International Economics 9th Edition

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Chapter 6
The Standard Trade Model

◼ Chapter Organization
A Standard Model of a Trading Economy
Production Possibilities and Relative Supply
Relative Prices and Demand
The Welfare Effect of Changes in the Terms of Trade
Determining Relative Prices
Economic Growth: A Shift of the RS Curve
Growth and the Production Possibility Frontier
World Relative Supply and the Terms of Trade
International Effects of Growth
Case Study: Has the Growth of Newly Industrializing Countries Hurt Advanced Nations?
Tariffs and Export Subsidies: Simultaneous Shifts in RS and RD
Relative Demand and Supply Effects of a Tariff
Effects of an Export Subsidy
Implications of Terms of Trade Effects: Who Gains and Who Loses?
International Borrowing and Lending
Intertemporal Production Possibilities and Trade
The Real Interest Rate
Intertemporal Comparative Advantage
Summary
APPENDIX TO CHAPTER 6: More on Intertemporal Trade

◼ Chapter Overview
Previous chapters have highlighted specific sources of comparative advantage which give rise to
international trade. This chapter presents a general model which admits previous models as special cases.
This “standard trade model” is the workhorse of international trade theory and can be used to address a wide
range of issues. Some of these issues, such as the welfare and distributional effects of economic growth,
transfers between nations, and tariffs and subsidies on traded goods, are considered in this chapter.

©2012 Pearson Education, Inc. Publishing as Addison Wesley

 Chapter 6 The Standard Trade Model 25

The standard trade model is based upon four relationships. First, an economy will produce at the point where
the production possibilities curve is tangent to the relative price line (called the isovalue line). Second,
indifference curves describe the tastes of an economy, and the consumption point for that economy is
found at the tangency of the budget line and the highest indifference curve. These two relationships yield
the familiar general equilibrium trade diagram for a small economy (one which takes as given the terms of
trade), where the consumption point and production point are the tangencies of the isovalue line with the
highest indifference curve and the production possibilities frontier, respectively.

You may want to work with this standard diagram to demonstrate a number of basic points. First, an autarkic
economy must produce what it consumes, which determines the equilibrium price ratio; and second, opening
an economy to trade shifts the price ratio line and unambiguously increases welfare. Third, an improvement
in the terms of trade increases welfare in the economy. Fourth, it is straightforward to move from a small
country analysis to a two-country analysis by introducing a structure of world relative demand and supply
curves which determine relative prices.

These relationships can be used in conjunction with the Rybczynski and the Stolper-Samuelson theorems
from the previous chapter to address a range of issues. For example, you can consider whether the dramatic
economic growth of countries like Japan and Korea has helped or hurt the United States as a whole, and
also identify the classes of individuals within the United States who have been hurt by the particular growth
biases of these countries. In teaching these points, it might be interesting and useful to relate them to current
events. For example, you can lead a class discussion on the implications for the United States of the
provision of forms of technical and economic assistance to the emerging economies around the world or
the ways in which a world recession can lead to a fall in demand for U.S. export goods.

The example provided in the text considers the popular arguments in the media that growth in Japan or
Korea hurts the United States. The analysis presented in this chapter demonstrates that the bias of growth
is important in determining welfare effects rather than the country in which growth occurs. The existence
of biased growth and the possibility of immiserizing growth are discussed. The Relative Supply (RS) and
Relative Demand (RD) curves illustrate the effect of biased growth on the terms of trade. The new terms
of trade line can be used with the general equilibrium analysis to find the welfare effects of growth. A general
principle which emerges is that a country which experiences export-biased growth will have a deterioration
in its terms of trade, while a country which experiences import-biased growth has an improvement in its
terms of trade. A case study points out that growth in the rest of the world has made other countries more
like the United States. This import-biased growth has worsened the terms of trade for the United States.

The second area to which the standard trade model is applied are the effects of tariffs and export subsidies
on welfare and terms of trade. The analysis proceeds by recognizing that tariffs or subsidies shift both the
relative supply and relative demand curves. A tariff on imports improves the terms of trade, expressed in
external prices, while a subsidy on exports worsens terms of trade. The size of the effect depends upon the
size of the country in the world. Tariffs and subsidies also impose distortionary costs upon the economy.
Thus, if a country is large enough, there may be an optimum, nonzero tariff. Export subsidies, however,
only impose costs upon an economy. Internationally, tariffs aid import-competing sectors and hurt export
sectors while subsidies have the opposite effect.

The chapter then closes with a discussion of international borrowing and lending. The standard trade model is
adapted to trade in consumption across time. The relative price of future consumption is defined as 1/(1 + r),
where r is the real interest rate. Countries with relatively high real interest rates (newly industrializing
countries with high investment returns for example) will be biased toward future consumption, and will
effectively “export” future consumption by borrowing from established developed countries with relatively
lower real interest rates.

© 2012 Pearson Education, Inc. Publishing as Addison-Wesley

26 Krugman/Obstfeld/Melitz • International Economics: Theory & Policy, Ninth Edition

◼ Answers to Textbook Problems

1.

Note how welfare in both countries increases as the two countries move from production
patterns governed by domestic prices (dashed line) to production patterns governed by world
prices (straight line).

2.

In panel a, the reduction of Norway’s production possibilities away from fish cause the production of
fish relative to automobiles to fall. Thus, despite the higher relative price of fish exports, Norway moves
down to a lower indifference curve representing a drop in welfare.
In panel b, the increase in the relative price of fish shifts causes Norway’s relative production of fish
to rise (despite the reduction in fish productivity). Thus, the increase in the relative price of fish exports
allows Norway to move to a higher indifference curve and higher welfare.

3. An increase in the terms of trade increases welfare when the PPF is right-angled. The production
point is the corner of the PPF. The consumption point is the tangency of the relative price line and the
highest indifference curve. An improvement in the terms of trade rotates the relative price line about
its intercept with the PPF rectangle (since there is no substitution of immobile factors, the production
point stays fixed). The economy can then reach a higher indifference curve. Intuitively, although there
is no supply response, the economy receives more for the exports it supplies and pays less for the
imports it purchases.

