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Europe’s Growth Champion: Insights from the Economic Rise of Poland

Author(s):Piatkowski, Marcin
Reviewer(s):Guzowski, Piotr

Published by EH.Net (June 2020)

Marcin Piatkowski, Europe’s Growth Champion: Insights from the Economic Rise of Poland. Oxford: Oxford University Press, 2019. xxv + 370 pp. £25 (paperback), ISBN: 978-0-19-883961-3.

Reviewed for EH.Net by Piotr Guzowski, Faculty of History and International Relations, University of Bialystok.


Marcin Piatkowski’s book is a study of the contemporary history of Poland and its economic success after the fall of communism. Simultaneously, the author tries to assess the current position of Poland in a long-term historical perspective stretching back to the end of the Middle Ages. Piatkowski claims that the term “Golden Age” ought not to be used with reference to sixteenth-century Poland, but, more appropriately, to Poland after 1989. All his arguments are presented from the perspective of an economist. The author is a senior economist at the World Bank and Associate Professor at Kozminski University, Warsaw.

The book is divided into ten coherent chapters, each of which is followed by a brief summary and conclusions. In addition to tables and charts, it contains boxes with short discussions of specific topics that could not be given sufficient attention in the main body of the text. The first chapter is a universal synthetic presentation of institutional, cultural and ideological sources of economic growth. The following three chapters are concerned with Poland’s distant past — its economic history in the early modern period, and the country’s less distant past — post-war communist era and transformation after 1989. Further, the author presents his own interpretation of the reasons for Poland’s economic success in the last three decades and offers scenarios of its future growth.

Piatkowski, drawing on the achievements of contemporary economic thought, especially the institutional approach, constructs logical models of growth (chapter 1) and applies them to the study of economic development of contemporary Poland (chapters 6 and 7). He seeks to prove the thesis that late twentieth and twenty-first-century Poland experienced unprecedented economic growth, incomparable with any other historical period. Although many (if not most) of the author’s theses provoke discussion and definitely require deeper justification, his analysis of the role of institutions, culture, ideas and leadership is very clear and persuasive. The clarity of the author’s reasoning is in fact one of the book’s greatest merits, even though the resulting simplifications add unnecessary journalistic quality to the narrative. Upon publication of the book, the author frequently presented his economic views to the press, commenting on current economic policies.

It is hard to disagree with the author that one of the major sources of post-communist economic transformation and a key reason for adaptation of western institutions in Poland was a desire “to return to Europe and feel European again” on the part of the political elite (p. 237). Piatkowski is also right stating that “there is no single explanation for Poland’s success since 1989” (p. 201). His interpretations are definitely worth considering in discussions on the course of socio-political and economic reforms in post-communist Poland, but it must be born in mind that they are the result of the reflection undertaken from the macroeconomic perspective of financial institutions.

Piatkowski’s detailed analyses concerning both the events from the recent history of Poland and from the early modern period vary in quality. Apart from relatively balanced deliberations, for example on the importance of religion in the lives of Poles and its impact on economic activity, the book also contains many grossly anachronistic opinions about the past. This is illustrated by the author’s approach to the legacy of communism. Only in one short subchapter does he mention that “Communism fell because of extractive political and economic institutions that supported growth in the short term, but failed to sustain it in in the long term. […] Economic institutions did not provide incentives for entrepreneurship, ‘creative destruction’, and innovation. They promoted the status quo and frowned upon change” (p. 88). In the light of these facts, the author’s insistence on emphasizing the advantages of socio-economic changes in Poland between 1944 and 1989, one of which was to be the creation of egalitarian society, appears self-contradictory (“Why communism was not all bad,” “Positive legacy of communism,” “How communism destroyed feudalism”).

The anachronism of such an approach is in comparing the effects of half a century of communist rule with the situation in Poland before World War II. The author assumes that if Poland had never fallen under communism, remained independent and capitalist for 50 years after the war, it would not have modernized, like Spain or Italy did, but would have remained a backward peripheral economy in the shadow of the Soviet Union (p. 107-12). However, what Piatkowski sees as a chance for Poland, can also be viewed as a major obstacle by which the communist system deprived the country of a prospect for much earlier growth. The author tends to forget that in 1939 the Soviet Union invaded Poland and this fact had grave consequences. One of the elements of Soviet occupation in the years 1939-1941 and later in post-war years was physical extermination of the Polish intellectual elite. Its loss should be regarded as a lost chance for growth. These people were the lost human capital; they could have become the leaders of economic modernization after 1945.

The author mentions that Poland’s transition did not much benefit the communist elites, because only 9 percent of the Polish former top communist party members held higher political offices after 1990. Nevertheless, considering the fact that the first president of Poland elected by the national assembly in 1989 was a communist general, Wojciech Jaruzelski (responsible for the deaths of dozens of protesters killed in 1970 and under whose leadership in the 1980s Poland had experienced its deepest economic crisis), the third president (for two terms between 1995 and 2004) was Aleksander Kwaśniewski, who had been a minister in the last two communist governments, and two prominent communists served as Prime Ministers (Józef Oleksy, 1993-95; Leszek Miller, 2001-2004), it can be concluded that quality was much more crucial here than quantity. Moreover, the starting point in building an economic position for members of the former communist establishment favored them in comparison with all other post-1989 entrepreneurs.

Piatkowski emphasizes that one of the most important achievements of the egalitarian communist system was that it allegedly provided lower-class youth with unparalleled educational opportunities. As he stresses, many Polish ministers of finance/economy after 1989 were the beneficiaries of this system and gained their professional experience in the communist era, doing their scientific internships in international institutions. However, the author ignores the fact that in communist Poland the freedom to travel abroad was a privilege for the few. The ministers whom he praises as leaders of economic transformation after 1989 (Leszek Balcerowicz, Andrzej Olechowski, Marek Belka, Marek Borowski, Grzegorz Kołodko) were the same people who had for years worked to maintain the communist system in Poland and had been to a lesser or greater extent responsible for the economic crisis in the 1980s. Presumably Piatkowski’s positive attitude towards the role of communism and specifically towards former members of its establishment should be viewed in the context of the fact that he was a doctoral student of Grzegorz Kołodko, an adviser to the President of the National Bank of Poland in communist era, and later Minister of Finance in 1994-1997, 2002-2003, praised by the book’s author as a “hero of post-communist transition” (p. 221).

While accepting many of the author’s theses concerning economic growth in general, it is still worth considering alternative interpretations of the processes and events described in the book. Several omissions appear particularly conspicuous. One of them is the author’s failure to mention Mieczyslaw Wilczek’s Act. It was introduced in 1988 by the minister who, although he served in the last communist government, was an entrepreneur and inventor, and supported a radical liberalization of economic activity. The Act contributed to the explosion of private economic initiative in Poland between 1989 and 2001. The author also omits to mention a number of problems related to the social cost of the transformation model chosen by the political elite, such as the emigration of over two million citizens seeking a better and faster road to wealth abroad.

