were so concerned with European politics and consolidating themselves as a world power that they came to realize it was (seemingly) no problem to let the Americans ignore the law and trade on the side with countries such as Holland and France.

However, in hindsight, this did create a problem. The Americans got used to running their own business enterprises and living free of British interference. When George III replaced the policy of salutary neglect with that of imperial regulation, putting an emphasis on collecting taxes and overseeing the Americans, he created a vast amount of discontent and resentment on the part of the colonists.

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