© 2012 Pearson Education, Inc. Publishing as Addison-Wesley

 Chapter 6 The Standard Trade Model 27

4. The difference from the standard diagram is that the indifference curves are right angles rather than
smooth curves. Here, a terms of trade increase enables an economy to move to a higher indifference
curve. The income expansion path for this economy is a ray from the origin. A terms of trade
improvement moves the consumption point further out along the ray.

5. The terms of trade of Japan, a manufactures (M) exporter and a raw materials (R) importer, is the world
relative price of manufactures in terms of raw materials (pM /pR). The terms of trade change can be
determined by the shifts in the world relative supply and demand (manufactures relative to raw materials)
curves. Note that in the following answers, world relative supply (RS) and relative demand (RD) are
always M relative to R. We consider all countries to be large, such that changes affect the world
relative price.
a. Oil supply disruption from the Middle East decreases the supply of raw materials, which increases
the world relative supply of manufactures to raw materials. The world relative supply curve shifts
out, decreasing the world relative price of manufactured goods and deteriorating Japan’s terms of
trade.
b. Korea’s increased automobile production increases the supply of manufactures, which increases
the world RS. The world relative supply curve shifts out, decreasing the world relative price of
manufactured goods and deteriorating Japan’s terms of trade.
c. U.S. development of a substitute for fossil fuel decreases the demand for raw materials. This
increases world RD, and the world relative demand curve shifts out, increasing the world relative
price of manufactured goods and improving Japan’s terms of trade. This occurs even if no fusion
reactors are installed in Japan since world demand for raw materials falls.
d. A harvest failure in Russia decreases the supply of raw materials, which increases the world RS.
The world relative supply curve shifts out. Also, Russia’s demand for manufactures decreases,
which reduces world demand so that the world relative demand curve shifts in. These forces
decrease the world relative price of manufactured goods and deteriorate Japan’s terms of trade.
e. A reduction in Japan’s tariff on raw materials will raise its internal relative price of manufactures
(pM/pR). This price change will increase Japan’s RS and decrease Japan’s RD, which increases the
world RS and decreases the world RD (i.e., world RS shifts out and world RD shifts in). The world
relative price of manufactures declines and Japan’s terms of trade deteriorate.

6. The declining price of services relative to manufactured goods shifts the isovalue line clockwise so
that relatively fewer services and more manufactured goods are produced in the United States, thus
reducing U.S. welfare.

© 2012 Pearson Education, Inc. Publishing as Addison-Wesley

28 Krugman/Obstfeld/Melitz • International Economics: Theory & Policy, Ninth Edition

7. These results acknowledge the biased growth which occurs when there is an increase in one factor of
production. An increase in the capital stock of either country favors production of good X, while an
increase in the labor supply favors production of good Y. Also, recognize the Heckscher-Ohlin result
that an economy will export that good which uses intensively the factor which that economy has in
relative abundance. Country A exports good X to country B and imports good Y from country B.
The possibility of immiserizing growth makes the welfare effects of a terms of trade improvement
due to export-biased growth ambiguous. Import-biased growth unambiguously improves welfare for
the growing country.
a. The relative price of good X falls, causing country A’s terms of trade to worsen. A’s welfare may
increase or, less likely, decrease, and B’s welfare increases.
b. The relative price of good Y rises, causing A’s terms of trade to improve. A’s welfare increases
and B’s welfare decreases.
c. The relative price of good X falls, causing country B’s terms of trade to improve. B’s welfare
increases and A’s welfare decreases (they earn less for the same quantity of exports).
d. The relative price of good X rises, causing country B’s terms of trade to worsen. B’s welfare may
increase or, less likely, decrease, and A’s welfare increases.

8. Immiserizing growth occurs when the welfare deteriorating effects of a worsening in an economy’s
terms of trade swamp the welfare improving effects of growth. For this to occur, an economy must
undergo very biased growth, and the economy must be a large enough actor in the world economy
such that its actions spill over to adversely alter the terms of trade to a large degree. This combination
of events is unlikely to occur in practice.

9. India opening should be good for the United States if it reduces the relative price of goods that
China sends to the United States and hence increases the relative price of goods that the United States
exports. Obviously, any sector in the United States hurt by trade with China would be hurt again by
India, but on net, the United States wins. Note that here we are making different assumptions about
what India produces and what is tradable than we are in Question #6. Here we are assuming India
exports products that the United States currently imports and China currently exports. China will lose
by having the relative price of its export good driven down by the increased production in India.

10. What matters for welfare are the external terms of trade. Suppose that country X exports good A and
imports good B, while country Y exports good B and imports good A. The export subsidy in country
X will raise the internal price of the export good A, leading to an increase in production of good A
and decrease demand of good A. As a result, the world price of the good A falls. The tariff on good A
in country Y will increase production and decrease demand for good A in country Y, leading to a
reduction in the world price of good A relative to good B. Thus, the terms of trade in country X falls
and the terms of trade in country Y rise. Country X is worse off, while country Y is better off.

If instead country Y had imposed an export subsidy on good B, then the internal price of good B
would rise. Production of good B rises and demand for good B falls. As a result, the world price of
good B falls. The net effect on welfare is ambiguous and depends on the relative declines in the world
prices of goods A and B.

© 2012 Pearson Education, Inc. Publishing as Addison-Wesley

 Chapter 6 The Standard Trade Model 29

11. International borrowing and lending implies a trade-off between the production of current and future
consumption much like trade in goods implies a trade-off between production of different goods.
The more current consumption you select the less future consumption you will be able to engage
in. International borrowing and lending is driven by differences between countries in intertemporal
preferences much like international trade is driven by differences between countries in technology or
factor endowments. Countries with a relative preference for current consumption will “export” current
consumption in exchange for future consumption. In other words, these countries will borrow in the
current period from countries that have a relative preference for future consumption. Much like
international trade, the relative amount of current consumption that is traded for future consumption
is determined by the relative price of future consumption, defined as 1/(1 + r), where r is the real
interest rate.