Piatkowski’s deliberations upon the early modern period require separate assessment. They are not the result of any in-depth studies conducted by the author. Instead, he compiles data from a single study of Polish historical data provided by Statistics Poland and uses them to support the thesis that it was not the sixteenth or seventeenth, but the twenty-first century that truly is the Polish Golden Age. Piatkowski does not manage to eliminate stereotypical or misguided opinions from his narrative (e.g. that the gentry turned peasants into alcoholics), revealing his limited knowledge of the historical reality in the early modern period. In his attempt to debunk the myth of sixteenth-century Poland as the granary of the West, Piatkowski compares the Polish Kingdom to today’s developing countries and writes: “Poland was not a banana republic, but for sure a wheat republic” (p. 48). Having appreciated the witticism, it is worth clarifying that 90 percent of grain exported from Poland to western Europe was rye. Wheat was neither an important export nor domestic consumption product, hence using data for wheat trade to support the claim that “Poland was […] not the West’s ‘breadbasket,’ as the Polish stereotype maintains” may easily lead to false conclusions.

Sixteenth-century Poland, with its GDP per capita at the level of 53 percent of the average for four most developed countries of the period is described by Piatkowski as backward. Such an opinion appears hardly justified in the light of the author’s further claim that twenty-first-century Poland, twenty-five years after the fall of communism, with its GDP per capita at the level of 60 percent of the average for the Netherlands, Germany and the UK should be described as “Europe’s Growth Champion.” Piatkowski’s historical conclusions are best characterized as falling into the category described by Gregory Clark in his renowned, though also controversial book A Farewell to Alms: “The popular misconception of the preindustrial world is of a cowering mass of peasants ruled by a small, violent, and stupid upper class that extracted from them all surplus beyond what was needed for subsistence and so gave no incentives for trade, investment, or improvement in technology. These exclusive and moronic ruling classes were aided in their suppression of all enterprise and innovation by organized religions of stultifying orthodoxy, which punished all deviation from established practices as heretical” (Clark 2007, p. 145).


Piotr Guzowski — economic historian and historical demographer – is the author of two books published in Polish (Peasants and Money in the Late Middle Ages and Early Modern Period, 15th-16th c. (Krakow 2008) and Noble Family in Pre-partition Poland: Demographic Study (Bialystok 2019). Other publications include “The Influence of Exports on Grain Production on Polish Royal Demesne Farms in the Second Half of the Sixteenth Century,” Agricultural History Review 59 (2011) and “Village Court Records and Peasant Credit Market in Fifteenth- and Sixteenth-century Poland,” Continuity and Change 29 (2014).

Copyright (c) 2020 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 (June 2020). All EH.Net reviews are archived at

Subject(s):Economic Development, Growth, and Aggregate Productivity
Economywide Country Studies and Comparative History
Geographic Area(s):Europe
Time Period(s):16th Century
17th Century
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Dark Matter Credit: The Development of Peer-to-Peer Lending and Banking in France

Author(s):Hoffman, Philip T.
Postel-Vinay, Gilles
Rosenthal, Jean-Laurent
Reviewer(s):Trivellato, Francesca

Published by EH.Net (November 2019)

Philip T. Hoffman, Gilles Postel-Vinay, and Jean-Laurent Rosenthal, Dark Matter Credit: The Development of Peer-to-Peer Lending and Banking in France. Princeton: Princeton University Press, 2019. vii + 320 pp. $40 (hardback), ISBN: 978-0-691-18217-9.

Reviewed for EH.Net by Francesca Trivellato, Institute for Advanced Study, Princeton.

We have come to expect superb work from the collaboration between Gilles Postel-Vinay (professor emeritus at the Paris School of Economics), Philip Hoffman, and Jean-Laurent Rosenthal (the latter two both faculty at the California Institute of Technology), and their latest book only confirms our expectations. A sequel to Priceless Markets: The Political Economy of Credit in Paris, 1660-1870 (2000), Dark Matter Credit pursues the same topic but expands the analysis across all of France and through the interwar period — and once again makes the subject relevant for all social scientists and economic historians.

The book’s aim is to rebuff the widespread belief that “banks are necessary for industrialization and economic growth,” and that because banks “were slow to spread” (p. 148) in France, the nation industrialized more slowly than Britain. By contrast, the authors claim that “banks diffused slowly in France because of what traditional lending intermediaries — notaries — could do” (p. 174). They demonstrate that “financial deepening does not require the intermediation by banks and centralization” (p. 49) and that “notaries cannot simply be dismissed as archaic financial intermediaries who were unable to survive when faced with competition from modern banks” (p. 193). They conclude that “economic historians’ neglect of all the lending that transited through notaries’ offices has led them to misread the financial history of France” (p. 192), and offer an alternative and persuasive history according to which until World War I, information (not interest rates) determined the course of French credit markets and was the notaries’ purview.

“Dark matter,” a phrase frequently uttered across the Caltech campus, is used here to describe the vast amount of loans that have thus far remained unobserved and unaccounted for. In the authors’ estimation, the stock of debt arranged by notaries totaled 16% of French GDP in 1740, 23% in 1780, a peak of 27% in 1840, and 24% in 1899 (p. 3). Overall, these numbers represent “a phenomenal achievement, particularly for a credit market that has long remained hidden” (p. 217).

I am hard pressed to think of a book that combines “the economist’s thirst for systematic data with the historian’s desire to tap a wide variety of quantitative and qualitative sources” (p. 231) to an equal degree. The core evidence comes from a massive database of loans registered by notaries in 99 French locations (cities and towns of different sizes) in six sampled years: 1740, 1780, 1807, 1840, 1865, and 1899. Chapter 1 and Appendix D explain the archival records from which this information is extracted. Additional documentation includes supplementary notarial deeds gathered for specific years and regions (Chapters 2, 5, and 8), court decisions published in legal periodicals (Chapter 5), data on wholesale merchants and bankers collected from nineteenth-century commercial directories (Chapter 6), and more.

