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The Engine of Enterprise: Credit in America

Author(s):Olegario, Rowena
Reviewer(s):Wright, Robert E.

Published by EH.Net (February 2016)

Rowena Olegario, The Engine of Enterprise: Credit in America. Cambridge: Harvard University Press, 2016. v + 301 pp. $40 (cloth), ISBN: 978-0-674-05114-0.

Reviewed for EH.Net by Robert E. Wright, Thomas Willing Institute, Augustana University.
Rest assured that I did not judge this book by its cover, ugly as the 1940 GMAC advertisement the book designer chose to use appears to my eye. But try as I might, I could not find an appropriate audience for this (perhaps overly) ambitious undertaking after perusing it for several days. There is no preface to help readers to understand the author’s goals or the book’s purpose and the introduction launches directly into the content.

As its title suggests, the thesis of The Engine of Enterprise is that “the United States was built on credit” (p. 1) or, with more nuance, “despite problems with credit that were at times severe, and which Americans have never fully solved, credit has been the invigorating principle that turned potential wealth into national prosperity” (p. 226) (my emphases). The proof comes in the form of five narrative chapters covering the colonial and early national (Chapter 1: “The Foundations of Credit in the New Republic”), antebellum (Chapter 2: “Credit, Enterprise, and Risk in the Antebellum Era”), postbellum (Chapter 3: “Credit in the Reconstructed Nation”), interwar and postwar (Chapter 4: “A Nation of Consumers and Homeowners”), and late twentieth century (Chapter 5: “The Erosion of Credit Standards”) periods, plus a brief postscript (“Creative and Destructive Credit”) on the causes and consequences of the Panic of 2008. The chapters do not follow a cookie cutter format but many cover the same topics, e.g., consumer credit, business credit, bankruptcy, and so forth.

While narrative descriptions of the evolution of different types of credit abound, the book does not show the primal importance of credit in statistically rigorous (e.g., Rousseau and Sylla 2005) or internationally comparative (e.g., Beck, Demirguc-Kunt, Levine 2007) ways, or even cite the finance-led growth literature (see Levine 2005 for a review). Moreover, the finance-led growth hypothesis was tempered by studies (e.g., Martin 2010; Wright 2008) that showed that financial development is just one of a series of growth-inducing economic changes that begin with secure human rights and end with improvements in physical and human capital that drive productivity gains. Because microfinance failed to spur growth in anarchic or dictatorial states, few continue to baldly assert the primacy of finance, let alone just its credit component. Alexander Hamilton had it exactly right when he argued that credit “was among the principal engines of useful enterprise” (p. 4) (my emphasis), i.e., that credit is a necessary but not a sufficient cause of economic growth. It is the fuel injection system, in other words, not the entire engine.

The book is unlikely to appeal to other specialists, either, as it is not based on new or extensive archival research or even novel interpretations of printed primary sources. As a senior research fellow at Said School of Business, author Rowena Olegario lives thousands of miles from scores of archival U.S. bank records that range from underutilized to completely untouched (for a partial list, see New Bedford Whaling Museum 2011), but one would think that Oxford University could afford to pay for the filming of, and/or travel to, at least one set of U.S. banking records. Moreover, although Olegario occasionally alludes to the theory of asymmetric information, the book is largely devoid of pertinent economic theories. So in her narrative, the early economy was “vulnerable to external shocks” (p. 24) due to unregulated banks and banknotes rather than the nation’s solution to the Trilemma or Impossible Trinity, a bimetallic standard demanding free international capital flows and fixed exchange rates in lieu of a central bank with significant monetary policy discretion.

Although The Engine of Enterprise presents more evidence about what people thought than how they behaved, the book is not a compelling “history of thought” either. Olegario, for instance, credits Henry C. Carey with being “the most notable economist of his time” and with anticipating “the new institutional economics by a century and a half” (p. 7). Carey’s life (1793-1879) overlapped those of important American political economists like Edward Atkinson (1827-1905), Alexander Bryan Johnson (1786-1867), and Erasmus Peshine Smith (1814-1882), not to mention numerous European economists of far more probity. Moreover, most of Carey’s ideas merely reiterated the thought of Hamilton and other financial founding fathers and even his own biological father. Olegario herself later (p. 59) admits that Carey was less important than Henry George (1839-1897).

Given its long coverage, from the colonial period to the present, the book might have been designed as a survey text, but for what course and at what level? Graduate students would quickly dismiss The Engine of Enterprise because it does not discuss historiography and glosses over the few debates that it explicitly recognizes without describing the major issues or even mentioning the major contributors. For example, Olegario informs readers that “historians are not in full agreement about how stringently” (p. 28) usury laws were enforced in colonial America but the corresponding note refers only to Geisst (2013). Most other debates are not even hinted at in the notes. For instance, the author blithely asserts that some colonial bills of credit depreciated because they “were insufficiently backed by land or taxes” (p. 21) without mentioning the long debate over “backing theory” (e.g., Michener 2015). Moreover, many endnotes point to a relatively limited set of broad secondary sources, like Wood (1991), Morgan (2000), and Calomiris and Haber (2014), rather than relevant specialized monographs like Kamoie (2007), which details the credit relations of the important Tayloe family in Virginia, or Roney (2014), which describes how NGOs in colonial Philadelphia served as financial intermediaries. Worse, works long since superseded are cited, some with disturbing frequency (e.g., Foulke 1941; Trescott 1963).

I also doubt that anyone teaching a financial history survey would adopt this book as an undergraduate text. The prose, while competent, is pedestrian throughout and hence more likely to bore Millennials than to spur their interest in financial history. Similarly, general readers usually demand ripping yarns like those spun in Kamensky (2008) or Mihm (2009). Lucid sections can of course be found (particularly recommended are the discussions of bankruptcy), but their benefits are outweighed by conceptual flaws and errors of commission and omission. By the latter, I mean missing important supporting data, superior examples, or more telling points. For instance, to make the point that Benjamin Franklin “took for granted that credit was essential to commerce” (p. 2), Olegario adduces mere words, Franklin’s “Advice to a Young Tradesman,” rather than Franklin’s actual actions, most notably his establishment of microfinance institutions in Philadelphia and Boston (Yenawine and Costello 2010). Likewise, the best evidence that the “new banks were meant not just to serve the needs of governments and merchants but also tradesmen, farmers, and manufacturers” (p. 24) is not Pennsylvania’s Omnibus Banking Act of 1814 but studies like Lockard (2000) and Wang (2006) that document actual bank lending patterns, a type of direct evidence that the author suggests does not exist (p. 64).

Olegario has particular difficulty astutely narrating the history of early U.S. finance because she accepts a narrow anthropological literature (e.g., Muldrew 1998) that sees much of the colonial credit system as pre-capitalist, as part of a “moral economy” characterized by “trust” and “barter” (pp. 24-25). But Olegario herself destroys both claims, presumably inadvertently. “Households bartered produce, game, and animal skins to obtain the services of blacksmiths, coopers, and other artisans,” she claims, but then adds that such exchanges were “notated in rough ledgers [sic] using monetary values even though no actual cash changed hands” (p. 24). So such transactions were not barter (trading one good for another without the use of money in any of its forms) at all but rather a form of open account, book credit, or “bookkeeping barter” (Michener 2011). Olegario also subverts the supposed reliance of colonial creditors on “trust” by detailing the widespread use of collateral, co-signers, lawsuits, prison, threats of reputation tarnishing, and other devices designed to induce borrowers to repay their debts. Colonists were certainly more apt to be lax when lending to family and friends, but that does not mean a “noncommercial morality” (p. 25) suffused the economy as family matters stand no differently today.

Other errors abound and many would flummox students and general readers. Olegario claims, for example, that bills of exchange “functioned as currency” (p. 21) by conflating negotiability (via endorsement) and currency (passing from hand to hand without formal assignment). By conflating banknotes with bank loans, she can assert that “entrepreneurial society desired … paper money” (p. 23) when in fact it sought intermediation. Imagine the confusion that would ensue were students to read that retailers “notated the value of purchased goods in a day book or ledger without issuing [sic] formal instruments like notes or bills of exchange” (p. 24). (Borrowers, not lenders, issue debt instruments.) Or that the Bank of the United States (1791-1811) was “rechartered [sic]” (p. 42) to be “in existence … again [sic]” (p. 49) as the Bank of the United States (1816-1836)!

I could continue but won’t for fear of drawing a flag for unscholarly-like conduct. Perhaps some readers will think I deserve a flag already but when the author’s school and publisher are so prestigious I think it incumbent upon reviewers to support negative generalizations with sufficient citations, details, and examples. The dust jacket can be removed if readers don’t like it, but the same can’t be said of the text, so potential readers must be credibly pointed elsewhere, like to the recent works cited below.


Beck, Thorsten, Asli Demirguc-Kunt, and Ross Levine. 2007. “Finance, Inequality, and Poverty: Cross-Country Evidence.” Journal of Economic Growth (March): 27-49.