12. Comparative advantage in international borrowing and lending is driven by the relative price of future
consumption, and more specifically, the real interest rate. As the real interest rate rises, the relative price
of future consumption 1/(1 + r) falls. Effectively, a country with a high real interest rate is one that has
high returns on investment. Such a country will prefer to borrow today and take advantage of the high
return on investment and enjoy the fruits of current investment with high returns in the future.
a. Countries like Argentina and Canada should have high real interest rates as there are large
investment opportunities that have yet to be exploited. These countries will have a low price of
future consumption and will be biased toward future consumption, preferring to borrow today.
b. Countries like the United Kingdom in the 19th century or the United States today will have
relatively lower real interest rates as they already have a high level of capital and limited returns
on new investments. As a result, the relative price of future consumption is high and they will be
biased toward present consumption.

© 2012 Pearson Education, Inc. Publishing as Addison-Wesley

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 9th.—This morning Musa was very feverish, so the men asked me
to stop a day to collect provisions. To this I unwillingly assented, but
they did little else than lie down. About nine a.m. five of the men
proposed that I should allow them to leave their muskets and all their
baggage, and push on as fast as possible to the boats, while I
moved on quietly with the sick and sore-footed. I consented, on the
condition that they would stay at the boats no longer than would be
necessary to cook a meal; that then they were to return laden with
provisions. To this they agreed, and then left us. The two who stayed
behind the day before yesterday came up with us; it was for them I
was anxious. During the ascent of the steep mountain on the 8th the
last remnant of my shoes was carried away, and yesterday I
attempted to protect my feet by fastening some goats’ skin over
them in the form of moccassins. To-day I am trying to improve them,
but with very little success.
10th.—Musa having shaken off his fever, was enabled to start; but
all the men are weak, and many are ailing. Though perfectly well in
health, I find that, having only had for yesterday’s dinner a glass of
rice-water with the palm-cabbage, I am not fit for very long walks,
particularly as my moccassins are cut to pieces by the rough stones
and thorns, and I am compelled to walk bare-footed. My greatest
torment are the leeches getting between my toes and crawling up my
trousers, reaching even to my waist, where the tight belt prevented
their farther progress. Squeezing a little tobacco-juice made them
drop off, but I could not be continually stopping to do this.
11th.—We stopped all day. The industrious cut down some Loba-
palms, and made a little sago; the lazy collected a few cabbages. I
tried a little of the former; it was indeed delicious.
Some of the men, who wandered farther than the others in search
of wild fruits, reported seeing some very large monkeys, which they
said might be orang-utans, and whilst speaking of them I was
reminded of the various stories told of people being carried off by
them. I have referred to this subject in my account of my journeys
among the Sea Dayaks, but although many stories are related of the
male orang-utan carrying off young Dayak maidens into the jungle,
yet it is seldom that we hear of the female orang-utan running off
with a man. But the Muruts of Padas tell the following narrative,
which, they say, may be believed. Some years ago, one of their
young men was wandering in the jungle, armed with a sumpitan, or
blow-pipe, and a sword. He came to the banks of a pebbly stream,
and being a hot day, he thought he would have a bathe. He placed
his arms and clothes at the foot of a tree, and then went into the
water. After a time, being sufficiently refreshed, he was returning to
dress, when he perceived an enormous female orang-utan standing
between him and the tree. She advanced towards him, as he stood
paralyzed by surprise, and seizing him by the arm, compelled him to
follow her to a branching tree and climb up it. When he reached her
resting-place, consisting of boughs and branches woven into a
comfortable nest, she made him enter. There he remained some
months jealously watched by his strange companion, fed by her on
fruits and the cabbage of the palm, and rarely permitted to touch the
earth with his feet, but compelled to move from tree to tree. This life
continued some time, till the female orang-utan becoming less
watchful permitted the Murut more liberty. He availed himself of it to
slip down the trunk of the tree and run to the place where he had
formerly left his weapons. She, seeing his attempted escape,
followed, to be pierced, as she approached him, by a poisoned
arrow. I was told if I would ascend the Padas river as far as the
man’s village, I might hear the story from his own lips, as he was still
alive.
12th.—Walked on a mile, the men excessively lazy. Finding the
river smooth, they proposed trying rafts; so we stopped to construct
them. One of the men, observing that I was dining on a cabbage-
palm boiled in a little rice-water, presented me with a cup full of
uncooked rice. I was very grateful to him for it; but we put it by, in
case the palms should fail us, as they do in some districts.
13th.—About nine, we pushed off, and got on very well for two
hours. Found one of the rafts smashed up against a rock, and the
men away walking. Continued till about one o’clock, when ours also
became fixed on a rock, and our men were too dispirited to get it off;
and saying that the rapids ahead of us were dangerous, they
proposed walking to-morrow. We should have thought nothing of
such paltry difficulties a week ago, but the men were losing their
courage with their strength. I refused, however, to stop till to-morrow,
and walked on for a couple of hours. In crossing a ravine to-day, we
disturbed a female bear, which, however, dashed with her cubs into
thick brushwood, so without dogs it was useless following her. She
roared in a manner worthy of an animal double her size.
14th.—The river still full of rapids; but the hills are gradually
receding from the banks, giving it more space, and it sometimes
spreads out into extensive sheets of water, with immense pebbly
flats. Islands are also beginning to appear. It was again proposed to
build rafts, but I steadily refused, and kept walking till nearly five.
After sunset, the last stragglers overtook us. We continually came
upon the traces of the advance-party. At one of their resting-places,
we found the bones of a fine fish, which by some means they had
secured. Our old Pakatan declared they had either found it stranded,
or else had startled a kite from his prey. It proved to be the former,
though the latter had happened to us once.
15th.—Yesterday and to-day the character of the forest has
altered. We are now marching through the old farming grounds of
the Muruts; found some of their fruit trees; among others, one
covered with fine-looking oranges, but intolerably sour. I secured the
opium bottle to-day, intending to take a dose to deaden the pangs of
hunger, but I put it off till the evening, thinking it might interfere with