Neither before nor after the French Revolution were private lenders or borrowers required to turn to notaries to draw their contracts, but in return for a small fee, notaries delivered them invaluable services: they offered illiterate or semi-literate private parties a technology they lacked, produced “legally binding written records of agreements,” “certified the legality of the contracts individuals entered into” (p. 53), and facilitated those contracts’ execution. Moreover, “notaries provided one other important service as well: they were matchmakers” (p. 54). They knew more than anyone else about the value of collateral, a lender’s liens on his pledge, and a borrower’s solvency. A striking finding of this book is that notaries remained “the informational lynchpin of the peer-to-peer lending system” (p. 107) even after the 1840s, when the government completed the survey of French real estate (Cadastre) and introduced a new, albeit voluntary, lien registry service (Hypothèques). One of the reasons for the notaries’ continued influence is that they adopted a system of referrals that enhanced their ability to match clients (Chapter 4).

Notaries registered two main types of medium- and long-term loans: mortgage-like annuities extended primarily on real estate property and obligations that did not specify collateral. In the course of the eighteenth century, obligations grew in size and duration and began to include a pledge. Chapter 2 describes the process by which this transition occurred as well as its spatial and stratified dimension across the kingdom.

Chapters 3 and 5 examine the long-term institutional novelties introduced by the Revolution and by Napoleon, and challenge the view according to which the civil law’s presumed rigidity impeded innovation. In the 1820s, a new credit instrument (the notarized letter of exchange) emerged in the southern regions of the country to meet the credit demand of peasants who were often illiterate. Neither the Commercial nor the Civil Code mentioned this instrument, but judges deemed it legitimate.

Chapter 6 illustrates the emergence of banks in the course of the nineteenth century, their institutional make-up, functions, and geographical distribution, and compares these features to the contemporary British banking system. Chapter 7 elucidates why, with the exception of the Crédit Foncier, the government-backed mortgage bank, until the 1920s banks specialized in short-term commercial loans and therefore complemented rather than replaced notaries. Chapter 8, the last in the book, reconstructs the “silent revolution” (p. 195) through which interest rates became the clearing mechanism of French credit markets. Not included in loan agreements during the Old Regime because of anti-usury laws and remarkably stable at 5% through much of the nineteenth century, interest rates after 1899 became as variable as we now know them to be.

Dark Matter Credit is highly recommended for anyone interested in economic history, regardless of their disciplinary backgrounds and areas of specialization. Its methodological contributions are manifold and transcend the topic under investigation. The authors take the core lesson of the New Institutional Economics to heart, but reveal the pitfalls of its practitioners’ tendency to assume that the institutions which matter to economic growth are state-run or central banks. In the process, they also reveal that secure property rights without transparent information markets have little impact, and that more attention should be paid to information systems. Finally, they disprove the oft-touted superiority of common law over Roman law for the development of financial markets. Curiously, the map on p. 26 not only shows the capillary presence of the royal administration in the provinces of the kingdom in 1740, but also suggests that by then, notaries were not, as generally assumed, more prevalent in the southern regions (where Roman law had deeper roots) than in the north (the area of customary law).

Economic historians trained in economics and political scientists with a historical bent will find in this book a signal that their job markets today rarely send: investment in demanding archival research generates genuine discoveries. Traditional historians may be intimidated by some of the statistical tests, or feel that they lack the time and resources to undertake a project of this scale. But I hope they will appreciate not only the book’s empirical results, but also the authors’ decision to walk readers through testable hypotheses, including those that are eventually discarded. Graduate students, at the very least, will benefit greatly from familiarizing themselves with a writing style that, in contrast to narrative history, elucidates the process by which authors formulate causal arguments.

Missing in the book is a sharper sociological characterization of lenders and borrowers. In the eighteenth century, mortgage-like credit coexisted alongside commercial credit, which was mobilized by international merchants on the basis of their reputation and without collateral. As noted in the conclusion, whether and how these two markets connected remains a mystery because the volume of bills of exchange (the quintessential instrument of commercial credit) is not measurable. One may nonetheless ask: Who owned real estate and for what purposes was it mortgaged? To what extent did credit circulate across socio-economic groups? How did the economic hierarchies between merchant-bankers, landowners, and manufacturers change across time and space? Who gained and who lost from using notaries and banks? These questions are peripheral to the overall inquiry in spite of the fact that they are central to the history of modern France and the rise of its bourgeoisie. Dark Matter Credit closes by stating that “inequality seemed to have no effect” on credit markets and their rate of growth (p. 233). To accept the authors’ suspicion that “high levels of wealth inequality are inimical to mortgage markets” is not to deny that the social profile and gender composition of lenders and borrowers can be important attributes of these credit markets.

Francesca Trivellato is Andrew W. Mellon Professor of Early Modern European History at the Institute for Advanced Study, Princeton. She recently published The Promise and Peril of Credit: What a Forgotten Legend about Jews and Finance Tells Us about the Making of European Commercial Society (Princeton: Princeton University Press, 2019).

Copyright (c) 2019 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 (November 2019). All EH.Net reviews are archived at

Subject(s):Financial Markets, Financial Institutions, and Monetary History
Geographic Area(s):Europe
Time Period(s):18th Century
19th Century

The Medieval Clothier

Author(s):Lee, John S.
Reviewer(s):Brown, Alex

Published by EH.Net (April 2019)

John S. Lee, The Medieval Clothier. Woodbridge, UK: Boydell Press, 2018. xix + 365 pp. £25 (hardcover), ISBN: 978-1-78327-317-1.

Reviewed for EH.Net byAlex Brown, Department of History, Durham University.

John S. Lee’s The Medieval Clothier is an excellent first volume in Boydell’s new series Working in the Middle Ages, which aims “to provide authoritative, accessible guides to medieval trades, offering surveys of their origins and development, alongside the practicalities of the occupation,” under James Davis as series editor. As such, The Medieval Clothier is a hugely successful opening book to the series, providing a meticulous examination of the late medieval cloth industry in England. Lee demonstrates his mastery of the topic by taking the reader from the detailed world of cloth production and its many quirks through to the aggregate national picture, while similarly grounding in-depth case studies of prominent families in the larger trends that effected medieval clothiers as an occupational group. In doing so, we see not just the economic roles that clothiers played in medieval England but also their social, religious and political importance through a range of source material that includes national statistics and accounts, contemporary literature and visual material. This is reflected in the book’s beautiful presentation of ten color illustrations, twenty further black and white images and a range of accompanying figures, maps, tables and appendices.

The cloth industry itself was hugely important in late medieval England, with the number of cloths produced increasing from an estimated 163,900 in 1311-15 to some 308,100 by 1541-45, a growth which saw the pounds of cloth produced per capita increase from 1.3 to 7.0 across this period. But how were such increases achieved? Who were the clothiers driving these changes? And can they truly be described as early capitalists? In order to answer these questions, The Medieval Clothier proceeds logically from the production process of cloth in the opening chapter, moving on to explore the marketing of cloth, the regional identity of clothiers themselves, their relationship with the government through legislation, and their role in medieval society, before finally exploring some case studies of famous clothiers.

