Fyriskipanin frá 3.5.1723 um handil í Føroyum og kærurnar um hana

Abstract

As long as trade in the Faroes was a monopol in the gift of the Danish king, prices were fixed by law. In deciding the prices, the civil servants in Copenhagen had to take various factors into consideration. One was to maintain the population and the economic life of the islands, while another — especially when trade was the direct concern of the Crown — was to ensure a profit. On the other hand the various groups in the Faroes also had their special interests which were dictated by production
and consumption.

In 1691, at a time when the trade monopoly had been leased out, the price of wool had been fíxed at a very hígh level, over twice the market price. At the same time, however, in order to limit the production of hose (which was far greater than demand), a quota system was introduced, according to which only a certain proportion of the wool could be sold in the form of finished goods.

The high price of wool made the trade unprofitable, but at the same time it was advantageous for the clergy and civil servants who had large incomes based on wool on the one hand and for the wealthiest farmers cn the other. But the poorer farmers and people who did not own land were most interested in producing finished goods from their wool; those without land also wanted a low price for wool, as they had to buy it.

When, in 1709, the King took over the trade monopoly, the time was ripe for change, and both during preparatory discussions on the new charges of the 3rd May 1723 and in subsequent negotiations between Faroese delegates and civil servants in Copenhagen on changes in the new charges, the different interests in the Faroese community are clearly to be seen.

The result of the negotiations was that the price of wool was not reduced by so much as had originally been agreed; but this concession never took effect as plans for leasing the trade came to nothing, and so the civil servants came to the conclusion that there was no economic foundation for the concession.