my walking. I noticed near the orange-tree above mentioned that the
whole ground was a mass of water-worn pebbles, evidently the
ancient bed of the stream; it was now at least a hundred feet above
the water’s edge.
At half-past four p.m. I brought up for the night, and after bathing
stretched myself on my back, munching a great lump of cabbage,
when my eyes, wandering over the scene, fell on a hill about three
miles ahead of us. I sat up and looked at it again; and, turning to my
companions, said, “Why, that reminds me of the high land near the
mouth of the Madihit;” but we agreed that it was impossible, as our
five men had been gone six days, and we felt assured that we
should have met them ere this if we were so near our boats as that,
particularly as we, both yesterday and to-day, had made very long
walks. Since we have had a bearing of Molu, we have been keeping
generally in a west course, but the river has taken some very
extraordinary windings.
Having secured some fruit of the Jintawan, or Indian-rubber plant,
and some cabbages, I was enabled to satisfy my hunger before
going to sleep, so put off taking any laudanum, to which I had a very
great dislike. The Jintawan fruit is very pleasantly acid, about the
size of a very large pear, and of a deep orange colour. It consists of
a thick rind full of Indian-rubber, surrounding some pulp-covered
seeds. One of the plants we came across was very handsome,
growing in the most luxuriant manner over a lofty tree with few
branches. The Jintawan is a creeper, and this one had extended
itself at least forty feet up the trunk and had covered the
outspreading boughs. It was loaded with fruit, but my men had so
lost heart that not one would climb the tree, but contented
themselves with picking up the over-ripe produce which had fallen on
the ground below. We had another very happy find to-day, for while
passing under a fine tapang-tree, we noticed the remains of a bees’
nest scattered about, and every particle was eagerly appropriated.
From the marks around it appeared as if a bear had climbed this lofty
tree and torn down the nest to be devoured by its young below, as
there were numerous tracks of the smaller animals around, but
whether the comb had been sucked by the bears or not was very
immaterial to our men, who rejoiced in securing the little honey still
clinging to it.
16th.—Started early. About half my followers had so delayed us
by their constantly lagging behind, that I determined to wait for them
no longer, but to push on with such men as would follow me with all
their strength. We felt that it would be impossible to walk many days
farther on our scanty fare. The lazy ones having heard of our
arrangement, tried to keep up with us, and did do so till eight, when I
heard a shout from the foremost man, “Bandera! bandera!—the flag!
the flag!” We rushed down the side of the hill like madmen, the
fellows shouting for joy. Sure enough, there was the British flag
hoisted, and our small boats at the mouth of the Madihit, with our five
men looking fat and well beside my pale and famished followers. The
rascals having left my guns and all the baggage in the jungle, and all
being in good health, had managed to reach the Madihit in three
days, and then set to work to eat and drink as much as possible.
We arrived to find the provisions nearly gone; they said the bears
had found out our cache and destroyed everything, and the only
provisions left were those we put into the garei. I could only divide a
cupful of beans to each man, as the five had managed to consume
thirty pounds of sago and forty-two pints of beans in the course of
four days, and they confessed to have daily caught very fine fish. But
what angered the men most was the signs of waste around, where,
having only half finished a plate of sago, they had thrown the rest
away. I saw some picking up the burnt pieces that had not been
washed away by the rain. I asked why, according to their agreement,
they had not come back to meet us, knowing that we had several
sick men. They put the blame on each other: one man, a Javanese,
had left his sick son with us, but he unfeelingly observed that he was
old enough to look after himself; that son had given us more trouble
than any one else, both in going and returning.
I searched their baskets, and found that they had not only hidden
some more beans, but had stolen some of my cloth, though I could
not fix on the man. I determined to punish them, so told them to go
back and fetch the things they had left in the forest; or, on my return,
I would submit the case to the Sultan, whether they had not forfeited
wages by their unfair abandonment of their sickly companions. They
started off, but their cowardly hearts failed them, and before night
they came back.
The ravages of the bears were distressing. They destroyed a
Deane’s pistol-case, tore open my box of books, and ruined them;
reduced the cloth to shreds, and tumbled it into the mud, where the
white ants afterwards finished the spoiling; opened the tin boxes
containing the sugar and biscuits, and of course devoured them; so
that I have nothing left but coffee and arrack. After Musa had cooked
a meal, a very frugal one, he went off with a party to fetch the garei,
hoping to find a little sago left, but was disappointed.
 In the evening caught a few fish, but they were not much among
so many. About seven, a most satisfactory savour rose to my
nostrils. I found that Ahtan, having discovered a jar of pork fat, was
preparing some cakes. I divided them, but he said, “No; you, sir,
have the larger body, therefore should have the larger share.” I am
not much given to emotions, but I never felt so thankful as when,
stretched in the old Kayan hut, I watched them preparing an evening
meal, and thought of all the dangers we had gone through without a
single accident. True, we had lost guns, and goods, and ruined
instruments of some value; but what of that?—there was no one the
worse for his exertions. What was hunger now we were so near
home?
17th.—Started early; and, as we have had no rain for two days,
the river was quiet, and we only reached an island about fifteen
miles from the Madalam. It shows the difference, however, between
ascending and descending a river. About two a.m., our garei being
well ahead, we saw before us a herd of wild cattle, quietly picking at
a few blades of grass on a broad pebbly flat. I landed with a couple
of men, to get between them and the jungle. I was within twenty
yards of the nearest, a piebald, and was crawling through the
tangled bushes to get a sight of him, whom I could hear browsing
near me, when there arose a shout, then a rush, and the cattle were
off dashing close to me, but perfectly concealed by the matted
brushwood. It was the crew of one of the newly-arrived boats that,
regardless of the warnings of their companions, had thus lost us a
chance of a good dinner. I felt that, if my gun had been charged with
shot, I could almost have peppered them. Shortly after I shot a pig
through the back as he was crossing the river; but as all my men
were Mahomedans, it was not worth while tracing him in the jungle.
He bled so profusely in the water that he could not have run far.
About five, we were passing down a rapid at a great pace, when
one of the men touched me and pointed. I looked up, and there was
a magnificent bull, three parts grown, standing within fifteen yards of
me. To put up my gun and let fly was the work of a moment; but,