In Chapter 1, we learn of the world of medieval cloth production, showing how technological developments aided the growth of the industry. Productivity probably trebled at several stages of the cloth production process because of changes introduced in the late Middle Ages: spinning by wheel instead of by distaff and spindle; weaving using a horizontal loom as opposed to a vertical one; and fulling in a mill rather than by foot. Although some clothiers did develop a factory-style of production, the majority of cloth production was made through the widespread adoption of the putting-out system. Moving from production to marketing, Chapter 2 explores how this cloth was sold, what marketing networks the industry utilized, and who participated in the trade. Some individuals did build up their own regional, national, or even international networks, but the majority sold their cloth wholesale to merchants. And as might be expected, it was the Londoners who came to dominate this trade, especially the Merchant Adventurers who came to monopolize cloth exports.

In Chapter 3, Lee explores why the cloth industry came to be based in small towns and villages as the Late Middle Ages progressed rather than the cities and boroughs of medieval England. In some ways this is a product of topics discussed in the preceding chapters, with clothiers flourishing in areas with ready access to labor, capital and markets. After all, the putting-out system on which cloth production was based required little capital on the part of the worker, who in turn could work part-time around the demands of the agricultural seasons. In Chapter 4, we see some of the consequences of disturbances in the cloth industry because clothiers were creatures of credit: by providing delivery of cloth before payment, clothiers were particularly vulnerable to trade crises. This in turn meant they could not pay their workers and Lee shows how a sudden shock could produce serious short-term problems for workers in the putting-out system, who might join a local rebellion to express their discontent.

Chapter 5 shows how medieval clothiers as an occupation tended to transcend many of the traditional social status groupings that we associate with the Middle Ages and could include merchants, craftsmen, gentry or peasants. Clothiers were every bit as obsessed with death and remembrance as other groups in late medieval society, but perhaps most interestingly “clothiers and woolmen displayed the tools of their trade to a prodigious extent not generally found in other occupations,” suggesting a level of pride in their work. In Chapter 6, Lee tackles some of the wealthiest and most famous clothiers of the period: men like Thomas Paycocke who bequeathed money in his will that may have been intended for between 80 and 240 workers; Thomas Spring II whose bequest may have supported 220 to 3,900 workers; Jack of Newbury who may have employed over 1,000 workers; and, of course, William Stumpe who has been seen as a “manufactory-capitalist” by previous historians because of his work at Malmesbury Abbey.

Bringing the book together, Lee concludes that clothiers were a product of their time, emerging in the economic conditions that followed the Black Death of 1348-50 and the subsequent mid-fifteenth-century crisis. He convincingly argues that clothiers cannot truly be seen as early capitalists because — short of a few extraordinary individuals — the majority did not own capital assets and did not employ labor themselves. Instead they relied upon the putting-out system, which, although it left workers particularly vulnerable to trade slumps, did not constitute an economic relationship that could be defined as that of employer and employee.

The Medieval Clothier, therefore, is a highly successful book that provides an interesting, compelling and at all times authoritative survey of one of the most important trades in late medieval England, making it a must read for students and scholars alike.

Alex Brown is an assistant professor at Durham University. He has published on the late medieval and early modern economic and social history of England, including a recent monograph on Rural Society and Economic Change in County Durham: Recession and Recovery, c.1400-1640 (Boydell, 2015).

Copyright (c) 2019 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 (April 2019). All EH.Net reviews are archived at

Subject(s):Business History
Industry: Manufacturing and Construction
Markets and Institutions
Geographic Area(s):Europe
Time Period(s):Medieval

A Local History of Global Capital: Jute and Peasant Life in the Bengal Delta

Author(s):Ali, Tariq Omar
Reviewer(s):Gupta, Bishnupriya

Published by EH.Net (October 2018)

Tariq Omar Ali, A Local History of Global Capital: Jute and Peasant Life in the Bengal Delta. Princeton: Princeton University Press, 2018. xiii + 244 pp. $40 (hardcover), ISBN: 978-0-691-17023-7.

Reviewed for EH.Net by Bishnupriya Gupta, Department of Economics, University of Warwick.



The history of the production chain of jute in India has a large literature on British involvement in the jute textile industry in Eastern India and the involvement of Indian traders in supplying raw material to this industry (Goswami 1991, Gordon 2017). The cultivators of raw jute, have been in the background in this literature. Another strand of the literature on jute cultivation has been a part of the agricultural history of colonial India (Bose 1986). This book brings the local economy of jute cultivation in Bengal into the global network of jute production. Jute was a global commodity similar to cotton and sugar and its production integrated the local economy into the ups and down of global capitalism. While rising prices brought prosperity and changing consumption, declining prices brought impoverishment and indebtedness. The economic cycles of jute cultivation are seen to explain the involvement of the producers to the wider political context.

A Local History of Global Capital weaves a fascinating tale of integration of the cultivators of raw jute into the capitalist economy. This is a rare narrative where the cultivators are the economic agents. They respond to the global market by opting into cultivation of a global commodity. As chapter 1 argues: “the enormous increase in jute production took place without colonial coercion or even incentives and subsidies.” The novel aspect of Ali’s analysis is that the cultivators are not only producers, but also consumers, who benefit from global connections, but also suffer as a result.

Chapter 1 portrays a vivid picture of the economy of cultivation of raw jute, that was sold to traders to be transported to factories near Calcutta or exported to Europe. Most of world’s jute was grown in Bengal. The Bengali peasant, mainly Muslim by religion, engaged in double cropping of rice and jute from the middle of the nineteenth century. The choice to produce an exportable did not create a subsistence crisis until the First World War. Instead, it led to a consumption revolution, where global commodities came to be traded in local markets. It created a new space for the cultivators as consumers.

Chapter 2 discusses the rise of demand for global commodities, such as corrugated iron, German toys and umbrellas. The opposition of the peasants to the boycott of British goods, a political movement against colonization, was not a religious conflict, nor a resistance to increasing prices. Instead, the author sees this as struggle to preserve the economic spaces created through global exchange. These were not only the local markets and the goods that were sold, but their property rights in this economy, where the cultivators were guaranteed the right to produce and the right to buy and sell. The rent control Act of 1859 had given them the first bit of security of tenure in the agrarian economy of Bengal.

Chapter 3 builds a picture of the web of economic exchange built on social relations, where race, caste and religion played their part. Ali describes the transport of raw jute from the cultivators and intermediaries in the hinterland to the jute mills and the trading companies of the metropolis, using country boats and the newly constructed railway lines. The appearance of the transport hub at Goalundo, where the commodities switched from traditional to modern transportation, is a symbol of the colonial connections with the traditional local economy. We are reminded of the production chain of tea in Assam. Goalundo was also the place where indentured migrant workers changed over from the train that had carried them from Calcutta to the country boats. Production of global commodities such as tea and jute, had far reaching consequences for the local communities in the hinterland.

