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Nation, State, and the Economy in History

Author(s):Teichova, Alice
Matis, Herbert
Reviewer(s):Baten, Joerg

Published by EH.NET (April 2004)

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Alice Teichova and Herbert Matis, editors, Nation, State, and the Economy in History. Cambridge: Cambridge University Press, 2003. xvi + 450 pp, $75 (hardback), ISBN: 0-521-79278-9.

Reviewed for EH.NET by Joerg Baten, Department of Economics, University of Tuebingen.

Nation, State and the Economy in History … when I first read the title of this volume, I expected a collection full of interesting maps and figures on topics such as the economic development of ethnic groups within states. Other research agendas under this title could have been the role of economic policy on growth, and economic determinants of state formation. These second and third points are addressed in most of the twenty-one chapters, but my hope for interesting maps and figures was soon disappointed. Any kind of quantitative information is in quite scarce supply in this volume, perhaps because it stems from a session of a history congress (the 2000 International Conference on Historical Sciences).

One of the notable exceptions to this rule is David Good’s study on the regions of the Habsburg monarchy. Based on his earlier studies, Good assesses how the nationalities and ethnic groups fared before the Soviet communists captured territories such as Hungary, Czechoslovakia and the Balkan States that had been part of Austria-Hungary until 1918. Using his bold (and not undisputed) proxy estimates, Good confirms the hypothesis that the Habsburg government invested quite heavily in those regions, because they wanted to make their ethnic groups satisfied.

In contrast to Good’s view, Michael Palairet draws a dark picture of neighboring Serbia’s income development in the late nineteenth century. He assumes a strong decline (to support his argument that Serbia never fared well when it was on its own, while it did better in multinational states such as former Yugoslavia). It would be very interesting to apply Good’s estimate to this nearby country. This kind of contrast might stimulate fascinating insights into economic history in the future.

A very interesting and provocative study (and another exception to the statement above) is Kent Deng’s chapter on China in the nineteenth century. Deng argues that the economic policy reforms after the Opium Wars gave very positive stimuli to the Chinese economy, but those were not perceived appropriately because of the adverse distributional impact and the dominance of the military-political over the economic sphere. He emphasizes in particular the industrial and governmental achievements between the 1840s and early 1890s: less distortion from trade restrictions, the growth of the industrial and military sectors, exports and taxation. His analysis would be still more convincing if he had provided a detailed assessment of reliable welfare indicators and had set them into international context.

The “nation, state and the economy” bracket in Deng’s work is the influence of economic policy on the economy — not exactly a narrow topic. This is also visible in the contributions of the “Grand Old Men” included in this volume, such as Patrick O’Brien, Gavin Wright, and Francois Crouzet. In those chapters the book has many features of a textbook on the history of economic policy. They provide numerous interesting details, but no main hypothesis to which a reviewer can easily refer. This textbook character is even more in evidence in Gerd Hardach’s summary of the events in Germany, Carlos Marichal and Steven Topik’s chapter on Brazil and Mexico, Eugenia Nunez and Gabriel Tortella on Spain, and Vaclav Prucha’s description of the Czechoslovakian state. In the latter case, Prucha pays more attention to the interplay between the various nationalities. But again, economic outcome and welfare indicators of some sort are needed if one discusses the economic development of those groups, otherwise it remains impressionistic.

In a chapter on Japan, Hidemasa Morikawa is interested in the relation between economic policy and the development of Japanese firms. He finds, among other results, that especially the smaller firms did not benefit from the active role of the state as much as the large firms. The chapters on Latin American countries are inspired by the intellectual tradition of deep skepticism versus free trade and “capitalism.” Domingos Giroletti, for example, describes the infrastructure and the protectionist measures of the Brazilian state in the nineteenth century. Unfortunately, he does not provide figures on core questions: Was trade really reduced? Or was there only a modest limit on rapid trade expansion? He then goes on to describe the trade collapse of the later interwar period, which he characterizes as a “success” for Brazil (p. 376). Statements like this should perhaps be counterchecked with references to the international economic history literature, and by scrutinizing the long-run effects.

The volume is impressive, because it has wide coverage of countries and regions of the world. The inclusion of countries about which we know little is a major advantage of this endeavor. Two essays focus on Africa: one gives a broad overview (Catherine Coques-Vidrovitch, sometimes perhaps stating the obvious too much), and a case study deals with Senegal in the 1960s (Ibrahima Thioub), highlighting the interesting interplay between groundnut promotion policies and corruption. Moving from Africa to South Asia, developments in India are described in a somewhat postmodern and culturalistic way (B.R. Tomlinson). The more interesting aspect here is the mentioning of the British “divide and impera” policy between Muslims, Hindus, and other groups and its impact on subsequent state formation.

Cultural and life-style aspects of economic policy are also important in the chapters on the Nordic countries, especially in Goran Nilsson’s biographic chapter. The other chapter on Scandinavia, by Francis Sejersted, concentrates more on the relationship between economic policy and social groups, and finds in this respect a common basis with the Australian study by Christopher Lloyd who is interested in laborist-protectionism, and with the Austrian study by Ernst Bruckmueller and Roman Sandgruber who use psychological theories to assess the very strong mentality of cooperativeness among social groups in this Alpine republic. Jumping from Austria to Israel, Jacob Metzer is interested in another social group, the agricultural workers and cooperative members in Israel, for which the state performed an economic policy of varying protection, given their labor market competition with Arab laborers. All these aspects, which I can only mention here in short, highlight the broad design of this volume, that addresses a great variety of issues.

Finally, Russia. Peter Gatrell and Boris Anan’ich argue that the role of nationalism was very limited both in Tsarist Russia and in the Soviet period until the 1970s (!). The Tsarist governments made their geopolicy mainly in dynastic interest, and only seldom played the national card. Ethnic conflicts such as Azeri workers attacking Armenian businessmen and Ukrainian peasants attacking Russian landlords were not very frequent in late Imperial Russia, so they argue. Even for the Soviet period, the authors stress the participation possibilities of the smaller nations, albeit without forgetting to mention the russification policies.

The volume as a whole is well-edited and the editors have done good work to make sure that all the chapters are easy to read and of high quality — even if, as mentioned, many of them are not structured by a leading question or an argument. This makes it difficult for the editors to summarize the main findings of the contributions in their introductory chapters. They often resort to citations of whole paragraphs from the individual contributions.

Some papers in an earlier volume on a very similar topic by the same editors (plus Jaroslav Patek) were criticized by Stanciu Haar in her review for their lack of theoretical guidance and concept. I think that this criticism cannot be fully rejected for the current volume as well. On the other hand, the individual chapters provide a rich source of details about economic policy of the various countries, and sometimes about ethnic minorities and state formation. Readers will hold this volume in high esteem for this richness in details, especially on countries that lack newer textbook descriptions.

Joerg Baten is Professor of Economic History at the University of Tuebingen and CESifo fellow. He is the author of a number of studies in anthropometric history, financial market research, and the economic history of firms.

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Subject(s):Economywide Country Studies and Comparative History
Geographic Area(s):General, International, or Comparative
Time Period(s):20th Century: WWII and post-WWII