before we had dashed on many yards, the beast, which had fallen on
his forehead, was up and away. After a little time, we managed to
stop the garei; and, landing, found traces of the beast’s blood. My
feet were so painfully wounded that I could not manage to follow it,
but left it to my men. A couple came up with him, as he stood with
his legs well stretched out, bleeding profusely. He took no notice of
them, even when they were within spearing distance; but all their
nerve was gone, and they were afraid to thrust their weapons into
him. They waited till the whole mob of hunters arrived, when the bull
apparently recovering himself, dashed away into the jungle.
Having secured the boats under the islands, I divided a
tablespoonful of beans each, with a little pork fat to those who would
take it. Musa told me that most of the men wanted to stay behind
and follow the wounded Tambadau; but that, if I wished to go on,
there were five volunteers who would pull straight to Brunei, now
about a hundred miles off by river. To this I agreed.
18th.—I get away at daylight in a sampir with five men. Ahtan with
an attack of fever and ague. The reaction was too much for him, so I
stopped at an island about five miles from the Madalam to cook. I
now produced my secret store of beans, and the cupful of rice that I
had treasured up since it was given us on the 12th. The beans I
gave to the men, and the rice I had boiled into a thin sort of gruel for
Ahtan. I thought his feverish symptoms arose principally from over
fatigue and hunger. In fact, after he had swallowed a strong dose of
quinine, and taken half the gruel, he felt much better; the rest of it I
gave to the men, as I wanted to give them sufficient strength to pull
to Pengkalan Jawa. I would not take anything myself, as I did
nothing but sit all day. I reserved my powers for the food I knew the
Chinese trader there would quickly prepare for us.
As we approached the more frequented parts of the river, we met
some Muruts, who told us that the report of my death had brought
forty steamers to the capital to revenge it, and that if I did not turn up
the place was to be burnt. I knew this was one of the usual stories
that arise from very little, but still I was anxious to get home; but with
all our exertions we did not reach the Chinese trader’s house till 7
p.m. He received us most hospitably, produced tea, sugar-candy,
biscuit, and dried fish, to stay our appetites, while a proper meal was
prepared. In about an hour this appeared, and we managed to
consume a very large fowl each, with an amount of rice that even
startled the Baba. Before leaving at midnight, I made arrangements
that a plentiful meal should be provided for the garei’s crew.
19th.—After pulling about fourteen hours, we reached Brunei by 2
p.m., to find the people beginning to wonder at our absence. The
forty steamers proved to be Captain Cresswell, of the Surprise, who
had visited the capital about ten days before with Mr. Low. The latter
was beginning to be uneasy about my absence, and was preparing a
party to come and search for me.
20th.—My boats now arrived, having failed to get the Tambadau.
They said they followed him by the blood till mid-day, when they lost
his traces among those of a herd which he had joined. I suspect they
did not follow him very far.
Thus ends my journal.
As I have now made many journeys in Borneo, and seen much of
forest walking, I think I can speak of it with something like certainty. I
have ever found, in recording progress, that we can seldom allow
more than a mile an hour under ordinary circumstances. Sometimes,
when extremely difficult or winding, we do not make half a mile an
hour. On certain occasions, when very hard pressed, I have seen the
men manage a mile and a half; but, with all our exertions, I have
never yet recorded more than ten miles progress in a day through
thick pathless forests, and that was after ten hours of hard work. Of
course we actually walk more than we record, as one cannot
calculate the slight windings of the way; but allowing for all this, I
have the strongest suspicion that Madame Pfeiffer measured her
miles by her fatigue. She talks of twenty miles a day as a common
performance of hers; and another visitor to this island beats her,
recording walking thirty miles in one day through Bornean forests—
an utter impossibility.
There was an Adang man among the wax-hunters, the one who
accompanied our guide for a short distance, who was pointed out to
me as a model of activity, and he certainly appeared so; well built,
strong, but light, he skimmed the ground; and the story is told of him,
that on receiving information of the illness of his child, he started
home, leaving everything behind him but his spear and a little food,
and walked from forty to forty-five miles in two days. No European
that I have ever seen would have had a chance with him in his own
forests.
Six miles a day is quite enough for any man who wishes to take
his followers long journeys, unless specially favoured by the ground
and the paths; Galton, in speaking of African travelling, says three
miles a day with waggons, horses, and cattle, and he is of some
authority. I have often thought that we must have walked twenty
miles, but the bearings have always proved to me that we have
seldom done half that distance. It requires great experience not to
judge distance by the fatigue we feel.
Whilst referring to the mistakes in the estimates of distance, I may
notice the very remarkable errors into which two visitors to the
Limbang have fallen. Mr. Motley[9] mentions exploring that stream to
an estimated distance of one hundred and fifty miles, by the
windings of the river, and about fifty in a general south-west
direction. He reached the Limbuak village, which by my
measurement is under twenty miles in a straight line from the mouth:
fifty miles in a direct line to the south-west, would have nearly
brought him to the Baram, across numerous ranges of hills, and
several navigable streams, and a hundred and fifty miles up the river
would have brought him nearly to the farthest point I reached, long
past the limestone districts. It proves how impossible it is to trust to
estimates.
The next curious mistake I may notice, was made by Mr. de
Crespigny; he ascended the river Limbang as far as the river Damit. I
have seen a sketch map of his, and he places the mouth of that
stream in north latitude, 3° 48’, and the mountain of Molu to the
north-east of it, in latitude 4° 3’, whereas Molu Peak is a little to the
westward of south from the Damit, and nearly twenty-five miles
distant in a direct line.
In drawing attention to these errors, I by no means claim immunity
from them in the map of the Limbang and Baram rivers which
accompanies this volume; but I think they will be found free from
gross errors. The course of the latter river was taken down by
Captain Brett of the Pluto, and observations of the latitude and
longitude of the town of Lañgusan were made by many of the
officers on board. In my land journeys, I had very inferior
compasses, as I was unable to take with me the valuable levels and
other instruments obligingly lent me by Dr. Coulthard, on account of
their weight and size; but I used them as long as I was in my boats,
to lay down the position of the mountains; and in order to enable me
to correct my own errors, I put down the day’s observations on a