The consequences of marketization of the hinterland is the subject of chapter 4. It describes the ecological crisis in jute cultivation, the declining yield, subdivision of landholdings in the years after the First World War and finally the onset of the Great Depression that ended the prosperity of the delta. As the peasantry became impoverished and indebted, their consumption patterns changed. It changed the politics too. New alliances were forged amid the widening of the movement for independence. Using poems circulated to promote Islam to impoverished peasants in the Bengal data, the new motto was self-restraint from any types of luxury. This resonated with the peasants, who had protected their consumption space in days of prosperity, in the changed economic situation, where even basic consumption goods could be out of their reach. The chapter does not explain why World War I was a diving line in this context.

The following chapters look at the changing political mobilization of the peasantry in the worsening economic situation. Peasant protests intertwined economic demands with a new identity of the rural Muslim. Creation of a separate state became a utopia for jute cultivators. This optimism ended with the birth of Pakistan and what followed in the jute economy of East Pakistan. The penultimate chapter sits oddly with the rest of the book. But in the spirit of the book it focuses on the commodity and its journey across the border that divided the agricultural tracks of jute cultivation with the industries around Calcutta. The newly created state of Pakistan policed the illegal trade of bales of raw jute across the border more forcefully than the crossing of the border by thousands of refugees and migrants.

This book is a local history of global capital and fits into the broader narrative of histories of capitalism. It follows one of the main commodity chains of the British Empire. Here, the peasants are the agents rather than the entrepreneurs. This is particularly novel in the historiography of colonial India. The book highlights the agency of the peasantry in consuming new goods to enhance a traditional lifestyle, but also in protecting property rights using colonial law. As a cliometrician, I looked for statistics. The book has a few. But the descriptive narrative of the economic life of the jute cultivator in Bengal delta is enough to paint a rich and textured picture of why peasants cultivated jute, why they did not participate in the boycott of imports and why their political participation changed as they became impoverished. This book is a wonderful read and a valuable resource for scholars of agricultural economies, capitalism and integration of the local into the global economy.


Bose, Sugata (1986). Agrarian Bengal: Economy, Social Structure and Politics, 1919-1947. Cambridge University Press.

Goswami, Omkar (1991). Industry, Trade and Peasant Society: The Jute Economy of Eastern India, 1900-1947. Oxford University Press.

Stewart, Gordon T. (2017). Jute and Empire: The Calcutta Jute Wallahs and the Landscapes of Empire. Manchester University Press.

Bishnupriya Gupta is the author of “Falling Behind and Catching Up: India’s Transition from a Colonial Economy,” Tawney Lecture 2017, (forthcoming) Economic History Review and “Discrimination or Social Networks? Industrial Investment in Colonial India,” Journal of Economic History, 2014.

Copyright (c) 2018 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 2018). All EH.Net reviews are archived at

Subject(s):Agriculture, Natural Resources, and Extractive Industries
International and Domestic Trade and Relations
Geographic Area(s):Asia
Time Period(s):19th Century
20th Century: Pre WWII

Face Value: The Consumer Revolution and the Colonizing of America

Author(s):Carson, Cary
Reviewer(s):Shammas, Carole

Published by EH.Net (January 2018)

Cary Carson, Face Value: The Consumer Revolution and the Colonizing of America. Charlottesville, VA: University of Virginia Press, 2017. xxv + 281 pp. $29.50 (paperback), ISBN: 978-0-8139-3937-7.

Reviewed for EH.Net by Carole Shammas, Department of History, University of Southern California.

This book updates a 215-page essay published in a volume entitled Of Consuming Interests: The Style of Life in the Eighteenth Century (1994) that the author edited with Ronald Hoffman and Peter J. Albert. Carson, now retired, had a distinguished career at Colonial Williamsburg and served for a long period as its Director of Historical Research. Not surprisingly given that background, this book, like the preceding long essay, discusses consumption largely in terms of domestic architecture and durable goods, not diet, clothing, healthcare etc. He argues, as he did in the essay, for a consumer revolution in British America beginning in the later seventeenth century among white upwardly mobile portions of the population. In his view, an increase in the quantity, variety, and quality of consumer goods changed how people valued them. Men and women became much more likely to use these kinds of goods for self-definition and social interaction than previously.

The book contains seven chapters similar in content to the 1994 long essay. The first lays out his argument about an Anglo-American consumer revolution, the second, “Folk Consumers,” describes what he calls traditional society and peasants’ relative lack of interest in using consumer goods for purposes of self-definition. The next two chapters discuss the beginning of changes in the architecture and furnishing of the affluent classes in colonial America, and then chapter 5 describes the goods and spaces devoted to leisure activities. The following chapter considers the spread of consumer demand beyond the more genteel portions of the population from the time of the American Revolution into the early nineteenth century, but do not look for anything about log cabins here. Nor is there any effort to re-conceptualize the treatment of consumer demand by incorporating the torrent of new social history research over the past fifteen years or so on African Americans and Native Americans. Some of this work appears in his endnotes, but his organizing principles and conclusions remain the same. The final chapter includes his thoughts concerning the consumer revolution, Anglicization and the difference between materialism and material history.

The strength of Carson’s work is that it offers students of material culture ideas about how to interpret the social usage of artifacts and architectural elements by incorporating historical documents into their analysis. For economic historians, who tend to ask different kinds of questions from those raised by Carson, the main value lies in the signals he offers in regard to shifts in early American consumer demand for durables.

Carole Shammas holds the John R. Hubbard Chair emerita in the History Department at the University of Southern California. Her most recent publication on consumer demand is the edited volume Investing in the Early Modern Built Environment: Europeans, Asians, Settlers, and Indigenous Societies (Brill, 2012). She is currently working on a history of the 3Rs.

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Subject(s):Household, Family and Consumer History
Geographic Area(s):North America
Time Period(s):17th Century
18th Century

Energy and Civilization: A History

Author(s):Smil, Vaclav
Reviewer(s):Jones, Eric

Published by EH.Net (August 2017)

Vaclav Smil, Energy and Civilization: A History. Cambridge, MA: MIT Press, 2017. x + 552 pp. $40 (cloth), ISBN: 978-0-262-03577-4.

