Abstract
This paper deals with the origins and functions of the Swedish consular service in Southern Europe between 1720 and 1815. It is argued that establishment of the consular service was a necessary part of the Swedish policy of trade expansion. Consuls acted partly as commission agents of Swedish merchant and shipowners, because Sweden lacked established trading contacts in the area. Partly, consuls had official diplomatic functions, especially in North Africa. The consular service is conceived as an institutional arrangement reducing transaction costs of Swedish agents. This article suggests that reduction in protection costs in particular was a significant competitive advantage of Swedish merchants and shipowners and was due to peace treaties with the Barbary states in North Africa and Sweden's neutrality in the 18th‐century great power conflicts.
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