rough map every evening during the journey, except after we had
shot the cascade and wetted the paper too much to permit it being
handled roughly.
I may add, that of the whole party of nineteen, none after our
return suffered severely from the exposure and privations we had
undergone, and I believe the real reason was, that we always were
dry at night. For many years we trusted during our expeditions to the
leaf huts the natives are accustomed to construct for us and for
themselves; but although with sufficient time, and when good
materials are plentiful, they manage to make them tolerably
watertight, yet they are never so good as the simple tents we always
took with us during our later expeditions. With proper ropes and
everything fitted to enable us to raise these tents on cross poles in
ten minutes, the two did not weigh more than twenty pounds, and
afforded comfortable accommodation for our whole party of nineteen
people, with all our baggage, and on occasions our six guides took
advantage of them also.
I had suffered severely from exposure on former expeditions,
particularly when we ascended the Sakarang, and were eight days
sleeping in the leaf huts hastily erected by our followers. Of the
seven Englishmen who slept on shore, I believe only one escaped
without some severe attack of illness, and I remember the late Mr.
Brereton mentioning that on his return from a visit to the Bugan
country, where his men had been greatly exposed, a fourth of his
party died of various diseases. Another precaution I took was to
carry myself a few night things, as a light silk jacket, a pair of loose
sleeping drawers of the same material, a jersey, and a dry towel, so
that if my men lagged far behind, I was not kept for hours in my wet
clothes; and whilst travelling in these forests you are always wet, as
if there be no rain there are sure to be many rivers to ford.
On my return, I tried to remember the geographical information
that was given me before starting. I was told it would take six days
from Blimbing to Madihit: leaving out the two days’ detention from
freshes, it took us about three hours over the six days. Even the
walking distance was really correct; it was only two days from the
Adang landing-place, and seven from Madihit; as, although we took
ten, yet for the first five days we did not do a fair half-day’s work on
any of them. We were warned that it would be impossible to use
rafts, and that the banks were almost impassable, and we indeed
found it so.
Many months before starting, I was told that if I wished to
penetrate far into the interior, to try the Trusan, and not the Limbang,
as the former was inhabited, the latter not. I went up the Trusan a
few miles, but found it so small, I had no idea it penetrated to so
great a distance. The fact is, that the rains run off very fast, and that
the ordinary states of the rivers give no idea of the amount of water
they bring down, but had we taken that route, we should have
reached our farthest point with comparatively little fatigue.
The Orang Kaya Upit arrived at his house November 13th, twenty-
five days after I reached Brunei; so that it is fortunate I did not wait
for him. I may add, that on November 20th, some Bisaya chiefs set
upon pañgeran Makota, the shabandar, and killed him. They were
wearied with his exactions. The immediate cause of his death was
seizing the daughters of seven Orang Kayas, one of whom he had in
his curtains when attacked, and this caused his death. The girl
pointed him out to her father, trying to escape in a small canoe. The
alarm was given, and his boat tilting over while he tried to avoid the
shower of spears and stones, he fell into the stream and was
drowned; for he was the only Malay I ever heard of who could not
swim. Such was the end of this clever bad man. The Sultan was
furious, but his fury was not shared by his four viziers; so that the
affair ended by a dozen lives being taken, instead of the hundreds
the Sultan desired.
 Brunei, February 8th, 1861.—Above two years have passed since
I wrote this journal. The scheme of building a fort at the Madalam
mouth did not succeed, as the Sultan, after the shabandar’s death,
was very unwilling to assist any of the aborigines. I was away during
the year 1860, and in the course of that time, a party of the Muruts,
from the upper Trusan, came over and encamped at the mouth of
the Salindong stream, and from thence sent on three men in a bark
canoe to tell their friends of their presence. These men met the
Orang Kaya Gomba, a Bisayan, at Batang Parak, and were
treacherously slain by him. The Muruts waited a long time at
Salindong, hoping to be fetched away by their friends. They could
not walk the whole distance, as they had their women and children
and all their worldly goods with them, intending to remove to the
lower Limbang, and live with the Orang Kaya Upit.
While thus detained, they were surprised by a large party of
Kayans, and every one taken or slain. However, one of the prisoners
afterwards managed to get away, and reached his friends, bringing
this sad tale. The Orang Kaya Gomba declares that he mistook the
three for Kayans, which is almost impossible, as no head-hunter
would have been found paddling down a hostile stream in a bark
canoe. Neither the Sultan nor any of the viziers will make the least
inquiry into this affair, but the memory of it is treasured up in the
hearts of the Muruts, and Orang Kaya Gomba may yet meet with a
bloody death.
I have remarked that during all our wanderings near Kina Balu we
only at one place found the dried heads of enemies hung up in the
villages there, and during my journeys up the Limbang, I do not
remember noticing any, and yet Orang Kaya Gomba’s murderous
action shows they do value them, which is confirmed by pañgeran
mumin making a present of the head of the man he killed to the
Gadang Muruts; and during my stay in Brunei, I have met small
parties of head-hunters, but seeking only the heads of their real
enemies. Yet I have always avoided spending a night in their
immediate neighbourhood, and have kept our arms ready for instant
service.
One evening, during a heavy squall, we took shelter in a little river
to the south of Point Kitam, in the Limbang Bay, and to our
exceeding discomfort found a Murut boat with eighteen armed men
in ambush round a short turn of the stream; we knew they were not
waiting for us, but having only four men, and a couple of fowling-
pieces, we did not feel secure in their neighbourhood. As we rowed
past them they took no notice of us, but no sooner had we anchored,
than they pulled off towards our boat; but we should have felt little
discomfort, had they not had their mat coverings stowed away, while
all the Muruts had their arms ready for action. I told my men to show
no sign of alarm, but keeping our guns within reach, waited their
coming.
It was a great relief to find that they only came to ask for a little
tobacco, but some of us had been accustomed to the neighbourhood
of the Seribas and Sakarang Dayaks, who on head-hunting
expeditions spare none, if of a weaker party. We found they were on
the look-out for some of the Tabuns, who, flying before the Kayans,
had established themselves at Batu Miris, near the entrance of the
Limbang river, and with whom they had an ancient feud. To show the
apathy of the Bornean Government, I may mention that it permitted
these skirmishes to take place close to the capital, and one day