Reviewed for EH.Net by Eric Jones, La Trobe University.
The arrival of an encyclopedic tome of 550 pages, crammed with graphs, calculations, bar diagrams and the interruption of plentiful “boxes,” so giving every appearance of being a textbook, does not usually fill the breast of a reviewer with joy. Fortunately reading this volume turns out to be a pleasure. Vaclav Smil came to notice in 1984 with The Bad Earth, an early account of China’s environmental degradation, and has since written prolifically on topics concerning energy. He is described as an “incorrigible inter-disciplinarian,” a stance that helps him compare and calibrate sources over the widest possible range. His latest book is a greatly expanded version of an earlier volume and may be taken as a summary of his life’s work. It is immensely valuable for reference as well as for calm, decisive commentaries on the state of knowledge, besides on what is actually or potentially computable about uses of energy worldwide and throughout the very long term.

What Smil concludes about the early modern period provides some of the most insightful passages among a vast number of offerings. The immense stretches of time when most humans remained either hunter-gatherers or toiling peasants can, of course, be approached along an energy perspective. Interpretations of these tedious periods by many authors nevertheless tend to lean on mere assumptions about motive and on various anthropological analogies that are sometimes plausible but commonly arbitrary. They typically amount to pronouncements about indifference to accumulation (readily but unconvincingly supported by material poverty) and chronic aversion to physical labor. Nor is Smil impressed by assertions about the labor supposedly required to erect the great monuments of the past, such as the Great Pyramid, and demonstrates how exaggerated they often are. Better documented detail is available once 1850 is passed, when the Western world took up fossil fuels on a grand scale and soon became a fossil fuel civilization. From that date he pays even closer attention to the energy implications of inventions in sphere after sphere after sphere. He offers a new and informative slant on many of these developments. In principle all this is, however, familiar ground.

Smil’s work on early modern times accordingly stands out between these epochs. What one might call the early modern prologue was remarkably progressive compared with many previous centuries. Smil shows just how much human labor could produce with no more than sweat, levers, treadmills, animals, wind power and water power, and how gradual advances were being made in the diffusion and productivity of these every day methods. His “box” on the raising of Alexander’s column at St Petersburg in 1832 is especially impressive, notwithstanding the facts that foreign architects were employed and that the Monument to the Great Fire of London constructed in the 1670s is taller still. Far earlier than any of this the Romans had made strides in exploiting the power afforded by people and nature. Yet from our distant viewpoint the most interesting fact may be how gradually best practice had spread. The tapping of ostensibly straightforward sources of energy continued for a long time — very long. Water wheels, Smil says, were the most significant energy foundation of Western industrialization. Even allowing for the telescoping effect of hindsight, the ancient world had experienced phases of rapid advance that were not matched for a considerable spell. The later Western world, taken as a whole, was often slow by contrast but at least its gains tended to be cumulative. Permissible loads drawn by French horses in the mid-nineteenth century were about four times the Roman limit. But can we say that reaching this point had been achieved at a reasonable pace?

Agreed, pace depends to some extent on where one stands. Even in the modern period, best practice could diffuse with what to our eyes seems a marked sluggishness. From 1745 the English introduced a fantail to turn the sails of windmills automatically into the wind. Their neighbors, the Dutch, who owned the most windmills in Europe, did not take up this device until the early nineteenth century. For all such blemishes on attainable advance, and despite most labor in England and Wales remaining craft work in 1850, energy output had nevertheless risen fifteen-fold in two hundred years. Was that fast or slow? Either way it meant that industrialization as conventionally defined piggybacked on economic changes already springing up with some frequency. Studies of energy use show that the period leading to modernity was complete by the mid-nineteenth century and by any reasonable measure things changed rapidly thereafter.

Studies of individual subjects might perhaps be thought somewhat like single-issue politics, with the distortions it entails. However Smil explicitly avoids the trap of explaining world economic history in terms of energy alone. Although per capita GDP and energy supply are linked more closely than many elements in socio-economic life, they can be decoupled and a determining role for energy is repeatedly frustrated by political and other choices. Energy use is after all an input, though doubtless one with beneficial outputs, but distributional considerations often alter the expected results. The population response that development economists once thought likely to neutralize any income gained from slow technical advances may have been deflected because elites commandeered a lion’s share of the gains. Smil insists on the need to get the balance right between energy imperatives and a multitude of non-energy factors. He rejects tempting comparisons across sectors, such as the uncannily similar energy use by sailing ships and drainage windmills during the United Provinces’ Golden Age, pointing out that no volume of peat dug would have made possible the voyages to the East Indies. Certainly there were too many overlaps in types of exploitation at any one period to separate history into energy eras. There is long experience and a maturity of judgment in this book that inspire much confidence.

Eric Jones, Emeritus Professor, La Trobe University, and former Professorial Fellow, Melbourne Business School, is the author of Locating the Industrial Revolution: Inducement and Response (World Scientific, 2010), The Fabric of Society and How It Creates Wealth (Arley Hall Press, 2013) [with Charles Foster], Cultures Merging: A Historical and Economic Critique of Culture (Princeton, 2016, paperback) and Middle Ridgeway and its Environment (Wessex Books, 2016) [with Patrick Dillon].

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Subject(s):History of Technology, including Technological Change
Transport and Distribution, Energy, and Other Services
Geographic Area(s):General, International, or Comparative
Time Period(s):General or Comparative

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.

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

Burma’s Economy in the Twentieth Century

Author(s):Brown, Ian
Reviewer(s):Tarling, Nicholas

Published by EH.Net (August 2015)

Ian Brown, Burma’s Economy in the Twentieth Century. New York: Cambridge University Press, 2013. xii +229 pp. $30 (paperback), ISBN: 978-1-107-68005-0.

Reviewed for EH.Net by Nicholas Tarling, New Zealand Asia Institute, University of Auckland.

In his latest book, Ian Brown, research professor in the economic history of Southeast Asia at the School of Oriental and African Studies, University of London, complains that too often the regime in Burma/Myanmar is viewed from an unduly short perspective, one taking its starting point from the defeat of the democracy movement of 1988 and what he calls, for no clear reason, the “apparent” disregard of the results of the subsequent election by the military junta. Nor is he happy to accept the viewpoint of those who go back as far as the gaining of independence in 1948 and declare that the prospects, then fair, were destroyed by decades of mainly military rule.

His well-written book argues that, if we want to understand “Myanmar” now, we should go further back, at least as far as the nineteenth-century imposition of the British regime, particularly after the second and third Anglo-Burma wars. Brown points to the creation of a rice-exporting economy through the opening-up of the delta regions by hard-working Burman peasants backed by Chettiar moneylenders from India in what was at least in that respect a market economy. Indeed the British authorities did little to intervene when, as Brown points out, the system displayed its flaws: good land ran out, productivity fell, and during the Depression land was taken over by Chettiars who had no wish for it and no means of working it.

