Trading with the Enemy

4 01 2012


Over on the Marginal Revolution blog, Tyler Cowen, an economist at George Mason University, has been discussing journalist Adam Hochschild’s new history of the First World War, To End All Wars: A Story of Loyalty and Rebellion, 1914-1918. Cowen is evidently fascinated by something Hochschild mentions, namely, that during this conflict, the British and German governments exchanged goods they needed for their respective war efforts. Using the Swiss as intermediaries, the two combatants traded German binoculars, which were required by British soldiers on the Western front, for the rubber desperately needed by the German army.  

I must confess that I had never heard of this example of trading with the enemy. I’m wondering whether the readers of this blog, who include many historians of the 20th century business, know more about it.

The First World War is conceived of as a total war in which both sides engaged in merciless tactics designed to destroy the entire economy of the opponent. Indeed, the British and the Germans used blockades to try to starve the enemy civilian populations out of the war. Despite this, some trade between combatants went on, apparently with the full support of national governments. In this sense, the First World War seems a bit like the relatively limited wars of the eighteenth century.





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