Published by EH.NET (October 1998)
Thomas Brennan, Burgundy to Champagne; The Wine Trade
in Early Modern France. Baltimore: Johns Hopkins University Press, 1997.
376 pp. $39.95
(cloth), ISBN: 0801855675.
Reviewed for EH.NET by Jean-Laurent Rosenthal, Department of Economics,
In a country that prides it self on its wine tradition, one often easily
forgets how many revolutions have occurred in the wine economy. Thomas
Brennan’s monograph takes up the transformations of the commerce of Northern
French wine in the century before the Revolution. Based on an elegant mix of
secondary histories of particular wine traders (negociants) and wine growers
and of archival sources, the book offers a careful description of the
transformation of the wine trade between 1700 and 1789. More
importantly, Brennan avoids the pitfalls of localism by taking in both
Burgundy (a high quality but distant producer) and Champagne (a producer of
varying appeal but more proximate) and by careful reference to the other major
vineyards of the area (Paris and the Loire Valley). Because these two regions
had significantly different experiences, generalizations are not easy to come
The book is a dialogue between the history of Burgundy and Champagne, with
occasional forays into the wider world of Parisian and French wine brokerage.
In the chapters on Burgundy and Champagne,
Brennan bring into sharp relief the importance of information and credit in the
commerce of wine. Brennan’s focus is on expensive wines for which price is much
more a reflection of quality than of quantity.
Yet quality is elusive because urban buyers (whether rich consumers or wine
merchants) simply cannot take the time to comb the countryside for a particular
wine. Hence, there was a great need for brokers. The monarchy had, at first,
by forbidding individuals who took this occupation from selling wines on their
own account. The hope, one presumes, was that brokers would, therefore,
put all their efforts into satisfying their clients. Furthermore, by limiting
themselves to strict broke rage, these intermediaries left the buyers and
sellers to bear the risks involved in the market.
Yet, other developments in the wine industry made such distinctions impossible.
Two elements in particular made them more active. First,
because of their privileged “expertise,” the brokers could hardly resist the
jump from negotiating deals to speculating on their own accounts.
Second, because of their information, they were the ideal financial
intermediaries for the wine economy that included both wine retailers and wine
As brokers they purchased wine on credit and sold wine on credit, for they
were paid neither when they received nor when they delivered an order, but when
the buyer could pay. They, in turn, attempted to delay payments to vine
growers as much as possible. Because the trade was on a credit basis, brokers
had to bear risk–the jump from the risk associated with lending to buyers, to
the risk of buying wine on ones own account was small. It was also virtually
impossible to detect
What official could tell whether a broker sending wine from Epernay to Paris to
a wine merchant was acting at the direction of the merchant or on his account?
There were other more local reasons for the growth of the role of brokers.
required high quality wines which, in turn,
required increased investments in an activity that was already capital
intensive. Yet those investments were not without risk. Brokers,
because of their knowledge of demand and because of their keen knowledge of
local conditions, were ideally placed to bear those risks. As Brennan
describes, the development of sparkling Champagne was the result of a
“redevelopment” of a region whose previous product
(red wine) had fallen out of favor. Despite the legend of Dom
Perignom single-handedly inventing the bubbly, the reality is that its growth
into a marketable product was fraught with obstacles that the brokers slowly
removed. First, wine was typically transported in barrels (which were cheaper
and more robust) rather than bottles, but Champagne had to be bottled quickly,
so as to capture the second fermentation that leads to the sparkles. Second,
the bottles had to be strong enough to resist the increased pressure–no small
feat in a period of blown glass–and losses due to exploding bottles could be
devastating at times.
Hence from simple retailers, brokers took on an important role in shaping the
market’s product at the local level. Because the demand for high quality wine
in Paris was, after all, limited and because the Northeast faced competition
from the Loire and the Bordelais, brokers took on the task of developing or
regaining markets in Northwest Europe.
Though we learn an enormous amount from Brennan’s monograph, the economic
historian may be a bit
chagrined with the analytical structure.
Central to the volume are two distinctions: first, between a transparent market
where buyer and seller meet in public and pay cash, and that of an opaque or
private market where buyers and sellers need not meet, where transactions are
hidden from the public and where credit greases the wheels of commerce; second
between competition and power. Here Brennan is less clear about the dichotomy,
but individuals who are attributed economic power have informational and/or
financial advantages over other protagonists. This reviewer wonders about the
value of either opposition.
As Brennan himself recognizes, transparent markets only allow a very limited
number of transactions. Further opacity need not imply a lack of competition
if all parties are accustomed to the process. Similarly, to call informational
advantages “power” hardly helps our understanding.
One can, however, read the volume with an eye to the different gains that
the expansion of markets could offer. Some were temporary, for instance when
a sudden increase in demand for a particular type of wine was not met by an
immediate increase in supply. This short-run gain would be captured by
brokers, but would rather quickly translate into higher prices in the
countryside. Then there would be the traditional response of planting more
vines which would drive prices down again.
After a while the only change in the countryside would be higher employment.
There is an alternative long-term scenario. This one had more complex effects
on the local economy, because it involved the development of wines whose
qualities could not be easily reproduced (that was the case for both Champagne
and Burgundy). Here brokers enjoyed some
early profits from finding the demand for
but in time much of the final value of that wine would be transferred to the
owners of the land. For the past several hundred years at least, France has
been a battlefield between the efforts of quality wine producers to limit
imitation and the
efforts of others to make more of what is desired. Brokers, whatever their
information and their power, contributed to this battle by first selling high
quality wine and then seeking out new sources of such wine. Further
consideration of the nature of land and information rents in the wine industry
might lead us to a better understanding of why the commerce of wine failed to
be centralized in Paris and rather remained the domain of a plethora of local
brokers. Those scholars who will take up this task
will be grateful for the existence of
Burgundy to Champagne.
Jean-Laurent Rosenthal Department of Economics UCLA
Jean-Laurent Rosenthal is author of The Fruits of Revolution:
Property Rights, Litigation, and French Agriculture, 1700-1860
University Press, 1992).
|Subject(s):||Industry: Manufacturing and Construction|
|Time Period(s):||18th Century|