In the twentieth century most of the rice exports went to India. Brown also points to the other connections with India, strongly urging some arguments already familiar to historians. Making “British Burma” a province of India meant that British administrators tended to ignore the special character of the country and neglect or by-pass its traditional institutions. It also meant that Indians took up many of the new opportunities that the occupation opened up, in administration, in policing, in wharf and mill labor. Rangoon was an Indian town, as Brown puts it.

Even so Burman nationalists advanced their cause in the interwar period by cruising on the back of Indian reformers, and then through the Japanese conquest. But they were deeply resentful of the hold the Indians had secured pre-war, and deeply opposed, too, to the major British firms that had secured overall control over large sections of the economy. Brown argues that the perception of that control — as well as its actuality — was a strong motive with Burma’s leaders when they secured independence. Under Nu in the 1950s, the government pursued policies designed to destroy the colonial framework that seemed so alien, though they involved replacing it by other policies deeply influenced by the West, nationalization, industrialization, and Burmanization of the labor force, the Indian component of which had already been depleted by the war.

To what extent the elite’s choice of policies was accepted by the masses is not discussed. But, as Brown says, Ne Win’s military regime went on to pursue these aims with greater “ferocity” after it definitively installed itself in 1962. The result, he argues, was disastrous. Burmans did not have the training to administer the elaborate all-level command economy they envisaged, and the military — unlike Suharto’s in Indonesia — were not prepared to make use of those who were expert. The state itself was weak, though the regime might be strong. It crucially lacked the revenue essential to a modern state. It also opposed foreign direct investment, while there was no equivalent in Burma of the Chinese capitalists of Malaysia or Indonesia. Autarchy could not succeed.

The post-1988 regimes turned to the free market, but not, Brown suggests, with any conviction. The government still intervenes when it sees fit; the army itself is in the market as well as the government. In accounting for the slow advance of the economy, Brown believes, foreign economic sanctions were less significant than government policies.

In offering these conclusions, he comes rather close to undermining his initial argument, and we seem to need an explanation of the army’s additional “ferocity” and of the SLORC/SPDC governments’ tendency to retain the habits of the Ne Win regime they succeeded. Remarks Brown makes in the concluding paragraphs could perhaps have been incorporated and elaborated earlier in the book. The priorities for all the regimes since 1948 have surely been to hold the state together and to avoid internal disorder. The military believed their answer was better than Nu’s. But the object was the same.

Not much is said of the links with China, so restrained under Ne Win, so greatly expanded after 1988-89. But in the concern to preserve the regime — and the state itself — the governments of the two countries seem to have a common challenge, and in meeting it the ideology of the market has if necessary to give way.

Nicholas Tarling, formerly Professor of History at the University of Auckland, is now Fellow of its New Zealand Asia Institute. His book, The Fourth Anglo-Burmese War: Britain and the Independence of Burma, was published in 1987. Subsequently he edited the Cambridge History of Southeast Asia and published other books on Britain’s policies in Southeast Asia after the Pacific War. His latest book is Orientalism and the Operatic World (Rowman and Littlefield, 2015). Email:

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Subject(s):Economywide Country Studies and Comparative History
Geographic Area(s):Asia
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII

Finding Equilibrium: Arrow, Debreu, McKenzie and the Problem of Scientific Credit

Author(s):Düppe, Till
Weintraub, E. Roy
Reviewer(s):Bjerkholt, Olav

Published by EH.Net (February 2015)

Till Düppe and E. Roy Weintraub, Finding Equilibrium: Arrow, Debreu, McKenzie and the Problem of Scientific Credit.  Princeton, NJ: Princeton University Press, 2014. xxi + 276 pp. $39.50 (hardcover), ISBN: 978-0-691-15664-4.

Reviewed for EH.Net by Olav Bjerkholt, Department of Economics, University of Oslo.

My first contact with this book happened in 2012 while attending a conference on economic thought in Saint Petersburg, when I walked unwittingly into a classroom and found Roy Weintraub mesmerizing the small audience while reading from a manuscript. When it finished I wanted to know about the book but while I turned my back for a second Weintraub vanished, like a character in a Bulgakov novel, no longer to be seen on Chaykovski ulica. I later found out he was not registered for the conference and I wondered if it all had been a figment of my imagination.

But the book was real and, as I found out two years later, even more fascinating than Roy’s forerunner. The main narrative told in the book is the hunt for the proof of the existence of equilibrium in a Walrasian economy by the three key protagonists, Kenneth Arrow, Gerard Debreu, and Lionel McKenzie, with differences in thinking and ideas but pursuing the same aim. The papers claiming to have achieved the proof in a general setting were presented to Econometric Society in Chicago in December 1952. Arrow and Debreu had managed to write a joint paper despite being on somewhat different tracks and without ever having met in person until two weeks before the Chicago meeting. McKenzie submitted his own paper and he and Arrow-Debreu did not know about the other paper until they met at the meeting. The papers were published in successive issues of Econometrica in 1954, and have been standard references ever since.

The book has a marvelous and incredibly detailed reconstruction of the paths pursued by the three protagonists with mathematical details suppressed. These parallel stories are rich in content about how they got the impulses and the inspiration, how they picked up the new mathematical tools they needed, how they interacted or chose not to interact. The narrative has been built from reminiscences, reinforced by interviews, combined with contemporary evidence and painstakingly put together. The narrative continues in a fairly detailed account of the refereeing process which ran into various problems. As the editorial files of Econometrica are not available, the account has impressively been put together by evidence compiled from the authors, referees, and correspondence. There were rivalry concerns, primarily with Debreu and McKenzie, while Arrow took a grander view of the whole process. Arrow and Debreu went through rounds of agreeing on a revised joint paper while McKenzie was quicker to submit but unlucky with the referees who had to be replaced. Robert Solow was brought in as a pinch-hit editor in charge of McKenzie’s paper; but not knowing about the other paper and the tense competitive situation he ill-advisedly chose Debreu to review McKenzie’s paper. The editors of Econometrica were well aware of the importance of these papers. In the end the two papers were published in successive issues of the journal.

Students of Roy Weintraub’s work know that it is not much of an exaggeration to state that he has conducted research relevant for this book throughout much of his life. Weintraub’s Journal of Economic Literature paper in 1983 was a milestone and one of the pillars underpinning this book. Other published works by the authors were integrated into the book. Underneath the concern with the existence proofs there is in Weintraub’s world a wider interest in the mathematization of economics and the breakthrough of new mathematical tools for economic theory. Weintraub has paid much attention to the role of interwar impulses from Vienna in the shape of John von Neumann and Abraham Wald, providing crucial input for the three protagonists in their quest for finding equilibrium, with a key inspirational role played by the Vienna mathematical economist Karl Schlesinger, one of the earliest members of the Econometric Society. The overall scope of the story is really too much to be covered well in a thin book.