Calomiris, Charles and Stephen Haber. 2014. Fragile by Design: The Political Origins of Banking Crises and Scarce Credit. Princeton: Princeton University Press.

Foulke, Ray. 1941. The Sinews of American Commerce. New York: Dun and Bradstreet.

Geisst, Charles. 2013. Beggar Thy Neighbor: A History of Usury and Debt. Philadelphia: University of Pennsylvania Press.

Kamensky, Jane. 2008. The Exchange Artist: A Tale of High Flying Speculation and America’s First Banking Collapse. New York: Viking.

Kamoie, Laura Croghan. 2007. Irons in the Fire: The Business History of the Tayloe Family and Virginia’s Gentry, 1700-1860. Charlottesville: University Press of Virginia.

Levine, Ross. 2005. “Finance and Growth: Theory and Evidence.” Handbook of Economic Growth, edited by Philippe Aghion and Steven Durlauf. Amsterdam: Elsevier Science.

Lockard, Paul. 2000. “Banks, Insider Lending, and Industries of the Connecticut River Valley of Massachusetts, 1813-1860.” Ph.D. Dissertation. University of Massachusetts, Amherst.

Martin, Joe. 2010. Relentless Change: A Casebook for the Study of Canadian Business History. Toronto: University of Toronto Press.

Michener, Ron. 2011. “Money in the American Colonies.” EH.Net Encyclopedia, edited by Robert Whaples.

Michener, Ron. 2015. “Redemption Theories and the Value of American Paper Money.” Financial History Review (December): 1-21.

Mihm, Stephen. 2009. A Nation of Counterfeiters: Capitalists, Con Men, and the Making of the United States. Cambridge: Harvard University Press.

Morgan, Kenneth. 2000. Slavery, Atlantic Trade and the British Economy, 1660-1800. New York: Cambridge University Press.

Muldrew, Craig. 1998. The Economy of Obligation: The Culture of Credit and Social Relations in Early Modern England. New York: St. Martin’s Press.

New Bedford Whaling Museum. 2011. “Records of the Merchants Bank Finding Aid, Appendix C,” MSS 107, New Bedford, Mass.

Roney, Jessica Choppin. 2014. Governed by a Spirit of Opposition: The Origins of American Political Practice in Colonial Philadelphia. Baltimore: Johns Hopkins University Press.

Rousseau, Peter and Richard Sylla. 2005. “Emerging Financial Markets and Early U.S. Growth.” Explorations in Economic History (March): 1-26.

Trescott, Paul. 1963. Financing American Enterprise: The Story of Commercial Banking. New York: Harper and Row.

Wang, Ta-Chen. 2006. “Courts, Banks, and Credit Markets in Early American Development.” Ph.D. Dissertation. Stanford University.

Wood, Gordon. 1991. Radicalism of the American Revolution. New York: Random House.

Wright, Robert. 2008. One Nation under Debt: Hamilton, Jefferson, and the History of What We Owe. New York: McGraw Hill.

Yenawine, Bruce and Michele Costello. 2010. Benjamin Franklin and the Invention of Microfinance. London: Pickering & Chatto.

Robert E. Wright is the Nef Family Chair of Political Economy at Augustana University and the author or co-author of seventeen books, including, with Richard Sylla, Genealogy of American Finance (Columbia University Press, 2015).

Copyright (c) 2016 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (February 2016). All EH.Net reviews are archived at

Subject(s):Financial Markets, Financial Institutions, and Monetary History
Geographic Area(s):North America
Time Period(s):18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

States of Obligation: Taxes and Citizenship in the Russian Empire and Early Soviet Republic

Author(s):Kotsonis, Yanni
Reviewer(s):Nafziger, Steven

Published by EH.Net (January 2016)

Yanni Kotsonis, States of Obligation: Taxes and Citizenship in the Russian Empire and Early Soviet Republic. Toronto: University of Toronto Press, 2014. xx + 483 pp. $80 (hardcover), ISBN: 978-1-4426-4354-3.

Reviewed for EH.Net by Steven Nafziger, Department of Economics, Williams College.

This deeply researched study by a leading Russian historian centers on Tsarist and early Soviet experiences with tax reform in the late nineteenth and early twentieth centuries. The book presents a complex argument that centers on the movement towards individual assessment of wealth and personal income taxes that, while never fully realized, reflected Russia’s advancement towards modern citizenship and statehood between roughly 1870 and 1930. During this period, the state generated knowledge of the Empire’s population, income and wealth, and economic activities through new assessments of taxable resources. As policymakers collected this information and undertook more targeted tax collections (at the firm, household, and, eventually, individual levels), the Russian state was drawn into closer oversight of the economy, while the population was, at least in theory and as the title suggests, nudged towards becoming a real citizenry by the acts of declaring incomes and paying taxes. Although this was the case in cities and for the commercial elite, the retention of more indirect and collectivist fiscal practices in the countryside sharpened the urban-rural divide, limiting the identification of the peasant population with the modernizing efforts of the Imperial and Soviet states.

The book is divided into four interconnected parts. Following an introduction that very nicely places Russia’s tax history in a comparative light (drawing on works like Seligman (1914)), the first chapter in part one describes the Russian state’s fiscal knowledge, taxes, and tax reform efforts through the middle of the nineteenth century. From tax farming and regional apportionment for excise taxes to the use of communal collective responsibility to extract taxes from the peasantry, Kotsonis points out the pre-modern and hands-off (and information deficient) nature of early Imperial fiscal policies. The second chapter summarizes the tax reforms that the regime subsequently embarked upon, including urban and commercial tax reforms, changes to poll and land taxes (especially among the peasantry), and modifications of the excise tax system. This chapter postulates that each type of reform engaged with the relevant base in different ways, with a different set of information requirements and degrees of direct interaction (from individual assessment, to collective obligation, to transaction-dependent).

Utilizing archival records, contemporary publications, and insights drawn from a number of secondary literatures, the second and third parts of the book then focus on a series of policy discussions and tax reforms that emerged in the last third of the nineteenth and early twentieth centuries. The second part considers the progression towards individualized assessment of income and wealth among urban and commercial tax units over the period. Chapters 3 and 4 examine how previously ad-hoc, collective, or apportioned tax bills evolved towards person and firm-specific assessments of urban property, inheritance, and business taxes. These chapters describe the difficulties the regime faced in accurate assessment of taxable resources, and how a reliance on commissions of taxpayers (whether urban property holders or small businessmen), direct reporting (the corporate sector), and a new but limited tax inspectorate emerged. Chapters 5 and 6 then focus on the debates and proposals surrounding a personal income tax, which was only to come to fruition in 1916. It is particularly in Part 2 that Kotsonis emphasizes the evolution of more modern concepts of individual citizenship and legal personhood within tax discussions among Russian intellectual and policy-making elites.

Part 3 first considers indirect taxation (Chapter 7), especially in the form of alcohol excise taxes, and then studies the persistence of collective (i.e. non-individual) taxation of the peasant majority (Chapters 8 and 9). Kotsonis nicely summarizes the large literature on the evolution of Russia’s fiscal treatment of alcohol, from tax farming, to excises laid on producers, to the state monopoly after 1894, to the surprising declaration of prohibition in 1914, which gutted state revenues and partially led to the income tax. As others have noted, Kotsonis points out Russia’s dependence on alcohol revenues, which numerically greatly overshadowed any other types of taxes. This included the various assessments placed on the 85 percent of the population who were peasants. As nicely detailed in Chapters 8 and 9 (particularly with respect to the mechanisms of tax collection), the state actually lowered land and other tax burdens on the peasants from the 1880s onwards. However, into the Soviet period, the regime retained the system of collectively apportioning peasant obligations by province, district, township, and communal body. The frequency of mismatch between tax obligations and payment capabilities that resulted from such a system sharply contradicted the individualization of taxation and state interactions that was happening in the urban and commercial sectors.

Early Soviet tax policies endeavored to chip away at this urban-rural fiscal divide, but this quickly lost momentum, as Kotsonis documents based on a wealth of archival material in Chapters 10-12 of Part 4. Soviet authorities lowered exemption levels for the income tax, thereby doubling down on the commitment to connect taxation and citizenship. But attempts to expand this system to the peasantry failed during the War Communism period (1918-1921), and so authorities reverted to the earlier structure of collective imposition at the level of village, enforced by a greater level of violence. Prohibition ended between 1921 and 1926, with a renewed importance of indirect taxes and allowing some market relations to function under the New Economic Policy. But by 1928, growing state revenue and food demands led to the shift towards collectivization, with the direct imposition of state authority into the rural locality. By this point, Stalin was in charge and the Soviet regime carried state oversight of the economy to its (Communist) conclusion, with large-scale nationalizations and the tightening of state controls across the board. As Kotsonis argues, this was largely repeating the Imperial experience, with more violence thrown in.

