Mastering the Market: The State and the Grain Trade in Northern France, 1700-1860

Judith A. Miller, Mastering the Market: The State and the Grain Trade in

Northern France, 1700-1860. New York: Cambridge University Press, 1999.

xviii + 334 pp. $49.95 (cloth), ISBN: 0-521-62129-1.

Review by for EH.NET by Jonathan J. Liebowitz, Department of History,

University of Massachusetts Lowell.

Authorities in eighteenth and early nineteenth century France faced a dilemma:

How to keep the peace in the face of severe shortages of grain.

Harvest failure regularly (Miller finds nine incidents in the eighteenth

century) threatened consumers, who relied on a pound of bread a day for their

sustenance. Yet if the government acted to help them through price controls or

grain imports, it risked worsening the situation by provoking producers and

merchants to withdraw from the market.

Judith A. Miller (Department of History, Emory University) provides a

fascinating account of the State’s role in the grain trade as she reconstructs

the activities of local and national officials who sought to master the

treacherous market. She sympathizes with the plight of these officials as they

handled their next-to-impossible task. Miller’s theme is the growing success

they had in ‘mastering the market’ and bringing famine under control. Their

trial and error led them to conclude that too much government interference was

counterproductive but that a policy of total hands off would not be effective

either.

Miller sets the stage by contrasting the failure of the state in the shortage

of 1709 with its effectiveness in that of 1 853. The goal of the rest of the

book is to show how the French government moved from the first to the second.

Miller emphasizes the role of the state because, whatever ideologues may have

wished, it could not stay out of the market. The region of study extends from

Paris to the Channel, with Miller stressing the competition between Paris and

Rouen, its Norman rival. The major sources are administrative archives, from

which she gathers information about the administrators’ goals and actions.

During the eighteenth century, down to 1789, under the influence of both

experience and the free trade movement, strategies moved toward influencing

supply and demand, rather than forcing particular actions on participants.

Part of the problem was that the grain trade was not only uncertain, but

highly regulated. Officially grain had to be sold in public markets, though

large buyers and sellers preferred to deal with each other privately. While

grain prices might fluctuate freely, bread prices, the focus of consumers’

concerns, had long been set by local authorities. They varied with the grain

prices, but, as Miller shows us, even the officials assumed that, as prices

rose, bakers would suffer a loss.

In the mid-eighteenth century the government found that its entry

into the market led to two major problems: owners (merchants and producers)

left the trade when they were undersold and treasuries suffered heavy losses

from selling at low prices. From their experience with this dilemma officials

worked out the tactics

called “simulated sales.” Their policy was to sell grain, but quietly and with

market-mimicking procedures, supporting the market rather than supplanting it.

With the influence of free trade ideas, price setting began to be abandoned in

the 1760s and 1770s. Turgot and officials like him hoped that with higher

prices, grain would become abundant. But that didn’t happen, and practicing

officials still had to intervene on behalf of buyers. Now they were guided by

the principles of “no forced sales, no set

prices.”(85) They continued to use the skill they had developed through long

experience to guide the market

The Revolution is usually at the heart of any discussion of grain prices in

France. Miller, however, treats it as essentially an interruption in the long

process of mastering the market. Eliminating the former authorities, who knew

what they doing, the upheaval brought in new ones, who had to go through a

long period of learning. In their efforts to secure food for the

cities and now for the revolutionary armies as well, officials adopted radical

policies like requisitions, public markets, and set prices (the maximum). Once

again, force did not work, whether because there just wasn’t enough grain or

because owners would not supply it at the fixed prices.

(Miller leans to the former conclusion.) Turmoil ensued and was only ended when

Napoleon, seeking practical solutions, returned to the pre-Revolutionary

policies of secrecy and planning in advance for possible shortages. The last

gasp of “radical measures”(226) like maximums and requisitions was the

shortage of 1812, when they proved to be disastrous.

At this point the Napoleonic prefects returned to the “well-organized,

finely tuned strategies”(233) that were in line with their predecessors’ as

well as those who followed them. The thrust of policy during the Restoration

and July Monarchy (1815-48) was toward lessening government controls and

relying on private business. The Parisian grain reserve that had been

instituted under

Napoleon was phased

out, but bakers were required to maintain their own stocks. Bread prices were

fixed, but the number of bakeries was limited to guarantee a profit. Slowly

controls were relaxed.

By the late nineteenth century the machinery was working well. Grain prices

still fluctuated, but arrangements had been worked out to provide stability.

The

state had created a framework for the trade and could step back and let it

operate on its own. Free trade (even then, not yet complete) had arrived but,

paradoxically, only through state involvement.

What can we learn from Miller’s tale – a narrative that is not flamboyant but,

like her officials, careful and painstaking, instructing its readers about many

things in many ways? Her main theme is that both the market and state

intervention were dangerous. Unfettered, they would lead to hunger and turmoil,

but the market could teach the state to limit its action and the state could

tame the market, calming its destructive tendencies.

Miller’s conclusions have implications for other questions. She supports the

argument that free markets (or free enterprise in general) do not result from

the absence of government intervention but from government shaping the rules

and structures that govern economic activity. She also reaffirms the

continuities in French history (particularly that of State intervention in the

economy) that overwhelm the disruptive upheavals of events like the Revolution.

Although Mastering the Market is neither cliometrics nor new

institutional

economic history;

it does have a lot to teach all economic historians.

Jonathan Liebowitz is the author of articles on draft animals and land tenure.

He is working on a study of the impact of the crisis of the late nineteenth

century on French tenants and sharecroppers.