some of my men who were cutting wood near the Consulate, were
startled by seeing two Tabuns rushing frantically past them; in a few
minutes five Trusan Muruts appeared in full chase, and eagerly
inquiring the direction taken by the fugitives, hurried at full speed on
a false track purposely pointed out by my Manilla men.
Another fact I may mention is that many Bisaya labourers who go
over to our colony of Labuan to seek for work have actually
attempted to disinter the bodies of those of our countrymen and
women who have been buried there. They have tried this to the great
grief and discomfort of their surviving friends, but the Bisayas have
generally, if not always, been disappointed by the great depth of the
graves, and their inefficient tools. It appears a disgusting thing that
there should be any necessity to watch over the graves of one’s
friends to prevent them being desecrated.
I shall have occasion hereafter to mention the Secret Societies
established by the Chinese, but as an illustration of the influence the
members exercise over each other, I will tell the following story:—
Perhaps those who have read my journeys to Kina Balu, and this
Limbang journal, may be interested in the fate of my boy Ahtan, and
I am sorry to say his conduct ultimately made me lose all interest in
him. In the year 1858 the Chinese in Brunei started a Secret Society,
called there a Hué; they said they were a branch of the Tienti, or
Heaven and Earth Society, that has ramifications in nearly all the
countries in which the Chinese have spread. At first but few joined it,
but by threats and cajolery they at last induced nearly all but the
head traders to enter it, and on one of the great Chinese religious
feasts, Ahtan asked my permission to go to it.
When he returned, it appeared to me he had a very hang-dog
look, and next day I noticed he was very busy about my medicine-
chest, and I found my laudanum bottle on the table. Being very much
engaged at the time preparing my letters for the mail, I took no
particular notice of his movements, but immediately after dinner,
having taken coffee, I felt drowsy, and had scarcely entered my
mosquito room, when I fell on the sofa, and remained in a stupefied
sleep for thirteen hours. On my recovery, Ahtan came with a scared
look, and said somebody had stolen my heavy iron chest, and it
proved to be the case, but as I had six dogs, one of whom was a
savage mastiff, my suspicions instantly fell upon my own people, and
passing over my household servants, I fixed on my boatmen as the
culprits.
The Sultan, however, sent and begged I would leave the matter in
his hands, and on my expressing my willingness, instantly arrested
two of my servants, Ahtan and a Manilla Christian named Peter.
They were separated, and at dead of night the Sultan went himself
with a drawn kris in his hand to the latter, and said if he would
confess he would save his life, but if not——; he did not finish the
sentence, as Peter instantly fell on his knees, and clinging to the
Sultan’s feet, begged that his life might be spared and he would
explain all. It appeared that while he held and quieted the mastiff,
Ahtan had taken a blacksmith and a carpenter to the chest, and they
had carried it off. As these men were constantly employed by me, it
explained the silence of the other dogs; but though he could tell how
the chest was carried off, he knew nothing of what had since
become of it. The Sultan then left him and went to Ahtan, but no
threats or entreaties had the slightest effect on him, as he had sworn
in the most solemn manner to be faithful to the members of the Tienti
Hué, and would confess nothing. The two accused were seized, and
as they also belonged to the Secret Society, suspicion was directed
to it. I sent for the chief and the other officers of the Hué, and told
them the whole story, and said, if the chest unbroken, with the 80l. in
it, and all the papers, were not placed on the ground before my
house within forty-eight hours, I would turn the Sultan’s attention on
them. They protested their utter ignorance of the robbery, which was
probably true, but they well knew how to influence all their members,
and before the forty-eight hours were over, the chest, untouched,
was thrown on the mud just above my house. Finding after a
fortnight that the prisoners were receiving treatment totally at
variance with English ideas of justice, I sent and begged the Sultan
to pardon them, and turn his attention to getting rid of the Secret
Society from his dominions. He complied, and it merely required a
warm recommendation on his part to the chief officers to break up
the society, to induce them to do it, as he declared that every
robbery in future should be laid at their door, and every crime
committed should be avenged on them. As the officers were men
doing a good business at the time, they quickly got rid of their
banners and meeting house, and I heard no more of the Hué during
the rest of the time I remained in Borneo, but during my last visit I
found the chief officers of the society reduced to comparative
poverty, as their partners and agents in Singapore, happening to be
real British subjects, had refused to have anything further to do with
them when they knew of their conduct.
I requested the Sultan to let the prisoners go, as all except Ahtan
were kept in the stocks in an open verandah, exposed to sun and
rain, and tormented the whole day by boat boys, who delighted in
torturing those whom they considered as infidels: in Brunei they have
no prisons whatever. Ahtan was better treated, as he was known to
have been a favourite servant, though his conduct was very bad,
particularly in dosing me with opium, yet I could not forget his
kindness to me during our wanderings in the interior, and asked for
his liberty on that plea. The Sultan’s answer was,—“The plea is
good, but the stubbornness of that boy in refusing to confess when
all the others had acknowledged their crime, deserves death.” I
heard a few months ago that he was keeping a small shop in
Labuan.
A man in whom I felt a very great interest, and was very sorry to
part with, was Musa, my Manilla steersman and coxswain; as a boy
he had been educated as a Christian, but having been captured very
young and sold by the Balignini pirates to the Mahomedans, he had
been circumcised, and joined their communion. He had a particular
antipathy to Signor Cuarteron, who returned the dislike, and used
gravely to assure me that my quiet, respectful follower had a design
to massacre him. When the priests first came to Brunei, all my
Manilla men attended mass, but were suddenly disgusted with
something which took place; and on my inquiring the cause, one of
them said, “We don’t like to be told that if we don’t again join the
Padre’s religion, he will send for a Spanish man-of-war to take us all
off prisoners to Manilla.” If he really did threaten them, he made a
great mistake, as some of them never went near the church again.
Musa, though modest and gentle in his manner, was as brave as a
lion, and would have followed me anywhere. Though very short, he
was squarely built, and exceedingly strong; a very powerful
swimmer, and good boatman. Many of these men excite a personal
regard, and I have always felt that for Inchi Mahomed, my Malay
writer, who was entrusted with the charge of the Consulate during
my lengthened absences, and he well deserved the trust.
 CHAPTER VIII.
THE SULU ARCHIPELAGO.