I have long thought about many issues discussed in this book and greatly admire the job Kotsonis does in unpacking the intellectual, political, and economic conditions of tax reform in Imperil and early Soviet Russia. Each page delivers an insightful comment or little known but significant fact. The skilled employment of archival evidence and little known official records and contemporary publications generates a nuanced and largely convincing account of the rise of Russian fiscal modernity. The detailed discussions of urban and commercial tax reforms, the ways that indirect (i.e. vodka) taxes functioned, and the collection of collectively imposed obligations from the peasantry are real feats of historical scholarship. The study is impressively engaged with the Russian historiography (including some work in economic history), as well as the broader and comparative histories of taxation in this period. Indeed, a key contribution is to illustrate how Imperial Russia largely shared the experiences of fiscal evolution and state building with many contemporary states, albeit with a distinctive absolutist twist. However, and perhaps unfortunately, I imagine that only a few economic historians will be as interested in or impressed by this study as I was. There are several reasons for this.

The first has to do with style. Kotsonis is a skilled writer, but this study is repetitive at times and probably 20 percent too long. The writing is regularly overtaken with statements and paragraphs that complicate rather than clarify the argument. Sometimes this stems from the odd phrasing of an economic concept or argument (e.g. “The commercial and industrial sector was easily or only expressed as money,” p. 89; “Russia . . . had an inelastic system of revenue,” p. 236); sometimes this is due to almost gleefully convoluted or cryptic sentences (e.g. “The future was folded into the present,” p. 187). Making things more difficult for the non-specialist is the rather erratic utilization of quantitative evidence, where numbers are frequently offered without much effort paid to comparisons across space or over time (for example, the six tables in the book only draw on data from 1913). These stylistic features do not detract from the work’s careful and largely qualitative analysis, nor do they make the text unreadable (far from it!), but they do make the writing quite dense and the argument hard to track at times. While this critique might just speak to this reviewer’s own limitations, it would seem like even very interested specialists will find grappling with this study a difficult task.

A second and more significant difficulty with this book is its relationship to economic analysis and modern economic history. In a nutshell, Kotsonis seems uninterested in engaging with recent economic research on topics ranging from the history of the social welfare state (e.g. Lindert, 2004) to the interconnection between political liberalization and fiscal reform in the long nineteenth century (e.g. Aidt and Jensen, 2009). Economists and economic historians have made major advances in these and related areas over the past twenty years, very little of which is reflected in the footnotes or bibliography of this book. To take one important example: in a book detailing the construction of economic knowledge, administrative practices, and fiscal policy reform proposals, the concept of “state capacity” is never once mentioned, despite its growing prominence in the social sciences (e.g. Besley and Persson, 2009; Dincecco, 2015). To his credit, Kotsonis is interested less in the economics of Russian fiscal policy than the surrounding political and intellectual contexts. Indeed, I would go so far as to argue that economic historians should engage with such contexts when considering the causes and effects of tax changes. However, social science historians without special interests in Russia might feel put off by the absence of direct connections to more familiar literatures and methodological approaches.

A third, related, issue that might limit the appeal of this book to the broader economic history community is the nature of the questions it tackles. While Imperial Russian authorities and policymakers might have been deeply engaged in debates over the proper structure of business and income taxes for decades, no broad income tax was enacted until 1916 (just before the fall of the regime) and it was largely ineffectual in terms of raising revenues in the chaos of the war or during the early Soviet period. Kotsonis discusses myriad other tax reforms over the period, some of which (e.g. changes in alcohol policy) had major revenue implications. However, the main theme of the book — that the move towards income taxation was both cause and effect of a shift towards both individualization and control in the state/citizen relationship — only comes to a head at the very end of the Imperial era and it seems to be contradicted by the absence of real change in the countryside. Thus, all the discussions and debates over taxes among Petersburg elites that Kotsonis details in Part 2 appear to have mattered little on the ground in effecting real change in Russia’s economy and society. The absence of perspectives from small businessmen, commercial farmers, traders, factory workers, and peasants makes it difficult to know whether changes in tax policies really mattered for non-elite conceptions of Russian citizenship. And since the book exclusively focuses on government revenues and ignores expenditures (and largely limits itself to discussing central government taxation), the reader gets little sense as to whether any fiscal developments over the period mattered for the provision of public goods and services.

But Kotsonis does not really have such objectives in mind in writing this book. His intention is to identify how tax discussions among the Russian elite, and the subsequent policies that these generated, reflected and affected the Imperial and Soviet regimes’ engagement with modern state building. In this, he largely succeeds, thereby providing an important contribution towards our understanding of how Russia became modern. For scholars interested in the political and intellectual contexts for fiscal reforms in other (especially lower income) societies in the nineteenth and early twentieth centuries, Kotsonis’s work offers much food for thought. For specialists or fellow travelers in Russian business and economic history, this book is required reading.


Aidt, Toke, and Peter Jensen. “The Taxman Tools Up: An Event History Study of the Introduction of the Personal Income Tax.” Journal of Public Economics 93 (2009): 160-175.

Besley, Timothy, and Torsten Persson. “The Origins of State Capacity: Property Rights, Taxation, and Politics.” American Economic Review 99 (2009): 1218-1244.

Dincecco, Mark. “The Rise of Effective States in Europe.” Journal of Economic History 75 (2015): 901-918.

Lindert, Peter. Growing Public: Social Spending and Economic Growth since the Eighteenth Century. Cambridge: Cambridge University Press, 2004.

Seligman, Edwin R. A. The Income Tax: A Study of the History, Theory, and Practice of Income Taxation at Home and Abroad. Second edition. New York: Macmillan, 1914.

Steven Nafziger is an Associate Professor of Economics at Williams College and a Center Associate of the Davis Center for Russian and Eurasian Studies at Harvard. He is currently working on numerous projects related to the economic development of Imperial Russia.

Copyright (c) 2016 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (January 2016). All EH.Net reviews are archived at

Subject(s):Government, Law and Regulation, Public Finance
Geographic Area(s):Europe
Time Period(s):19th Century
20th Century: Pre WWII

Natural Resources and Economic Growth: Learning from History

Editor(s):Badia-Miró, Marc
Pinilla, Vicente
Willebald, Henry
Reviewer(s):Mohamed, Rahim

Published by EH.Net (December 2015)

Marc Badia-Miró, Vicente Pinilla, and Henry Willebald, editors, Natural Resources and Economic Growth: Learning from History. New York: Routledge, 2015. xix + 374 pp. $160 (hardback), ISBN: 978-1-13-878218-1.

Reviewed for EH.Net by Rahim Mohamed, Department of Political Science, University of North Carolina at Chapel Hill.

Natural Resources and Economic Growth offers a timely and multifaceted look at the often double-edged relationship between natural resource wealth and long-term economic development. The volume’s sixteen chapters, which range in format from single-country case studies to cross-national statistical analyses, address natural resource governance issues that have been encountered on each continent at various points in (generally post-industrial) history. Specific country cases include Australia, Botswana, Indonesia, Nigeria, Norway, Spain, the United States, and Venezuela. Contributors focus heavily, although not exclusively, on the political and economic challenges associated with the endowment of coal, petroleum, precious metals, and other coveted mineral assets. This makes the book an especially informative read in light of the ongoing slump of global commodity prices and the concomitant political fallout now being felt in many resource rich countries.

Broadly speaking, the volume’s contributors take on two major propositions. The first is the existence of (or lack thereof) a “natural resource curse,” as posited by Sachs and Warner (1995, 2001). This term refers to the hypothesized tendency of natural resource rich countries to underperform economically due to self-destructive governance patterns enabled by resource windfalls. The second is the ubiquitous claim that many of the negative externalities associated with natural resource-driven economic growth strategies can be mitigated through the development of effective political institutions, often those associated with democracy and the rule of law (see Acemoglu et al. 2001). The authors mostly re-affirm these positions but, at the same time, bring some much-needed context to the discourse.

The general consensus that emerges from the chapters of Natural Resources and Economic Growth is that abundant natural resources are “non-neutral” for economic development, but their precise effect on a given economy is heavily mediated by a myriad of intervening variables. This is spelled out clearly in the book’s opening chapter by the editors, who write “History teaches us that (resource) ‘curses’ and ‘blessings’ are constructions — they are the result of the socioeconomic system” (p. 17). Moreover, several of the book’s case studies demonstrate that, while good political institutions and public policies can certainly help countries manage natural resource wealth, such configurations are often embedded in unique national histories. This means that policy remedies that have proven effective in one setting will not necessarily work elsewhere.

One excellent example of the non-replicability of distinct natural resource governance schemes is found in the book’s chapter on Norway (chapter 15), co-authored by Andreas R. Dugstad Sanders (of the European University Institute) and Pål Thonstad Sandvik (of the Norwegian University of Science and Technology). Dugstad Sanders and Sandvik, who reconstruct the evolution of Norway’s natural resource regulatory regime over more than a century, portray the country’s vaunted system of oil wealth management as the ultimate product of a complex set of political interactions between social democrat and conservative elements. Specifically, they argue that, while Norway’s dominant Labor Party built the regime’s edifice, its Conservative Party (which governed through much of the 1980s) placed crucial constraints on Statoil (Norway’s state oil company) and other powerful industry players (pp. 326-27). This resulted in a robust yet constrained regulatory framework that, over time, closed off opportunities for rent seeking.

