Almost without exception, the economics of imperialism can be described as “plunder economies.” This entailed three tendencies. First, colonial regimes expropriated the land from the people who lived there. This was accomplished through force, backed by pseudo-legal means: unless a given person, or group, had a legal title in the western sense to the land they lived on, they were liable to have it seized. Likewise, traditional rights to hunt, gather material, and migrate with herds were lost. Second, colonial regimes expropriated raw materials like rubber, generally shipped back to Europe to be turned into finished products. Third, colonial regimes exploited native labor. This was sometimes in the form of outright slavery like the Congo, the Portuguese African colonies, and forced labor in French and German colonies. In other cases, it consisted of “semi-slavery” as on the island of Java where the Dutch imposed quotas of coffee and spices on villages. In other areas, like most of the territories controlled by Britain, it was in the form of subsistence-level wages paid to workers.

In addition to the forms of labor exploitation, European powers imposed “borders” where none had existed, both splitting up existing kingdoms, tribes, and cultures and lumping different ones together arbitrarily. Sometimes European powers favored certain local groups over others in order to better maintain control, such as the British policy of using the Tutsi tribe (“tribe” in this case being something of a misnomer – “class” is more accurate) to govern what would later become Rwanda over the majority Hutus. Thus, the effects of imperialism lasted long after former colonies achieved their independence in the twentieth century, since almost all of them were left with the borders originally created by the imperialists, often along with starker ethnic divisions than would have existed otherwise.

In a somewhat ironic twist, only certain specific forms and areas of exploitation ever turned a profit for Europeans, especially for European governments. Numerous private merchant companies founded to exploit colonial areas went bankrupt. The entire French colonial edifice never produced significant profits. Since governments generally stepped in to declare protectorates and colonies after merchant interests went under, the cost of maintaining empire grew along with the territorial claims themselves. Thus, while economic motives were always present, much of the impetus behind imperialism boiled down to jockeying for position on the world stage between the increasingly hostile great powers of Europe.