Tom Goldstein, "Economic Manipulation:
J.A. Hobson's Theory on the
Role of Economic and Other Forces in Imperialism"


according to Hobson's statistics, have not generated any great benefit to the British economy. So why is it that the great powers of Europe spend a great deal of money and lose a great many lives in order to acquire these unproductive territories?

II. Hobson's Theory of Imperialism

Hobson's basic argument is that the economic forces of overproduction and under-consumption cause imperialism. Economic forces take precedence over other forces such as morality, nationalism, political reasons, social forces, etc., forming the "taproot of imperialism." A taproot is the main root in a plant from which smaller roots spring out. Hobson asserts that economic forces are therefore the main root of imperialism and from this main root springs smaller, non-economic forces. All roots are needed for the plant to grow, but the center root - economic forces - is the coordinating and most important root. Hobson argues that the economic forces of over-production and subsequent under-consumption spark a complex chain of events that result in imperialism. In order to understand this progression we must delve further into Hobson's theory.

The primary stimulus for the entire chain reaction is the capitalist system. Hobson explains that capitalism, by nature, creates a competitive environment in which goods and service are bought and sold. This competition leads firms to overproduce goods, as they think that the more of the goods they produce, the higher the profit they will make. Yet to their dismay, the consumers often do not absorb this extra supply leaving the market flooded with goods and driving the price of those goods down. When this happens, " . . . All the mills and factories can only be kept at work by cutting prices

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