As a group, the authors do an impressive job of providing nuance to the instructive but oversimplified resource curse thesis. The book’s second chapter, written by eminent development economist Richard M. Auty, jumps out in this respect. Auty, who himself coined the term “resource curse” in his 1993 book Sustaining Development in Mineral Economies, argues that “rent curse” is now a more appropriate term for the sharp boom-bust cycle that characterizes many resource rich economies. He holds that the deleterious macroeconomic effects catalyzed by natural resource windfalls can also be sustained by inflows of other types of rent, such as foreign aid and remittances. This happens when high rents encourage the ruling elite to pursue a course of immediate self-enrichment, versus the less expedient strategy of making the growth-promoting investments necessary to build a broad, revenue-generating tax base. Auty’s notion of a rent curse helps explain why the pattern of growth collapse exhibited by resource dependent economies can also be observed in several aid dependent countries, such as those in the largely barren Sahel region of Sub-Saharan Africa (p. 31). This more precise diagnosis of the problem at hand will ideally lead to a more effective course of treatment.

One small editorial note is that the volume’s chapters are somewhat lacking in coherence. The book’s final chapter, which examines the emergence of water scarcity as a source of political conflict in Spain, feels especially out of place. While water is unquestionably our most vital natural resource, the chapter clashes somewhat with the rest of the book’s focus on mineral resources. Moreover, the chapter’s authors (Ignacio Cazcarro, Rosa Duarte, Miguel Martín-Retortillo, and Ana Serrano) focus on the geographic and ecological dimensions of the issue, eschewing the macroeconomic perspective of the other essays. The book also suffers from the absence of a proper concluding chapter that could tie together several of the disparate insights offered by its contributors. These are, of course, minor drawbacks that do not take away from the quality of this highly informative and superbly crafted volume.

Natural Resources and Economic Growth is an authoritative text on one of the most vexing problems in development studies and a must read for academics, graduate students, and anybody interested the pivotal role that commodities play in the global economy.


Acemoglu, D., Johnson, S., and Robinson, J. A. 2000. “The Colonial Origins of Comparative Development: An Empirical Investigation” (No. w7771). National Bureau of Economic Research.

Auty, R. 2002. Sustaining Development in Mineral Economies: The Resource Curse Thesis. Routledge.

Sachs, J. D., and Warner, A. M.    1995. “Natural Resource Abundance and Economic Growth” (No. w5398). National Bureau of Economic Research.

Sachs, J. D., and Warner, A. M. 2001. “The Curse of Natural Resources.” European Economic Review, 45(4), 827-838.

Rahim Mohamed is a Ph.D. Student in Political Science at the University of North Carolina — Chapel Hill. He is broadly interested in development and governance issues surrounding natural resource wealth and is the author of “Unfinished Business: Reflections on Canada’s Economic Transformation and the Work Ahead,” The Independent Review (forthcoming).

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (December 2015). All EH.Net reviews are archived at

Subject(s):Agriculture, Natural Resources, and Extractive Industries
Economywide Country Studies and Comparative History
Government, Law and Regulation, Public Finance
Geographic Area(s):General, International, or Comparative
Time Period(s):19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

An Economic History of Early Modern India

Author(s):Roy, Tirthankar
Reviewer(s):Chaudhary, Latika

Published by EH.Net (December 2015)

Tirthankar Roy, An Economic History of Early Modern India. New York: Routledge, 2013. x + 174 pp. $53 (paperback), ISBN: 978-0-415-69064-5.

Reviewed for EH.Net by Latika Chaudhary, Graduate School of Business and Public Policy, Naval Postgraduate School.

The literature on Early Modern India is characterized by debates surrounding the decline of the Mughal Empire, the rise of the East India Company and the timing of when India fell behind Europe. Despite strong claims on each side, the evidence underlying the arguments is often weak because of insufficient or unreliable economic data. Against this backdrop Tirthankar Roy’s book is a welcome addition to the field. It offers a measured assessment of the salient transitions in this important period of Indian history beginning with the death of the Mughal Emperor Aurangzeb in 1707 and ending in the early 1800s as the English East India Company came to control large territories including most of coastal India.

Drawing on an impressive reading of the primary sources and secondary literature, Roy’s analysis moves away from traditional debates surrounding colonialism and draws cautious conclusions about urbanization, living standards and agrarian conditions. His main argument is that political turmoil at the top between the different warring factions led to a general decline in public goods but did not substantially weaken peasant property rights. In India, many people could claim the final agricultural output ranging from military nobles and tax collectors at the top to landlords in the middle and finally peasants cultivating the land at the bottom. While states needed more public money to fund wars, Roy argues they were limited in their ability to coerce peasants because land was abundant and labor was scarce in the eighteenth century. In support he points to qualitative evidence of peasant communities moving and clearing forest for cultivation across many Indian regions. The available evidence on living standards also matches this account of peasant property rights. Based on a careful reading of the economic trends, Roy argues that agricultural production, crop yields and standards of living did not fundamentally change over the long eighteenth century.

Roy begins by describing the process of state formation as new successor states wrestled power from the Mughal Empire in the first half of the eighteenth century. Success was contingent on the ability of these states to improvise old, or devise, new fiscal structures that could extract necessary revenues to support the military campaigns. By the end of the eighteenth entry, the English East India Company emerged victorious signaling a fundamental break. Unlike former states, the Company employed its own standing army relying less on earlier forms of military-agriculture relationships with landlords and tax collectors. By eliminating such middlemen, the Company made tax collection more efficient.

As a successor state, the East India Company was also special because of its strong naval presence. This contributed to the coastal shift in business as the Company transitioned to a colonial state. Overland trade within India declined over this period as maritime trade increased.  That said, maritime trade accounted for only a tiny share of the economy. Some groups with inland interests lost, while others that successfully transitioned to working with European firms gained. Roy argues that this change in orientation is also reflected in urbanization patterns. Agra, Delhi and Lahore among other interior towns of the Mughal Empire declined as the coastal towns of Bombay, Calcutta and Madras came to dominate the urban landscape. The latter were new industry hubs, which was as important in accounting for their rise as their status as colonial company towns. That said, there was no long run urbanization trend. Old centers of production tied to the Mughal Empire experienced decline but, this was balanced by the rise of Bombay, Calcutta and Madras.

This book has much to recommend itself. A newcomer to Indian economic history will appreciate the military-political history of the eighteenth century successor states, the nature of military-agriculture interactions and the organization of agricultural production.  The chapters on urbanization and living standards are among the best I have read on the topic. They summarize the existing debates, describe the data and then draw sensible conclusions while acknowledging gaps in the literature. While general histories may overlook regional patterns, Roy gives the regional stories their due importance. My only quibble is the book shortchanges the story of the East India Company despite its presence in many chapters. The rise of the Company and its transition to colonial power deserves more attention. This book tells the story up to the early nineteenth century, by when it is clear that the East India Company will be dominant. Roy takes up the rest of the story in The East India Company: The World’s Most Powerful Corporation (New Delhi: Allen Lane, 2012).

Latika Chaudhary is an Associate Professor of Economics at the Graduate School of Business and Public Policy at the Naval Postgraduate School. She has studied the provision of primary education and railways in colonial India. Her articles include “Determinants of Primary Schooling in British India” published in Journal of Economic History and “Regulation, Ownership and Costs: A Historical Perspective from Indian Railways” (with Dan Bogart) published in American Economic Journal: Economic Policy.

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Subject(s):Economywide Country Studies and Comparative History
Geographic Area(s):Asia
Time Period(s):18th Century
19th Century

Century of the Leisured Masses: Entertainment and the Transformation of Twentieth-Century America

Author(s):Surdam, David George
Reviewer(s):Hanssen, F. Andrew

Published by EH.Net (October 2015)

David George Surdam, Century of the Leisured Masses: Entertainment and the Transformation of Twentieth-Century America. New York: Oxford University Press. xviii + 305 pp. $99 (hardcover), ISBN: 978-0-19-021157-8.

Reviewed for EH.Net by F. Andrew Hanssen, Department of Economics, Clemson University.

Economist David Surdam takes on an enormous task: To explore what leisure is and how it has changed, both in conception and fact, over the last hundred years or so. He not only draws liberally on the work by his fellow economists, but copiously cites research and writings by sociologists, anthropologists, psychologists, and social commentators of various orders. For a scholar contemplating research in the field of leisure, the bibliography alone is worth the price of the book. Anecdotes abound, many tremendously interesting. The author is very good at explaining the economic issues, when economic issues arise.

The book’s biggest weakness is that the author makes no overarching argument and advances no particular thesis (despite a title inspired by Thorstein Veblen, Veblen’s work comes up only briefly, most interestingly in a preface by economist Ken McCormick). Rather, the author appears content to recount what others have said. This can yield gems: Many of the quotes from long forgotten books and articles are priceless (like the commentator addressing the worry about all those washing machines sitting around idle). But the result is a disjointed work. Topics appear and disappear, sometimes to reappear again and sometimes not. There is too much repetition.

