A British names John Cary wrote a treatise called An Essay on the State of England in 1695.
He laid out a powerful case for how England, through muscular government intervention in economic affairs, could create national wealth based on manufacturing. This production would be fueled by an imperialistic British Empire, which through its expansion would provide the needed raw materials.
The book proved extremely persuasive at home and also abroad after being translated into French, Italian, and German. Government leaders and policymakers in each of these countries were influenced by the Essay’s key idea that government should be a dominant player in helping shape economic development.
Sophus Reinert of HBS historian brings this to limelight in a book called Translating Empire: Emulation and the Origins of Political Economy.
There is a nice interview in which he explains the book:
Q: Why is the Essay and its various translations written for other countries important for our understanding of the development of the political economy in Europe and the New World?
A: Because they help us understand the actual ideas and policies that were influential as Europe first took off relative to the rest of the world. They also shed light on the historical interconnection of businesses and governments at the dawn of real globalization. The reigning idioms of political economy, its proposals, and their implementation in the long eighteenth century were very different from the ideas later celebrated by the economics profession.
Whether or not we like it, we have to accept that European governments played a crucial role in assuring the Continent’s competitive development, and that international emulation was a major vehicle of this process. This is something of which “founding fathers” from Alexander Hamilton to Manuel Belgrano were all too aware, and my book concludes by highlighting the historical irony of how European debates about political economy were translated with time across the Atlantic in the late-eighteenth and early-nineteenth centuries. Through acts of translation, and in the context of intense processes of international and even global emulation, what previously had been tools of empire became instruments of liberty; economic ideas once marshaled to the cause of imperialism were transformed into a political economy of independence in former colonies, a political economy anchored in the essential necessity of encouraging domestic industries on the British model.
The book lost out as Europe and UK developed. However, it throws some interesting ideas on prevalent economics then. People believe econs thought free trade was good in 18th century. However back then trade was seen as a way to increase mercantilism:
Q: How does your research change the ways economists might think about the foundations and future of their discipline?
A: My analysis of the actual flows of economic translations in the European world between 1500 and 1849 suggests that we need to completely rethink what economic ideas were actually influential in that period. The mismatch between the ideas that historically had consequence and those that contemporary scholars have claimed to have had consequence is truly staggering. If we want anything like a realistic idea of how the world got where it is this has to be remedied.
Where the consensus today is that eighteenth-century economists believed that free trade would bring peace and prosperity to all, the mainstream of political economy at the time was actually preoccupied with how trade could be a form of conquest and how political communities could best nurture and encourage their industries against foreign competitors. In addition to ideas, the economic policies resulting from them in the early modern period will need to be engaged with more actively by historians and economists. It is now obvious that economic policies, even aggressively interventionist ones such as high tariffs, at times have had extremely beneficial consequences for some.
The forgotten book throws some lessons for today’s world where we are wondering whether or not to regulate more. He says the debate is misplaced as issue is not whether regulation is good or evil. But how can it be framed to make a better world and encourage economic activity as well:
Q: In the upcoming presidential race, this issue of to what extent government should regulate or encourage commerce will be a central debate. How does your research help us think about this question?
A: History is a mirror that is both reflecting and distorting, and can very seldom offer us easy answers to current problems. That said, it can raise the level of our debates on these issues.
We are stuck now, not only in the United States but in many European countries, in a polarized polemic in which pundits and politicians alike suggest to us that the essential question of political economy is one of choosing between planning and laissez-faire, between Stalin and Ayn Rand, between stupidity and intelligence.
This is as specious as it is dangerous. The encouragement and regulation of economic life has been a mainstay of civilization since the dawn of written history. There have been periods of dogmatic laissez-faire before, though never on the scale we have experimented with since the 1980s, and it must be said, they have tended to end in famine, bankruptcies, and social unrest. Governmental interventions can of course create much mischief, but they have also nurtured practically every economic miracle we know of, from the commercial revolution in Renaissance Italy to the nineteenth-century USA to South Korea in the 1960s and contemporary China. This does not mean that governments always know what they are doing, far from it, but it does indicate that our debates should be over what sort of interventions and what level of regulation is appropriate in a given context rather than whether regulation itself is a moral good or evil.
Superb stuff.
Economic history is wonderful as always. This idea of how mainstream economists then had different ideas on trade is illuminating.
Again, this earlier posted paper on mainline vs mainstream econs is very useful. Smith, Ricardo etc are always seen as mainline whose thoughts are relevant even now. Thoughts of mainstream ones are as powerful but may not be as long lasting as mainline ones.