FIRST VISIT.

Picturesque Islands—Balambañgan—An old English Settlement—

Large Monkeys—Optical Illusions—Flights of Birds—The Curlew
—The way we shot them in Sarawak—Game—Banguey—Mali
Wali—Cleared Hills—Fine Water—Sweet-smelling Jasmine—
Cagayan Sulu—Intercourse with the Inhabitants—Appearance of
the Country—Lovely Scenery—Market—Inhabitants—Insolent
Traders—The Crater Harbour—Wall of Evergreen—Inner Lake—
Climb the Cliff—Scenery—Alligators numerous—Sulu—
Appearance from the Ship—Sugh, the Capital—Mr. Wyndham—
The Watering-place—Suspicious Natives—Fugitives from
Balignini—Reports—A Market—The Mountaineers civil—Walk to
the Palace—The Stockades—Armed Crowd—Audience Hall—
Absurd Reports—The Sultan and his Nobles—Dress—Politeness
of the Sultan—Return to the Ship—Datu Daniel—The
Racecourse—Effect of Dutch Shot—Tulyan Bay—Alarm of
Villagers—Sulu Government—Laws—Feuds—The Mahomedan
and the Pork—Population—Fighting-men—Slave Market—
Dignified carriage of the Nobles—Dress—The Balignini—Dutch
Attack—Appearance of the Country—Good Position of Island—
Tulyan—Basilan—Numerous Islets—Samboañgan—Spanish
Convict Settlement—Description of Country—Fort—Town—
Shops—The Church—The Men—The Women—The Corner Shop
—A Ball—Dancing difficult—Waltzes—Supplies at Samboañgan
—A lonely Grave.
During all the voyages I have made, I have never beheld islands
so picturesque as those scattered over the surface of the Sulu Seas,
or whose inhabitants more merited notice. I will therefore give a short
account of the visits I made thither, before the attacks of the Spanish
forces had altered the ancient state of affairs. I have already
delineated the north-west coast, and will therefore commence my
description from the island of Balambañgan, to the north of Maludu
Bay, which must always be of some interest to Englishmen from our
two unsuccessful attempts to form a settlement there.
We dropped anchor off Balambañgan, which at night appears a
low wooded island. I visited it in the morning in a cutter, and vainly
sought any fresh traces of human beings, though we found some old
deserted huts of the fishermen who frequent this shore for tripang.
Continuing our explorations, we noticed something moving along the
beach, and there were various conjectures among our party, some
affirming it to be a buffalo, others a man; I never was more deceived
in my own estimate of the size of an animal, as it proved to be a
large monkey, which with its companions was seeking shell-fish on
the sands; it was certainly very large, but not of such dimensions as
to warrant its being compared to a bull, but there appeared to be
some optical illusion caused by its looming over the water.
Pursuing our path along the beach, the seamen at last thought
they saw houses among the trees, but on landing we found we were
again deceived by a row of white rocks, prettily overhung with
creepers. Though no traces of inhabitants were to be found, yet
animal life was well represented, innumerable monkeys swarmed at
the edge of the jungle, while flights of birds of every kind kept rising
before us. I never saw more monstrous pelicans, but after having
been so deceived by the monkeys, I must not attempt to estimate
their height. The best birds, however, for culinary purposes, were the
curlews, some of which are as large as small fowls: unfortunately we
were not provided with shot, and ball fell harmlessly among them.
They are wary birds, but may yet be readily circumvented. There
is a spot at the entrance of one of the minor branches of the
Sarawak river, where the curlews congregate in thousands, but only
at the height of spring-tides can you get profitable shots at them.
There are broad sands there, and the birds spread over them to
feed; by degrees the rising waters gradually press them back
towards the wooded shore; and as beach after beach is covered,
they fly screaming above in wide circles, gradually narrowing till they
all settle on the spot near which the sportsmen lie concealed, either
behind scattered bushes, or in a prepared bower of leafy branches.
The evening has well closed in before the tip-top of high-water; and
the loud scream of the myriads of birds deadens the detonation of
the guns as they send their iron shower among them, enabling us to
load and reload without completely scaring the birds. We once
obtained ninety-five of the largest kind, and hundreds of smaller
ones, to feast the crowd who were assembled near preparatory to a
great tuba-fishing.
Balambañgan is admirably situated to command the China seas;
however, if its position be superior to Labuan, the latter has coal to
counterbalance that advantage. While strolling along the beach we
came upon the tracks of cattle, deer, and pigs, and another party
from the ship had the good fortune to secure a large supply of
excellent fish with the seine. This island, as well as the neighbouring
coast of the mainland, appears to swarm with game; I landed on the
latter, and found an extensive open plain, diversified with a few low
eminences, backed by some cleared hills, and there the tracks of
wild cattle, deer, and pigs were innumerable. The rhinoceros is also
reported to be occasionally seen, but we came across no traces of it.
Continuing our voyage, we passed the island of Banguey, in the
northern part of which there are fine peaked hills, with inhabitants,
and plenty of good water, therefore far preferable to Balambañgan
for a settlement; as if the harbours be not good, there is sufficient
shelter against both monsoons.
The next island is Mali Wali, and here we anchored to examine it.
We tried at many places, but found the little creeks shallow and lined
with mangrove swamps; but by landing on the south side, at the east
end of the stone beach, there is but a few minutes’ walk in dry forest
between the shore and the cleared land. The appearance of the
island is remarkable; for miles the hills apparently are clothed with
grass, with only a narrow belt of jungle skirting the shingly beach; the
reality, however, disappointed us, as we found that this verdant-
looking land was but a heap of soft sandstone, with long coarse
grass growing up between the crevices. However, there is a good
supply of clear water from tiny streams and springs, and the tracks of
deer were observed in many places, while on all sides a species of
wild jasmine grew in luxuriance, bearing a very sweet-scented
flower.