The author begins in Chapter 1 with an attempt to define leisure, and returns to the task from time-to-time throughout the book. Leisure is voluntary, and presumably unpaid. But is unpaid, voluntary time in the classroom leisure? How about paid but well-enjoyed tennis matches? How about mowing the lawn on the weekend? And where do “unhealthy” activities, like drinking or drug taking, or consuming pornography fit in? Indeed, Surdam’s attempt to define leisure brings to mind Potter Stewart’s famous comment about pornography, with the difference that leisure is hard to know even when one when one sees it.

Chapter 2 examines changing attitudes towards leisure, a topic that provides some of the most entertaining anecdotes in the book. Or should I say, unchanging attitudes? It is clear that from the dawn of time (or at least from the early twentieth century) leisure has generated two pressing fears: 1) that the quantity of it is “wrong” (usually there is too much; occasionally there is too little), and, 2) that whatever leisure there is, it is being badly used. The consistency with which these two points come up is quite striking; whether talking about the working class and their nickelodeons, black Americans and their jazz clubs, or teenagers and their drive-ins (to name just a few), things are going to the dogs! The author trots out a number of predictably ponderous and very amusing quotes about the problem du jour. I’m going to stop worrying so much about my daughter’s iPad.

Chapter 3 provides a reasonably good discussion of the economics of leisure, and the effect of rising incomes on leisure taken, both in amount and form. In Chapter 4, the author describes how leisure has evolved over time. The perhaps unsurprising bottom line is that time taken for leisure has increased and leisure activities have become more varied. In Chapter 5, he reviews expenditure on leisure, using annual data from the Census Bureau. Not surprisingly, he finds that spending rose as the twentieth century progressed. His analysis of the changing mix of spending is mostly anecdotal. Chapter 6 is a somewhat rambling discussion that seeks to contrast the leisure activities of the young and the old. The chapter is a grab bag of topics that includes comic books, jazz and rock-and-roll, the “swinging bachelor” of 1950s fame, and the leisure activities of African Americans. (As always, the fear of badly used leisure rears its ugly head.) Chapter 7 looks at trends in public health, and appears only tangentially related to leisure. Chapter 8 contains a very interesting discussion of how jobs went from dirty and dangerous to clean and safe to downright pleasant. The discussion illustrates how hard it is to draw a bold line between work and leisure — as one bats a volleyball across a net with fellow employees on the campus of a Silicon Valley high tech firm, is one recreating or working? It would have been nice to see the author explore that line of argument more thoroughly; for example, do farmers have very little leisure — they are constantly busy — or a whole lot? (One might ask the same thing about economics professors as they conduct their research!)

Chapter 9 focuses on the household, and illustrates the book’s strength and weaknesses in microcosm. It has an interesting starting point: the change in technology, social mores and so forth that gave rise to a massive increase in female labor force participation. It provides an intelligent review of the labor-leisure tradeoff in the context of household work. It presents some basic data in tables, and discusses cogently empirical analyses conducted by a number of researchers, mostly economists. Descriptions of how arduous many household tasks were in former days are fascinating, and the discussion of technological advances that changed things is interesting. I particularly enjoyed the author’s recounting of the debate over whether women used the time freed up for more leisure or to expand the set of household “chores.” But since there is no overarching theme, and no particular argument being made, it is hard to say what it all adds up to.

Chapter 10 begins to address the industries of mass leisure. The author provides good brief histories of amusement parks, saloons and cabarets, music, and theater and vaudeville. But it once again has a grab-bag feel. A paragraph on radio is followed by a paragraph on phonographs is followed by a paragraph on 45 rpm records and rock-and-roll. Chapter 11 continues with movies, sports, radio, and television. Chapter 12 covers the rise of mass transport, electricity, automobiles, the suburbs, and air conditioning. Chapter 13 briefly discusses the role of government in the leisure business, while Chapter 14 reviews antitrust cases involving music, movies, television, and professional sports. Surdam ends with an epilogue, in which he recounts that — guess what? — people are worried about how leisure is being used! There is nothing new under the sun.

I found the book great fun to dip in and out of. For example, in writing this review, I opened the book at five random points, and came up with: 1) a discussion of the “affable” Puritans; 2) Thomas Sowell’s views on acculturation; 3) the recounted astonishment of a 1959 Life magazine journalist who discovers that “the amount spent on dogs is equal to all the salaries and fees paid on legal services”; 4) a discussion of nineteenth century rag pickers; and 5) a description of how Vaudeville houses were established along newly developing New York City subway lines. (The thing I enjoyed most was reading again and again how one set of people deplored another set’s use of leisure.)

As enjoyable as all this is, because it lacks an organizing thesis, the book becomes, for the most part, a recounting of a lot of “stuff.” Thus, as a volume to browse for entertainment, I recommend it. For its terrific bibliography of work on leisure in myriad fields, I heartily endorse it. But as a means to understand mass leisure in the twentieth century, unfortunately, it comes up a bit short.

F. Andrew Hanssen’s publications include “Explaining Changes in Organizational Form: The Case of Professional Baseball” (with J. Meehan and T. Miceli), Journal of Sports Economics (forthcoming) and “Vertical Integration during the Hollywood Studio Era,” Journal of Law and Economics (2010).

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (October 2015). All EH.Net reviews are archived at

Subject(s):Household, Family and Consumer History
Social and Cultural History, including Race, Ethnicity and Gender
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII

Cultivating Success in the South: Farm Households in the Postbellum Era

Author(s):Ferleger, Louis A.
Metz, John D.
Reviewer(s):Harris, J. William

Published by EH.Net (September 2015)

Louis A. Ferleger and John D. Metz, Cultivating Success in the South: Farm Households in the Postbellum Era. New York: Cambridge University Press, 2014.  xiii + 206 pp. $90 (cloth), ISBN: 978-1-107-05411-0.

Reviewed for EH.Net by J. William Harris, Department of History, University of New Hampshire.

Cultivating Success in the South offers an illuminating examination of the South’s post-Civil War cotton economy.  Most of the important scholarship on that subject focuses on the momentous change from slave-based plantations to tenant/sharecropping plantations, and to the place of African Americans on those postwar plantations.  Economic historians have made use of macroeconomic data and samples from the agricultural censuses to analyze, and sometimes argue over, the roles of racial discrimination, credit and debt, technical changes such as fertilizer use, and cotton prices in shaping the postwar cotton regime.

Louis A. Ferleger (Boston University) and John D. Metz (Library of Virginia) address this subject in a study of three agricultural counties in Georgia from 1880 to 1910.  Crawford and Jasper are in the lower Piedmont, where cotton was king and a large majority of white households included slaveholders in 1860.  Franklin, in the upper Piedmont, had a shorter growing season, with smaller farms growing less cotton and more grains, and many fewer slaves; just one out of six households included slaves in 1860.

The authors’ contributions are two-fold.  The first is methodological: their systematic use of probate records to analyze patterns in both production and consumption on farms. The main evidence comes from a sample of 228 estates from the three counties between 1880 and 1910, with data on decedents cross-checked in the records of the 1880, 1900, or 1910 censuses.  Probate records have been used with great profit by economic historians of colonial America, but rarely for more recent times, and never for the postwar South, at least in this systematic fashion.  The authors’ meticulous analysis of the probate inventories supports their contention that their study “calls into question the long-standing notion of an impoverished postbellum South characterized by a stagnating economy, political turmoil, and racial tension” p. (4). (They do not address either politics or racial tension, although one of the counties was stronghold of Populism, and in two of them black men were lynched in these years.)

The second innovation, directly related to the methodology, is in subject matter.  Estates worth less than $500 did not go through probate, and wealthy property owners usually avoided probate by writing wills.  The sample is thus overwhelmingly made up of “yeoman” farmers, 88 percent of them white men, who owned small and medium-sized farms.  While this obviously leaves out much of the farming population, it is arguable that we know less about white small farmers than any other major group in the postwar South, even though most of the increase in cotton production in these years took place on small farms owned by whites.

The key findings come from analysis of 199 probate inventories with enough detail to show, most often with simple cross-tabulations and means, not only general patterns of production and consumption, but also quite specific information on the types of tools used and items purchased for household use.  The findings with respect to production are often interesting but rarely surprising.  Franklin County’s farmers, thanks to fertilizer and improved transportation, moved firmly into cotton monoculture, but in all three counties, production patterns and tool use indicate a cautious, safety-first emphasis on “how to achieve self-sufficiency without assuming a dangerous level of risk” (p. 91). Home production of food, diversification into alternate marketable crops, and the taking up of secondary occupations like blacksmithing helped to reduce risk.  With increasing farm size, farmers purchased specialized plows and cultivators, cotton gins, and even steam engines.  Inventories for African Americans and women are too few in number for a full analysis, but the limited data do suggest that those farm owners were not greatly different in their patterns of purchases.  The authors conclude that, overall, farmers “showed creativity and persistence in trying to improve their lot in life” (p. 180).