In addition to the centerpiece about the proofs, the book has background notes on the early life of the three protagonists to find “what sense of meaning, what hopes led them into mathematical economics” and further “to understand the choices and needs that committed their intellectual lives to the emerging field of mathematical economics.” This reviewer found these quasi-philosophical concerns of less interest than the down-to-earth story about the three protagonists’ respective experiences. The authors label Debreu as “the odd man out,” while McKenzie is characterized by his “frustrations.” Till Düppe has done very interesting research on Debreu’s life and career. The respective oddities of Debreu and McKenzie make Arrow loom larger; he is free of the obsessions and the self-centeredness of the other two and comes through as a curious and interested student who looks into and tries his hand along a much broader range of mathematical economics.

The authors pay very great attention to a small Cowles Commission conference in June 1949 on “linear programming.” (It was indeed the fourth CC conference; the first one in January 1945 brought forth the papers for the famous CC Monograph 10.) The preparation of the conference was discussed in an earlier paper by Düppe and Weintraub, opening with the enticing sentence: “In December 1948 in one of the hotel rooms at the annual meeting of the American Economic Association, seven scholars with various backgrounds, but similar interests conceived the idea of a conference: Tjalling C. Koopmans, Harold Kuhn, George Dantzig, Albert Tucker, Oskar Morgenstern, and Wassily Leontief.” It made me ponder who the seventh man was: David Gale and some other names came to my mind. In Finding Equilibrium the same enticing sentence opens chapter 5 but with “seven” changed to “several” (sic). That was a glib way out; who was the seventh man? My thoughts wandered to the “third man” incarnated by Orson Welles, which premiered the same year.

This conference obviously was a very interesting event but this reviewer finds the importance of and the pretensions made about this conference blown out of proportions. It was one of many meeting places in those years for highly gifted mathematicians and economists to mingle and exchange ideas. The “New Beginning” (p.112), the “new future of economic research” (p.100) and the other solemn terms the authors use about the conference are perhaps only a highfalutin way of stating what was “in the air” as Arrow expressed it. The exalted tone and expressions used by authors about the conference seem oddly feigned. The authors claim that the impact on our three protagonists of the conference was that it “transformed their intellectual lives” (p.117).  Two of them were not even there and Arrow, who was present, was hardly “transformed” by the experience.

The book has weaknesses. It is sloppy on many details, surprising in view of the decades of research that went into it but perhaps a result of pieces written at different times being pasted together. The errors are numerous, so only some examples will be given. The main weakness is perhaps that most of what is written about the Cowles Commission is uninformed, incorrect or just made up. The Econometric Society which at the time was the only community for mathematical economics does not really appear in the book as an entity of importance, neither under “Sites” (chapter 4) nor under “Community” (chapter 5). The Econometric Society was established not least to promote mathematics in economics and the increased emphasis on mathematical economics that happened in the period under consideration in the book is more naturally seen as a continuation of the spearheading efforts of Irving Fisher and the other early members of the Society than as something completely new and different. The relationship between the Cowles Commission and the Econometric Society is even less well understood. The Cowles Commission was “affiliated with the Econometric Society”; for which it was also the “headquarters.” This close and important bond between the Commission and the Econometric Society seems poorly understood by the authors.

Then to some trivialities. The book is confused about the date when Arrow came to the Cowles Commission and similarly confused about when Debreu arrived. These are minor things but the carelessness is worrisome in a book that is very assertive about having got the facts right. The book mentions (p. 14) that Koopmans had a persuasive recruiting talk with Arrow at a meeting (undated) of the American Statistical Society at Cornell. There is no such thing as the American Statistical Society; in fact, the talk took place at a meeting of the Institute of Mathematical Statistics in August 1946. The American Statistical Society is mentioned again (p. 108) where it should have been the American Statistical Association. There are too many such infelicities.

One of the more colorful incorrect assertions is that Abraham Wald fled from Europe and got to the U.S. via Cuba. Totally wrong, Wald arrived to New York on July 4, 1938 on the North German Lloyd line from Bremen to New York, the most popular way of fleeing Europe; the ship had no luxury or first-class cabin. The source given is a 2010 volume about the creation of game theory by Robert Leonard who is likely to have taken the escape-via-Cuba story from Weintraub’s own 1983 paper! Why the false ornamentation when the event itself — Wald’s move from Europe to the U.S. — is of such path-breaking importance that it can hardly be exaggerated.

One mistake for which the authors can be exonerated is the label used for the so-called Nobel Prize in economics. Arrow received in 1972 the “Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel” but that was the first “Bank” prize awarded, and another prize with “Bank” in the name was not awarded until 1991. No “Bank” for Koopmans, or for Debreu. The almost incredible fact is that the Swedish Prize committee has used about eight different labels in English for the prize.

Towards the end of the book the authors follow Debreu and McKenzie to the end of their lives in 2002 and 2010, respectively, while Arrow is left standing erect as a live monument of times gone by, while he himself seems more concerned about current economic issues rather than the history he has helped create. Also these stories provide fascinating glimpses. After five years as research associate of the Cowles Commission, Debreu moved with the Commission to Yale, where he became associate professor, mainly assigned to the Cowles Foundation. Just around the time when his Theory of Value was published in 1959, Debreu was denied tenure at Yale, after a performance that was later found worthy of a Nobel Prize. The book mentions the incident but not why it happened. Perhaps it was the Cowles Foundation refraining from a clear recommendation rather than any other kind of backstabbing at Yale?

A missing item in the authors’ story about how Arrow got into mathematical economics is given a memory glimpse from 1942, when Arrow still had not decided whether to become a mathematician, a theoretical statistician, or choose the path he took. Wald brought Arrow with him to a seminar “where Haavelmo presented his new methods: Marschak in the chair, probing, questioning; Koopmans, even more ascetic-looking and soft-spoken than he is today, obviously understanding the issues better than anyone else; and Schumpeter, somehow ensconced more comfortably than the rest and treating the whole matter with the benevolent condescension of a lord among well-meaning and deserving but necessarily limited peasants. … an important turning-point had been reached, and Marschak saw the need for effective leadership.” It was Arrow’s first meeting with Marschak and Koopmans. Seventy years later it is Arrow who with benevolent condescension is ensconced among well-meaning and deserving but not necessarily limited historians of economic thought.

Olav Bjerkholt is the author of articles about Ragnar Frisch, Trygve Haavelmo and the early Econometric Society.

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Subject(s):History of Economic Thought; Methodology
Geographic Area(s):General, International, or Comparative
Time Period(s):20th Century: WWII and post-WWII