The history of France is one that stretches far back into the past with the rise of national states

Teddy Harrington

Summary of the History of French Economics

The rise of powerful nation states in the Middle Ages resulted in a world power struggle where a country’s economic prosperity often dictated its nation’s overall prosperity. Since the rise of capitalism in the 1500’s, the measure of national economic power has become production capacity. Large production ability has often led either to the gaining of economic reserves or to the providing of these reserves in deciding international conflicts. Furthermore, a large production capacity has made it possible to sustain a large population–an intimidating sign of national power. France, like other nations vying for a spot on the international scene from 1500 and onward, concentrated its efforts on augmenting its own production capacity. Unlike Spain, France did not obtain rich colonies with mines to be exploited and natives to be robbed. And unlike England, a country that had industrialized early and had definite advantages in certain branches of manufacture, France could not rely upon foreign trade to acquire articles of consumption. France was therefore forced to try and develop all phases of its economy at more or less the same time. If France could not be economically self-sufficient, it would at least have a well rounded economy based on capitalist principles.

During the period of 1500 to approximately 1789, the nature of national economics changed greatly. This period of time saw the extension of commerce over large areas, the development of manufacturing for local consumption and for distant markets, and the rise of modern capitalism. The nation states which evolved during the sixteenth, seventeenth, and eighteenth centuries, took notice of these economic changes and developed policies which have been called mercantile, or trading policies.

In France, during the sixteenth through eighteenth centuries, the ability to produce goods was considered important in attaining national power. State policy therefore aimed to increase production capacity. The policy included help given to existing industries, the introduction of new industries, a political attack on indolence, regulation of manufacturing, and protective tariffs. Furthermore, the state tried to stimulate the economy by opening up new markets at home, by removing internal trade barriers, by establishing foreign trade companies, and by colonial expansion and exploitation. Other aids to business and capitalism, such as a central banking system, a national currency, and a uniform national code were more economic additions put into place. As the French Revolution approached, France had achieved economic unification and had also obtained a national economy that resulted in the rise of a new middle class.

The French Revolution is considered by many to be the most significant period in the history of French national economics for three reasons. First, there was an increase in national passion. Prior to the Revolution, national sentiment was largely limited to the "intellectuals," and the masses had little national consciousness. Beginning with the Revolution however, the King disappeared and democratic principles were established. Since this time, there has been an increasing tendency for the nation to be concerned with each and every person in it. Second, the French Revolution marked the rise to political power of the middle class. While the bourgeoisie could not maintain the position it would achieve against rulers like Napoleon I, Charles X, and Napoleon III, the rise of the bourgeoisie resulted in a state dominated by capitalist interests. Third, the Revolution proved to be a time for economic experimentation. Old economic policies gained different character in a new economic period.

The cahiers that were prepared for the calling of the Estates General in 1789 demanded the complete economic unification of France and a greater use of mercantilist policies for increasing capitalist activity in France. The Constituent Assembly began the realization of this program and succeeding Revolutionary governments continued it. The constantly rising middle class, combined with the conviction that France could not compete with England in many branches of production, tremendously increased the speed with which the new economic policy was implemented. The Convention established a high tariff on British goods and established a navigation act in 1793. Under the stress of foreign invasion, the Convention made great efforts to stimulate production to a point which would provide France with the goods that it needed.

With the passing of military danger, the aggressive economic policies of the Convention were moderated and allowed to fall out of existence. When the war began again however, the Directory was very generous in offering industrial aid and in offering prizes for the invention of new machinery. The economic aid provided to specific industries angered the middle class and eventually, with the help of the Royalists, the Directory was overthrown and Napoleon came to power.

Napoleon very much wanted to build up the economic strength of France. During Napoleon’s empirical reign, a national commercial code was written, the Bank of France was established, a network of roads was built, and technological improvements were strongly encouraged. Napoleon though, expended most of his energy and money on war. His hope was that the Continental system would provide France with the markets that had formerly belonged to England and eventually make French industry superior to that of England. Napoleon’s economic plan however, was unsuccessful. England was able to withstand attacks on its economy and France suffered from being deprived of foreign raw materials such as cotton. Napoleon’s reign did not bring peace or lasting prosperity to France. After the defeat of Napoleon, England, Austria, and Russia met at the Congress of Vienna to decide France’s fate. The victorious Continental powers were satisfied with the territorial advantages they had gained and France did not severely pay economically for its defeat. Though France was spared complete economic ruin at the beginning of the Restoration, it was certainly not the potent economic rival to England that it was before the Revolution.

During the restoration of the Bourbon dynasty, Louis XVIII lived out his reign by pursuing an economic policy of compromise called protectionism. First, there was a period of excessive credit expansion and high prices. This period was followed by a reaction of low prices, stringent credit, and a reduction of overall business activity. When Charles X took over as King, one of his first acts was an attempt to re-establish a modified form of primogeniture. While this policy was never implemented, Charles X did indeed pursue an economic policy based on helping the land-owning class in France.

During the reign of Charles X, the Bourgeoisie became jealous of the noble class for its advantages and waged a campaign to establish equality. The aims of the Bourgeoisie were supported by the political philosophy of liberalism; that of liberty, equality, and fraternity of all capitalists. Liberalism was in its historical setting a class philosophy. It provided ideas for middle-class capitalists to obtain political power. Toward the end of the reign of Charlies X, the rift between capitalists interested in agriculture and the capitalists interested in industry began to disappear. The capitalists ultimately performed a Coup d’Etat and by the July Monarchy, all capitalists had come together into one class.

Gradually, the Bourgeoisie class obtained virtual control of French politics. They were able to enact those laws, at least in matters of national economy, which were to their advantage. Of course, they would have to deal with the autocratic Louis-Philippe, but they succeeded in removing Louis by another revolution. Napoleon III attempted personal rule, and for the first 10 years of his empire, the French economy thrived. The next 10 years of his empire saw a bit of an economic depression and eventually, Napoleon III as well would bow to the wishes of the capitalists. With the coming of the Third Republic, the new French government implemented a policy mostly concerned with imperialistic expansion. While expansion was not always a prudent economic move, French nationalists loved to see cartographers creating maps with French possessions. In France itself, capitalist ideas still ruled. At all events concerning national economics, capitalists would rationalize their action by arguing that if production decreases, not only would they suffer, but the strength of the entire nation would be compromised.

As World War 1 gradually approached, the French realized that they had lost ground economically during the Revolutionary and Napoleonic periods and trade statistics did support these realizations. From the Restoration and onward, France felt itself on the defensive in the cost of producing most goods. Still, the period of economic depression that met France provided France with time to consider various economic policies for the future and ultimately, equipped France with a very diversified economy. In the modern era, the French economy did indeed recover. And while France has certainly not achieved self-sufficiency, it has approached it.

Questions, Comments Problems? Don't Hesitate to contact us: webmaster@kirschnet.com