The analysis of consumption offers fresh information on a little-studied subject.  The most important conclusion is that yeoman farmer households participated fully in the growing consumer economy, although the authors go too far in claiming that the rural economy was “every bit as dynamic as the urban model characterized by increased consumption” (p. 95). Farmers and their wives were “shrewd if conservative consumers” (p. 175) for whom “the practical superseded the niceties” (p. 179).  Half of the families owned stoves, and many purchased sewing machines, coffee mills, and other labor-saving products.  At higher levels of wealth they owned pianos, organs, clocks, and furniture suitable for a parlor.  The authors point out that estate auctions were alternatives to country stores and mail-order catalogues as a source for purchases, at a discount, of tools and consumer items.

Readers should be aware that there are occasional errors in the text.  For example, the authors write that “blacks comprised one-fifth” of Georgia’s population in 1850, when the actual proportion was more than two-fifths.  Tables on pages 48 and 49 indicate that the Crawford County sample included 51 white males, 4 black males, and 5 females, but only 56 cases in total.  More problematic is the broad claim that “middling farmers who owned their property … accounted for the majority of the population,” and that “owner-operators outnumbered renters by at least two to one” (p. 15). This is simply untrue over the thirty-year period.  According to the Census of Agriculture for 1900, there were in these three counties 1,762 white farm owners or part-owners, and 2,257 white cash or share tenants.  If black farmers are included, tenants outnumbered owners overall by more than two-to-one, not the other way around.  Indeed the presence of so many tenants points to the biggest limitation of the study, in that the analysis of production is mainly limited to mules, tools, and other capital inputs, with no discussion of labor arrangements or of the relationships between labor arrangements and the use of technology.

Still, the authors’ meticulous examination of a new (for this period) source for the study of the rural southern economy deserves praise.  It may be that their demonstration of the value of probate records, more than their specific conclusions, proves to be their most influential contribution.

J. William Harris ( is Professor of History at the University of New Hampshire.  He is currently writing a general history of the South since the Civil War.

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (September 2015). All EH.Net reviews are archived at

Subject(s):Agriculture, Natural Resources, and Extractive Industries
Living Standards, Anthropometric History, Economic Anthropology
Geographic Area(s):North America
Time Period(s):19th Century
20th Century: Pre WWII

The Merchant Republics: Amsterdam, Antwerp, and Hamburg, 1648-1790

Author(s):Lindemann, Mary
Reviewer(s):Ryckbosch, Wouter

Published by EH.Net (September 2015)

Mary Lindemann, The Merchant Republics: Amsterdam, Antwerp, and Hamburg, 1648-1790. Cambridge: Cambridge University Press, 2014. xv + 356 pp. $99 (hardback), ISBN: 978-1-107-07443-9.

Reviewed for EH.Net by Wouter Ryckbosch, Centre for Urban History, University of Antwerp.

Although few would deny the importance of Northern Germany or the Low Countries to the economic history of early modern Europe, we know relatively little about the self-perceptions that reigned in these places, the political ideas that circulated, or the political economies that governed them. Compared to the libraries that have been written on Florence, Paris or London, the list of works dealing with the politics and ideas of the North-West European cities is rather short. It is this gap that Mary Lindemann ( Professor of History at the University of Miami) aims to fill with The Merchant Republics. The book focuses on three major port cities in the long eighteenth century (roughly from 1648 to the 1790s): Antwerp, Amsterdam and Hamburg.

All three towns were — to rather varying degrees — important commercial centers during this period, as well as “republics.” In this book, a republic is understood as “a political entity governed by citizens who assumed the task of administration as part of the civic and political duties incumbent on them.” Moreover, according to Lindemann all three cities were specifically “merchant republics,” in the sense that they considered merchants and mercantile values as essential components of their republicanism. Starting out from this loose but nevertheless informative definition, Lindemann explores the similarities and differences (both of which are numerous) in the political economy of the three cities.

After a first chapter that presents a general introduction to the three cities under scrutiny, the second and third chapters examine the structures of government and the political ideas surrounding them. The political issues that dominated the agenda were very different in all three cities: Amsterdam was characterized by conflicts between the party of the stadhouder and the party of true freedom; Hamburg was marred by recurrent disagreements between the Bürgershaft and the Senate; and in Antwerp the opposition of the ruling elites to centralization from the monarchical rulers in Brussels/Madrid/Vienna proved the dominant theme. Nevertheless, Lindemann makes a convincing argument that in all three there existed a general self-perception of republicanism — which at the very least implied an opposition to monarchical political structures, even if that did not preclude these urban elites from demonstrating strong aristocratic and oligarchic tendencies, or from preaching civic virtue while being plagued by corruption.

Chapters 4, 5 and 6 shift attention towards the mercantile aspect of these “merchant republics,” considering how the (upper crust of) these cities’ inhabitants perceived themselves and their values as opposed to aristocratic and monarchical societies. This includes a very illuminating segment on the problems presented by “impostors” and how these were perceived as antithetical to mercantile and republican values, as well as chapters on the problems posed to republican virtues by speculation and bankruptcy. To scholars interested in the history of economic thought these latter two chapters will be of most interest, as they lend themselves most easily to comparisons with the extensive literature on the republican tradition and the development of enlightenment mentalities on commerce, virtue and the common weal elsewhere.

Unlike much scholarly work on the republication tradition, political self-representation, or early modern economic thought, Lindemann does not limit herself to studying only the most well-known authors and publications of the time, but instead delves into a wonderfully rich variety of pamphlets, court cases, and political commentaries to substantiate her arguments. Admittedly, Antwerp, Amsterdam and Hamburg did not bring forth political commentators of the same renown as Machiavelli, Mandeville or Montesquieu (with the possible exception of Amsterdam’s Pieter de la Court), but the wide range of sources on which Lindemann draws her story is nevertheless impressive. To be sure, this can at times be overwhelming. The number of protagonists that crowds the pages, as well as the three different political structures with their specific terminologies in which they figured, does not always make for light reading.

The title of the book does not simply describe the common features of the three cities studied. It also advances a specific historical interpretation (p. 310). What The Merchant Republics, in all its nuance and complexity, argues is that in the commercial ports of north-western Europe a peculiar republicanism developed that was compatible with a highly commercial society (quite contrary to Pocock’s classical republicanism), and that celebrated trade and merchants for their republican virtues. As valuable and generally convincing as this interpretation is, it also raises many questions, some of which unfortunately remain unanswered in the book.

To begin with, the structure of the book presents plenty of comparison between three merchant republics — and thus highlights the large potential for variety within this concept — but the overarching argument actually seems to call for comparison between these merchant republics as a whole, and the political economies of other “republicanisms” throughout the classical, early modern and modern world. In the end, I could not help wondering how the political economy of these merchant republicans differed from that of Machiavelli and quattrocento Florence. And how does it compare to enlightenment economic thought across the channel, and Adam Smith in particular? Most of all, perhaps, the argument invites comparison with the French tradition of assessing the virtue in commerce, including Montesquieu and the concept of “le doux commerce.”

Despite the wide range of sources on which the book draws, most of the voices heard throughout belonged to the (mercantile) upper crust of these cities. This raises the question whether the self-image of a merchant republic was limited to the mercantile community alone, or whether it did indeed encompass the whole town. Although Lindemann pays plenty of attention to dissent and conflict within the ruling classes, there’s relatively little attention to conflict between the mercantile groups and those who had been only relatively recently excluded from political power (at least in Antwerp and, to a lesser extent, Amsterdam): the middling groups, and the craft guilds in particular. After all, in sixteenth-century Antwerp the Chambers of Rhetoric only embraced a more positive view of commerce after merchant-entrepreneurs had wrested political power from the craft guilds.  It is perhaps ironic that they did so with the support of their monarchical overlord, which makes one wonder if the “mercantile” and “republican” components of the book’s argument were everywhere and always as closely tied to one another as Lindemann suggests.

The applicability of the term “merchant republic” to this or that city and this or that timeframe can be endlessly debated, but Lindemann shows that as a conceptual framework for understanding politics, self-representation and economic thought in eighteenth-century North-Western Europe it has clear value. Moreover, as a historical interpretation it serves as a useful reminder that both “republicanism” and “mercantile mentalities” could take many forms in early modern Europe. However, first and foremost this volume is a rich and erudite account of political economy in three different stages of success and decline in merchant capitalism.

Wouter Ryckbosch is a postdoctoral researcher at the Centre for Urban History, University of Antwerp. He specializes in the histories of inequality and consumption in the early modern period, with a particular focus on the Low Countries in the eighteenth century.

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (September 2015). All EH.Net reviews are archived at

Subject(s):Economywide Country Studies and Comparative History
Geographic Area(s):Europe
Time Period(s):17th Century
18th Century

Lois Green Carr

Lois Green Carr, preeminent historian of colonial Maryland, died peacefully at her home on June 28, 2015.

She was 93 years of age.

