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Diversified trading networks have recently drawn a great deal of attention. In the process, the importance of diversity has perhaps been overemphasized. Using the trade in port wine from Portugal to Britain as an example, this essay attempts to show how a market once dominated by general, diversified traders was taken over by dedicated specialists whose success might almost be measured by the degree to which they rejected diversification to form a dedicated "commodity chain." The essay suggests that this strategy was better able to handle matters of quality and the specialized knowledge that port wine required. The essay also highlights the question of power in such a chain. Endemic commodity-chain struggles are clearest in the vertical brand war that broke out in the nineteenth century, which, by concentrating power, marked the final stage in the transformation of the trade from network to vertical integration.
Emphasizing the recent emergence of a "networked society," modern commentators too easily make networks seem particularly new.1 Avner Greif's account of early medieval Maghribi traders, John Padgett and Christopher Ansell's description of the Medicis' trade and banking in the Renaissance, and Fernand Braudel's study of commercial society in early modern Europe all remind us, however, that business networks are in fact remarkably old. In Perry Gaucci's words, the "modern obsession with 'networking' has a long heritage."2 Another problem with many current discussions of networks is that they too easily embrace almost every social arrangement beyond (and perhaps including) the nuclear family. In any discussion, it is important to clarify the kind of network that is being discussed.3 In this essay, I will question some widely accepted assumptions about networks in general by looking at one particular kind of network, the "commodity chain." Terrence Hopkins and Immanuel Wallerstein define such a chain as "a network of labor and production processes whose end result is a finished commodity," indicating that it is indeed a kind of network, but a highly specific one, organized around a particular commodity and often a particular market, toward which it will stretch in a linear fashion from production to consumption.4 Business-history literature, while expansive on networks in general, is remarkably reticent about commodity chains-despite their importance in the history of business. To address this reticence, I...