February 24, 2003

Notes: European Economic History

Rui Pedro Estevez: Monday 11-12: Read for Febuary 24: Carlo Cipolla, Before the Industrial Revolution; Hoffman, Growth in a Traditional Economy, difference between 100% and 80% requirement for agreement with an enclosure... Internal trade blockages? Northern France vs. England. Physiocrats. Why was England first? Why was France second? Jean-Laurent Rosenthal knows more than anybody should about eighteenth-century canal building in Provence...

Problems with North and Thomas. Places where the French state was to weak to support eighteenth-century development

Read for March 3, Franklin Ford, Robe and Sword, John Brewer, Sinews of Power. A detour into political and cultural history--Franco-British comparison. Whatever bad things we say about French 18th century institutions, this is still the third-richest economy and second most powerful state in the world in the 18th century. It's institutions weren't that bad.

Reach for March 10: de Vries on the Dutch Republic...

Posted by DeLong at February 24, 2003 11:53 AM | TrackBack

It's not pure economics, but I really like Jonathan Israel's, "The Dutch Republic: Its Rise, Greatness and Fall 1477-1806.

A careful read clearly reveals that Mackay's report of the Tulip Mania is quite fanciful. Tulip bulbs weren't the center of anything in the 1600s in Holland - it's just that expanding trade brought incredible riches to the country in a short period of time and the excess wealth drove up prices of lots of stuff. And Mackay is completely wrong about a great depression striking the land in the wake of the tulip mania; it just didn't happen. The Dutch economy grew throughout the 1620s and 1630s - in fact, some refer to the period as the Golden Era of Dutch History.

Posted by: Anarchus on February 24, 2003 12:26 PM

what exactly are physiocrats? As I understand it, in a world were people and recourses are free to move as will, and people are honest, local ressources should not be relevant to the welfare of the population. But that is not our world, so what the relevancy of this old economic current?


Posted by: Antoni Jaume on February 25, 2003 10:26 AM

Among other thoughts:

A major agricultural breakthrough occurred in England in the early 1700s with the invention of four-course rotation. By treating farming as a science, continually experimenting with new vegetables and grains, English farmers discovered that by introducing root crops (such as turnips or potatoes) and cover crops (such as clovers) into their mix of planted crops each year they could improve land productivity and soil health.

The replacement of the three-field rotation system (wheat, barley, fallow) by the four-course rotation system (wheat, turnips, barley, clover) was a radical invention in its day. First it ensured that no land would need to lie fallow between periods of cultivation. Second, it meant that clover, turnips and potatoes could be harvested throughout the winter and feed to animals.

For the first time, farmers in England had enough grain to feed their livestock throughout the winter. This did away with the historical practice of slaughtering animals in the autumn and salting the meat for storage through the winter, which was detrimental to people’s health. Over a few short generations food surpluses and improved protein intake by the English population began to significantly decrease infant mortality, increasing population growth. The result was growing supply of labor for the burgeoning factory system.

The growth of the factory system in England was supported by a political doctrine that was more open than most other European counties. The English government allowed the domestic economy to function with few restrictions and encouraged both technological change and a relatively free market. This made possible the development of the financial intermediaries who could lend money, increasing the availability of credit to entrepreneurs. England’s central bank acted as an intermediary stabilizing credit and further enhancing the effectiveness of the credit markets, which made the borrowing of capital to expand production in England easier than the rest of Europe.

England’s simplified taxation structure also played an important role in accelerating economic growth. The French farmers was forced to pay taxes and tariffs and were restricted in terms of where they could sell their food. An English farmer could move about his locale or across the country to sell his goods without additional taxes. Thus, the English farmer had a larger profit making potential. Over time, this large market opportunity increased competitive pressures for agricultural specialization and improved productivity. High productivity and low food prices meant that the typical English family did not have to spend almost everything it earned on bread (as was the case in France), and instead could purchase manufactured goods.

Posted by: Zack Lynch on February 25, 2003 11:16 PM
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