Lois Green Carr (192-2015)Born on March 7, 1922 in Holyoke, Massachusetts to Donald Ross Green and Constance McLaughlin Green, Dr. Carr was a third-generation historian. She may be the only seven-year-old to have asked her mother to explain the medieval feudal system, an early hint of her lifelong intellectual curiosity. After graduating from Swarthmore College in 1943, Dr. Carr obtained her M.A. from Radcliffe College in 1944. In 1968 she earned her Ph.D. in History from Harvard, with her dissertation County Government in Maryland, perhaps the lengthiest (more than a thousand typed pages) and most detailed study of local colonial government.

After moving to Annapolis in 1954, Dr. Carr joined the Hall of Records (now Maryland State Archives) staff as a junior archivist in 1956. In 1967 she became Historian for Historic St. Mary’s City (HSMC), a position she retained for 45 years. She continued to work primarily at the state archives where she had ready access to the documentary records vital to her research. Her great passions were historical research and public history. She saw St. Mary’s City as her classroom, where the public could learn about the past by experiencing it in new ways. Dr. Carr founded the research program at HSMC; participated in the development of every exhibit at the museum, including numerous seventeenth-century reconstructions; and provided the key historical evidence for identifying the Calvert family members buried in lead coffins discovered under the 1660s Brick Chapel. Of them all, she perhaps had the greatest role in creating the Godiah Spray Tobacco Plantation, directly based on the research later published as Robert Cole’s World.

Internationally recognized as one of the leading social and economic historians of the colonial Chesapeake region, Dr. Carr co-authored and contributed to numerous books, articles, and papers, including Robert Cole’s World: Agriculture & Society in Early Maryland; Maryland’s Revolution of Government 1689-1692; Colonial Chesapeake Society; and Maryland: A New Guide to the Old Line State. She attended and participated in many conferences and symposiums in the fields of colonial social and economic history. As HSMC’s first historian, in support of the programming needs of an ambitious young museum, Dr. Carr undertook original research on a broader range of subjects than professional historians typically address. She believed that public history museums should offer interpretations adhering to the same high standards for quality and originality as leading academic institutions. As a result, a number of the research reports she produced for HSMC became the basis for books and articles making major contributions to the fields of political, social, economic, and women’s history.

Although modest about her own achievements, Dr. Carr was widely recognized and admired by her colleagues. She was president of the Economic History Association in 1990-1991. In 1992 a conference in her honor, held at the University of Maryland at College Park, brought together leading colonial scholars whom she had known and worked with during her career. The HSMC awarded Dr. Carr its highest award, the cross bottony,[1] in 1995 and she was one of the first two recipients in 1996 of the Maryland Humanities Council’s Eisenberg Prize for Excellence in the Humanities. In 2000, Dr. Carr was inducted into the Maryland Women’s Hall of Fame and in 2001 she received an honorary degree from St. Mary’s College of Maryland. Her co-authored volume Robert Cole’s World received numerous awards. Today, many of the articles and books she helped produce remain essential reading for all scholars of early American history.

Dr. Carr’s intellectual creativity and enthusiasm attracted numerous young researchers to the study of colonial Maryland history, a group often characterized as the “Maryland Mafia,” with Dr. Carr as its godmother. Her passion was to write and teach history for a broad public audience through museum programs rather than in an academic institution, but through her generous mentoring of dozens of younger scholars, Dr. Carr played a major role in shaping research, writing, teaching, and interpreting the history of the region. Many scholars owe her an immense debt for her invaluable advice on all stages of a project from research design to polishing a final manuscript. A demanding critic, Dr. Carr pushed scholars to aspire to high levels of achievement.

She was a pioneer in the field of colonial history, especially in the use of probate records to reveal the contours of the lives of ordinary as well as prominent people of the past. Her research approach—integrating archival history with archaeology and architecture—was considered novel at the time. And she was in the forefront of using computers to manage and analyze large amounts of historical data. Dr. Carr designed and directed several long-term team history research projects which won support from the National Science Foundation and from the National Endowment for the Humanities. One notable product of the work undertaken for HSMC by Dr. Carr and her project colleagues is the career file that documents every known seventeenth-century St. Mary’s resident, part of the research files maintained among the collections of the Maryland State Archives and HSMC.

Dr. Carr served as a Senior Adjunct Scholar at the Archives from 1988 until 2005. In 1989, she assumed the position of Senior Historian of the Maryland Historic Trust, continuing to focus her work on St. Mary’s City, an activity she sustained even after her retirement in November 2005. She was an adjunct professor of history at the University of Maryland College Park from 1982 until her retirement, and was a visiting professor at St. Mary’s College of Maryland in 1971.

In addition to her passion for history, Dr. Carr loved her Quarter Landing neighborhood, listening to classical music, gardening, cooking, entertaining guests, and participating in a play-reading group with her husband, Jack Ladd Carr, who preceded her in death in 2010. The couple regularly attended Annapolis Symphony Orchestra concerts and Colonial Players productions. Visiting colleagues always received a warm welcome at her home and Annapolis friends gathered at her annual Christmas party.

Dr. Carr was also preceded in death by her brother, Donald Ross Green, and her sister, Elizabeth Langford Green. She is survived by her only child, Andrew Clark, of Baltimore, Maryland; a nephew, Mitchell Green, of Washington State; and a niece, Alice Green, of California. She leaves behind many friends and colleagues who loved, respected, and admired her for the work that contributed so much to our understanding of early Maryland.

Memorial Services celebrating her life will take place at two locations. There will be a service at 4 pm on September 19 at the reconstruction Brick Chapel at Historic St. Mary’s City with a reception following at the 1676 State House. Tours will be offered prior to the service at St. Mary’s City of the various exhibit sites Dr. Carr played a major role in interpreting. A second Memorial Service will be held in Annapolis at 1 pm on September 20 at the Maryland State Archives. In lieu of flowers, contributions may be made to the Friends of the Maryland State Archives, (350 Rowe Boulevard, Annapolis, Maryland, 21401) or to the Carr Fund at the Historic St. Mary’s City Foundation (P.O. Box 24, St. Mary’s City, 20686) for support of the plantation exhibits directly based on Dr. Carr’s scholarship in Robert Cole’s World.

[1] A “cross bottony” is a cross having each arm terminating in three rounded lobes, forming a sort of trefoil. From the religious point of view, the cross bottony can be used as a symbol of the Christian Trinity. A cross bottony which is heraldically “counterchanged” occurs on the flag of Maryland.

Strained Relations: U.S. Foreign-Exchange Operations and Monetary Policy in the Twentieth Century

Author(s):Bordo, Michael D.
Humpage, Owen F.
Schwartz, Anna J.
Reviewer(s):Edison, Hali J.

Published by EH.Net (August 2015)

Michael D. Bordo, Owen F. Humpage and Anna J. Schwartz, Strained Relations: U.S. Foreign-Exchange Operations and Monetary Policy in the Twentieth Century.  Chicago: University of Chicago Press, 2015. x + 442 pp. $97.50 (cloth), ISBN: 978-0-226-05148-2.

Reviewed for EH.Net by Hali J. Edison, International Monetary Fund.

This book is clearly destined to become a classic, leaving a mark on future research on foreign-exchange operations. In 1990, Michael Bordo (Rutgers University and NBER) and Anna Schwartz (NBER) began their collaboration to document the evolution of U.S. intervention. Ten years later, Owen Humpage of the Federal Reserve Bank of Cleveland joined the team. Regrettably, in 2012, before the book was finalized Anna Schwartz passed away.

The book explores the evolution of foreign-exchange intervention in the United States in the twentieth century. During this period, the United States transitioned from participating in the international gold standard regime to fixed exchange rates (“dollar standard”) and finally to a regime of floating exchange rates. Policymakers around the world during this period grappled with the choice of exchange rate regime, the role of monetary policy, and international capital mobility — often referred to as the trilemma. The book traces the changes in U.S. institutional arrangements and policymakers’ thinking to the economic and political events drawing extensively from Federal Reserve documents.

Chapter 1 lays out the plan of the book. It starts by describing how attitudes about foreign-exchange intervention and monetary policy evolved over the decades and how this was eventually reflected in theories of intervention and institutional arrangements.

Chapter 2 explains that the model for modern foreign-exchange-market operations can be linked to the operations under the gold standard. The authors argue that the historical evolution of exchange-market operations before 1934 yields important insights into understanding modern-day practices. For instance, the chapter illustrates early uses of secrecy, sterilization, and forward transactions, all of which became important methods of modern intervention.

The creation of the Exchange Stabilization Fund (ESF) in the United States is described in Chapter 3. This chapter was written by Anna Schwartz and maintains the same rich details as contained in her 1963 seminal book with Milton Friedman, A Monetary History of the United States, 1867-1960. It clarifies the role of the ESF and elaborates on the institutional arrangements. Two key features of the ESF are that it is under exclusive control of the U.S. Secretary of the Treasury and is self-financing, such that ESF funding is outside of the congressional appropriation process.

After outlining the background of the institutional arrangements, chapters 4 through 6 discuss the evolution of U.S. foreign-exchange operations since the end of World War II. Each of the chapters captures a distinct episode, describing the economic and political developments and the evolution of institutional arrangements. Chapters 5 and 6 also evaluate the effectiveness of U.S. intervention, drawing heavily from the methodology laid out in research conducted by the authors.

Chapter 4 focuses on the Bretton Woods era from 1944 to 1973. During this period countries attempted to maintain par values for their currencies, promote free cross-border financial flows, and achieve domestic macroeconomic objectives such as full employment. Intervention was one of the policy instruments used to achieve these objectives. According to the authors, intervention may have been successful in the sense that it delayed the disintegration of the Bretton Woods system but it did not fix the problem: Current account surplus countries did not want to undermine their domestic macroeconomic objectives to maintain fixed exchange rates.

Chapter 5 covers the foreign-exchange-market operations during the early float period (1973 to 1981). On March 12, 1973, the Bretton Woods era fixed-exchange-rate system ended. During much of the period, policymakers viewed that foreign-exchange markets were subject to bouts of disorder, requiring intervention to direct the exchange rate along a path they viewed consistent with their domestic policy objectives. The chapter describes the evolution of the institutional arrangement, including the Federal Reserve’s swap line with the U.S. Treasury, known as the warehousing facility.

Chapter 6 considers the currency operations and the ongoing debates during the Volcker and Greenspan era (1981 to 1997). Early in the period, between 1981 and 1985, the U.S. adopted a minimalist approach that was spearheaded by the U.S. Treasury. As the dollar strengthened in 1985, the United States assumed an activist approach, intervening frequently. The chapter includes details of the 1983 Jurgensen Report, commissioned by G7 officials to study intervention. In addition, it provides a rich discussion of the 1989-1990 conversation within the Federal Reserve of its involvement in U.S. intervention operations, partly reflecting the report from a staff Task Force on System Foreign Exchange Operations. The United States essentially stopped intervening in the mid-1990s, but has never officially ruled out intervention.

Overall, this book describes the evolution of U.S. policy regarding currency-market interventions, the institutional arrangements, and the interaction of currency-market policy with monetary policy. It documents how U.S. intervention and exchange rate policy changed over time, reflecting a learning process. The work leaves open many interesting doors for more analysis that could and should engage future scholars.

Hali J. Edison (, International Monetary Fund, is author of The Effectiveness of Central-Bank Intervention: A Survey of the Literature after 1982 (Special Papers in International Economics, Princeton University Press).

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (August 2015). All EH.Net reviews are archived at

Subject(s):Financial Markets, Financial Institutions, and Monetary History
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

Institutions, Innovation, and Industrialization: Essays in Economic History and Development

Editor(s):Greif, Avner
Kiesling, Lynne
Nye, John V. C.
Reviewer(s):Margo, Robert A.

Published by EH.Net (May 2015)

Avner Greif, Lynne Kiesling, and John V. C. Nye, editors, Institutions, Innovation, and Industrialization: Essays in Economic History and Development.  Princeton, NJ: Princeton University Press, 2015. v + 430 pp.  $49.50 (cloth), ISBN: 978-0-691-15734-4.

Reviewed for EH.Net by Robert A. Margo, Department of Economics, Boston University.

Although it would be difficult to prove conclusively I believe the level of social capital in the economic history profession is very high, absolutely and relative to other fields in economics.  Because the field is small, new entrants are quickly integrated into the fold.   Senior scholars take their mentoring responsibilities seriously, and not just to their own students.  On the back end, there is a very strong tradition of Festschriften, the formal honoring of distinguished individuals by research conferences and requisite commemorative volumes.   For economic historians who have produced many more successful PhDs in their career than the average number of chapters in an edited volume, the decision of whom to include in the published Festschrift (as opposed to the conference) is a delicate challenge.   As the co-editors note in their introductory remarks, this certainly was the case with the volume under review, honoring as it does Joel Mokyr, one of our most prodigious scholars and certainly one of the most prolific in replenishing the profession with new PhDs over the past several decades.  The co-editors are all well-known Mokyr students.  Avner Grief is the Bowman Family Endowed Professor in Humanities and Sciences at Stanford University; Lynne Kiesling is Associate Professor of Instruction in the Department of Economics at Northwestern University; and John V. C. Nye is the Frederic Bastiat Chair in Political Economy and Professor of Economics at George Mason University.

The book is divided into four sections.  The first without title or number presents the co-editors’ introductory remarks; and two chapters, one by Cormac Ó Gráda (“Neither Feast nor Famine: England before the Industrial Revolution”) and a second by Joel Mokyr (“Progress, Useful Knowledge, and the Origins of the Industrial Revolution”).  The second section (“Institutions”) contains four chapters by Grief (“Coercion and Exchange: How did Markets Evolve?”); Gergely Baics (“Meat Consumption in Nineteenth Century New York:  Quantity, Distribution, and Quality, or Notes on the ‘Antebellum Puzzle’”; Mauricio Drelichman and Hans-Joachim Voth (“Funding Empire: Risk, Diversification, and the Underwriting of Early Modern Sovereign Loans”); and Noel D. Johnson, Mark Koyama, and Nye (“Establishing a New Order: The Growth of the State and the Decline of Witch Trials in France”).   The third, (“Innovation”) has four chapters by Fabbio Braggion, Narly R.D. Dwarkasing, and Lyndon Moore (“Increasing Market Concentration in British Banking, 1885 to 1925”); Peter B. Meyer (“The Catapult of Riches: The Airplane as a Creative Macroinvention”); Karine van der Beck (“England’s Eighteenth Century Demand for High-Quality Worksmanship: Evidence from Apprentice, 1710-1770”); and Rick Szostak (“A Growth Agenda for Economic History”).  The fourth and final section (“Industrial Revolution”) is the longest with five chapters by Hoyt Bleakley, Louis Cain, and Joseph Ferrie (“Amidst Poverty and Prejudice: Black and Irish Civil War Veterans”); Ralf R. Meisenzahl (“How Britain Lost its Competitive Edge: Competence in the Second Industrial Revolution”); Carolyn Tuttle and Simone A. Wegge (“Regulating Child Labor: The European Experience”); Joyce Burnette (“Decomposing the Wage Gap: Within- and Between-Occupation Gender Wage Gaps at a Nineteenth Century Textile Firm”); and Eric Jones (“The Context of English Industrialization.”   Most of the authors are former doctoral students of Mokyr; others are long-time colleagues or professional associates (Cain, Jones, Ferrie).

Due to the eclectic nature of the book and space constraints being what they are, I shall hit the highlights as I see them and make some general observations.  Joel Mokyr’s chapter is a very effective summary of a forthcoming Princeton University Press book on the question near and dear to his heart: Why England? The Baics chapter provides an abundance of fresh quantitative data on the “antebellum puzzle,” showing that meat consumption appears to have declined in New York City in the late 1830s and early 1840s.  Karine van der Beek creatively uses archival records of apprentices subject to the stamp tax to study how the demand for certain types of skilled labor changed during the Industrial Revolution.   The Bleakley, Cain and Ferrie chapter uses unique data from the Early Indicators project collected by Mokyr’s cross-town colleague, the late Robert Fogel, to provide new insights into economic mobility experienced by Civil War veterans, by race and ethnicity.

The blurbs on the back cover of the book tout the “cutting-edge” (Harold James) and “pioneering and provocative” (Stephen Haber) nature of the chapters, but that is not how I see them for the most part.  As practiced today in the United States economic history is mostly indistinguishable in style and technique from other branches of applied economics.   Absent a few passing references to game theory here and there, and some simple algebra in Peter Meyer’s chapter, there is no formal modeling in this book.  When on display (and not often) the econometrics would be right at home in any 1980s issue of Explorations in Economic History.  There is some unevenness in substance and execution across the chapters, not uncommon in Festschrift.  I could have done without the Szostak chapter and its unnecessary eleven-step “program” of recommended behavior for today’s economic historians (“Focus on economic growth.  Focus some more.”)  It reminded me of sterile debates over the “New Economic History” that consumed far too much time (and journal space) back in the 1960s and 1970s and which are irrelevant today, in my personal experience.

What the essays do possess collectively is a studied, patient eye for historical context and clarity of exposition that has always been part and parcel of Joel Mokyr’s work, traits that he has most effectively transmitted to his students.   There is also an abundance of deep respect and affection for the dedicatee that shines through in every chapter.   Social capital runs very high in the Mokyr extended family, as this volume effectively demonstrates.

Robert A. Margo is the current President of the Economic History Association.  His most recent books are Human Capital and History: The American Record (co-edited with Leah Boustan and Carola Frydman) and Enterprising America: Businesses, Banks and Credit Markets in Historical Perspective (co-edited with William Collins), both published by the University of Chicago Press.

Copyright (c) 2015 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (May 2015). All EH.Net reviews are archived at

Subject(s):Development of the Economic History Discipline: Historiography; Sources and Methods
Economic Development, Growth, and Aggregate Productivity
Economywide Country Studies and Comparative History
History of Technology, including Technological Change
Labor and Employment History
Markets and Institutions
Geographic Area(s):General, International, or Comparative
Time Period(s):General or Comparative
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII