* French economic chronology 19th century








French Economic History: Chronology


Figure 1.--France's rich soil and mild climate has made in a rich province and country before the indistrial era. As Europe emerged from the medieval world, however, it failed to embrace capitalism and then undustrialization, dundamentaly altering European history. Today Drance and the rest of Europe faces a new economic era--the information revolution. And France and this the rest of Europe after enbracing socilist economic policies have failed to effectively compete with the United States in technology. France's and Europe's answer is to fine American tech giants rather than allow their own high-tech companies to flourish. The reason for this is that French and other Europeans countries are not prepared to permit any changes to their expensive social welfare system, even though it is unsustainable and being financed by increasing defefit soending and geowing debt load. French school children like these boys receive an excellent education, probably more demanding than that in America, but the economy is not transforing that talent into high-tech innovation.

Until the Industrial Revolution, French economic history was dominated by one simple fact--the tremendous fertility of French agriculure. Ceasar's conquest of Gaul greatly increased the wealth and power of the Roman Empire. Unlike the Germans and thevBritish, the population was Romanized, Until the conquest of Gaul, Rome was a Mediterranean rather than a European power. Gaul changed that had rich soil if France at a time that agricukture was the primary source of wealth made Gaul a hugely valuable acquisition. The German barbarians swept aross the Rhine and the Germans chiefs becme the ruling class throughour Western Europe, including Gaul. The disruption of Barbarian invasion brought an end to long distance commerce and civilisation retreated to purely agricultural settlements, and isolated military, church, and aristicratic centers. Even with the fall of Rome, the wealth generated by French farmers ensured that France would be an economic and thus political power in medieval Europe. The collapse of Rome unhinged in Gaul from the Mediterranen world. Urban life in Ronamized Gaul and trade declined, Life in ahat the Merovingian age became centered on the self-sufficient manor. This was the esence of the Feudal System. It was in France that the Feudal system achiieved its greatest flowering. As France emerged from the medieval era, it had the largest population and greatest wwealth of the European powers, in part because Germany wasnot unified and decestated by religious wars. Louis XIV attempted to make France the dominantbpower in Europe, but failed in large measure for economic reasons. His wars and court were very expensive and he and his decendents failed to establisg a solid fiscal ststem. They maintained a largely mercantilist and feudal economic system at a time that Britainb and the Netherlands were mocing toward free market capitalism. The result was France lost the 18th century shiw-down with Britain. The country's economic history the Revolution was buffeted by first the Revolution (1789) and than the the Napoleonic Era, the relatively late and incomplete 'industrialization', (19th century) and the terrible world wars of the 20th century. European integration brought prosperity in the mid-20th century. France like the rest of Europe have adopted socialit policies that haave affected its ability to compete technologically with the United States. Major companies like Rebault require Government subsidies. And a popular welfare system that is unsustaionable, currently depends on deficit spendingand borrowing. The French people have enjoyed a prosperous era, but the future with rising debt loads is unclear.

Pre-history

Until the Industrial Revolution, French economic history was dominated by one simple fact--the tremendous fertility of French agriculure.

Gaul

Ceasar's conquest of Gaul greatly increased the wealth and power of the Roman Empire. Unlike the Germans and thevBritish, the population was Romanized, Until the conquest of Gaul, Rome was a Mediterranean rather than a European power. Gaul changed that had rich soil if France at a time that agricukture was the primary source of wealth made Gaul a hugely valuable acquisition.

Medieval Era

The German barbarians swept aross the Rhine and the Germans chiefs becme the ruling class throughour Western Europe, including Gaul. The disruption of Barbarian invasion brought an end to long distance commerce and civilisation retreated to purely agricultural settlements, and isolated military, church, and aristicratic centers. Even with the fall of Rome, the wealth generated by French farmers ensured that France would be an economic and thus political power in medieval Europe. The collapse of Rome unhinged in Gaul from the Mediterranen world. Urban life in Ronamized Gaul and trade declined, Life in ahat the Merovingian age became centered on the self-sufficient manor. This was the esence of the Feudal System. It was in France that the Feudal system achiieved its greatest flowering. What limited international trade existed (primarily in luxury goods such as silk, papyrus, and silver )was conducted by foreign merchants such as the Radanites. Germany was potentially the dominant force in Europe. Germany was, however, rent by the conflict between the papacy and Emperor and would not be united until the 19th century. One historian has formulated a thesis that it was Islam tha bplayed a major role in reinvigoariong French urban life-- the Pirenne thesis. As trade revived few remaining ceners, often old Roman cities, became the nucleus of new towns and cities around which communities of merchants and artisans grew. The High Middle Ages saw a continuation of the agricultural boom of the Carolingian era. Urban life began tp grow. Towns such as Paris, which appears to have begun as druid shrine befpre the arival of the Romans, expanded dramatically. Louis VII established Paris definatively as the capital of France (12th century)/Notre Dame begun durung Louis reign woukd cement the position of Paris. France remained a major power based on the fecundity of its soil, but in many ways was more backward than England, a much smaller power. England and France had fought the Hundreds Years War (1337 to 1453), in the medieval era with England, the smaller power dominating for long periods. The Hundred Year War was actuall more like 130 years. And the War was not the only castrople. There were a series of economic catastrophes, bad harvests, famines, and plagues blighted the lives of four generations of Frenchmen. The population during this peropd had expanded, making the food supply increasingly more precarious. This was all before the polto was introduced as part pf the Colombian Exchange. Nothing rivaled the Black Death. The bubonic plague (Black Death) hit Western Europe in (1347) killing a third of the population. The French monarch was weak during the High nMedevial era because of the strength of provinces. A major source of revenue was the dcbasement of the currency. This at times reached spectacular levels. The monarchy debased the silver content of its coins by more than 50 percent in just one year (1303).

16th Century

The basis of the French economy was its rich soil and mild climate--a perfect recipie for agriculture. France was the leading European econmy nation because of its highly productive agricultural sector. Spanish comnquests in the New World brought vast quantities of gold and silver, but it did not benefit the country's basic economy, in fact it actually adversely affected the economy. French agricultural production was centered on the wheat needed for bread. And no country in Western Europe was mmore suited for growing wheat--a crop originated in the dry, sunny Middle East, bu wheat and othe grains coukd be grown with irrigation. The rest of Western Europe was less suitable. Spain was to arid. Germany and the rest of northern Eurooe was more cloudy and arid. Iraly was divided with increasingly exaused soil in the wheat areas of the south. Important crops included olive oil, wine, cider, woad (Fr. "pastel", a source of blue dye), and saffron. In the south harvests included artichokes, melons, romaine lettuce, eggplant, salsifys, celery, fennel, parsley, and alfalfa. And in the 16th century the Colombian Excange began. New World crops appeared at mid-century, but would take some time to be integrated into the French agricultural economy. The most important new crops were pototatoes and corn (maize). other crops inc=luded beans, squash, tomatoes, and bell peppers. Farming methods were little changed from medieval times. Here the Feudal System was a factor, largely resistant to change. This meant relatgively low yields. The Renaisance began in the Italy (14th centuty). but by the 16th century was signifucantly affecting France. The Renaissamve was the artistic and cultural 'rebirth' of Europe, but had significant econonomic consequences. One result was that the French monarchy began living increasingly beyond its means, enjoying the art and cultural advances which were part of the Renaisaance. French finances were already unsatable. At times, French revenues from currency manipulation exceeded that from all other sources. The monarchy began to run up crippling with Francis I (1522). The monarchy pursued opaque financial accounting to vconceal deby levels and dependence on short-term loans. The result was that France was vulnerable when Philip II of Spain upset European financial markets with he default on Soain's debts (1557). One might ask with huge quantities of bullion being delivered to by treasure fleets, how Sapin could have gome bankrupt. The anser is basically a weak economy and Philip's huge spending to fight the Reformation. Defaults just as in modern times have international complications. Francis; sucessor, Henry II, giben Phili's default, experience kincreasing trouble rolling over his short-term debt. He pledged that that would not follow Philip's example. But he was forced to default (1558). The resulting crash of 1557-1560 was a financial event of international dimensions, spreading throughout Europe. The Crash while substantial was a one time hit. But the Monarchy's opaque financial system was not reformned as the country revovered. French kings sold public offices as an immprtant revenue measure. What this amounted to was gibing up future tax revenues for immeduate upfront payments. This was a system that could not continue forecer. In addition, corruption was rampant. The Monarchys loss of control over tax revenue was a serious weaknees that would continue until the Revolution (1789). As Europe emerged from the medieval era, Catholic France did not pursue the Inquisition like Spain and the Papacy in Italy, thus the country did not become an intelectual backwater like those countries. A factor here was the considerable success of the Reformation. At the same time it did not become a major intelectual center on the same order as England, at least until the Enligtenmment (18th century). France had the largest population amd was the richest country of Western Europe. It was at the heart of the European economy. And by the 16th century most of the country's land suitabke for farming was being used. There were a seies of disastrous harvests (1550s). If this was not bad enough, the country was racked by the crisis of 1557-59. By mid-century, Lyons was one of Europe's great commercial and financial centers. Antwerp dominated the exchange of finace , the transference of currencies from place to place, especially Germany and Spain. Genoa served as a center for inter-Imperial tranactions between German (Imperial) Hapsburghs and Spain. For the French excanges with countries they were dealing was centered in Lyon. The important medieval Lyons commodity fair offered Spanish wool; Breton linen; Italian silks, lace, and goves. They were traded for books on which Lyon proded itself in addition to the wine of Rhône and and Saône, the cloth of the Midi, anmd spices from the Levant. [Hauser] This began to change as the spices begun to arrive directly because of the Voyages of Disovery.

17th Century

The French ecomomy was marked during the first half of the 17th century by rapid population growth and by important developments in agriculture and industry. France was the most populated country in Europe. One source reports that France was the third most populous country in the world, exceed only by only China and India. The population was 17 million in 1400 and had only increased to 20 million by 1600, but huge population increases occurred in the 17th century. The French population reportedly exceeded that of Russia, but that we need to confirm. The Fremnch popiulation was twice the size of Britain and Holland ehich would become major adversaries. A massive increase in the urban populations was noted, although France remained a profoundly rural, agrariam country. Less than 10 percent of the population was located in urban areas. Paris was one of the ;argest cities in Europe and rapidly expanding. Agriculture continued to be the primary generator of wealth in the 17th century. And with its large population and rich agricultural sector, France was a force to be reconned with. By the 17th century, the new crops from the Colombian Excange (especially potatoes and corn) had begin to significantly increase France's alread prodigeous aguricultural output. All of Europe benefitted by the Colombian Exchange, but France s the keading agricultural country benefitted most. Germany was still divided and aseverely affected bny the Thirty Years War (1618-48). England was ravaged by Civil War (1642-51). The French economy continued to be constrained by the Feudal system and royal absolutism which inhibited the ability of individuals to develop their talents and abilities. Th richness of French solil and climate continued to produce cops that made France the major economic power. Given the greater size and potential richness of France, one might have expected France to emerge the victor in the European struggles for power, This did not occur. French defeats in a series of war stemmed lrgely because its economy was still largely feudal while Britain embraced capitalism fueled by a maritime economy which would give birth to the Industrial Revolution. At the dawn of the modern era, Louis XIV launched a major effort to expand France's borders. Louis was an agressor in a world that France was already the leading country. Louis had a taste for the extavagent. Cort life was envied by all of Europe and very exoensive. He Louis ordered costly buildung projects, not only Versailles but hundreds of forts. And his many wars drained French finances. Louis initiated two conturies of intermittent warfare with England and other neigbors which extended into the early-18th century and. His extavagances were coninued by his deccendents. France's failure to become a center of capitalism, like England and the Netherlands was the defining factor of the 17th century. A further factor was the end of the Reformation in France. Louis XIV Revoked the Edict of Nantes (1685). This led to the supression of the Hugenoughts (1685). The supression of some of the most talented and enreprenurial peoplein the country would be a factor in some of the French failures of the 18th century, especially in the sea confrontations with Britain. The Hugenoughts had been the heart of the French Navy.

18th Century

Louis XIV's military adventures had largely bankrupted the country. France gradually began to recover after Louis' death (1715). Ther was a gradual economic and demographic recovery, because his grandson Louis XV did not continue his military adventures. Louis made a major mistake as the very beginning of his long rule. He adopted the paper money system recommended by a early econmist, Scottsmam John Law (1716-20). Although not entirely Law's fault, the French finances were destroyed when the Mississipi Bubble erupted (1720). Louis turned to finance s minister Cardinal Fleury to repair the damage (1726). He established a system to restore monetary stability. A strictly enforced conversion rate between gold and silver was established which set values for French coins. The impact was substantial. When French landowners began to be paid in real money, harvests increased. This led to anera of substantial expandion (1730s-70s). A factor here was the New World. While the Mississippi Bubble exploded, Caribbean sugar islands made a huge contribution to the French economy. And the most most important was Saint-Domingue (Haiti), the western portion of Hispaiola. France's population and economy experienced significant invreases. This would substantially imorive France's position in the coming showdown with Britain. Expanding demand led to hihjer prices for agricultural products which proved extremely profitable for large landholders. Artisans and tenant farmers also benefitted toman extent, but far less from the growing economy--and were adversely affected by infation. Mew farming methods adopted fromn Britain and Italy includeding crop rotation and the use of fertilizers began to be used in France, but would take time to befully adopted. The new crops from the Colombian Exchange were now fully part of French agriculture. Potatoes in particular helped to support the increasing population. Indusries included mines, metallurgy and textiles. Particularly important were dashiinable printed textiles. Christophe-Philippe Oberkampf, note the German origins, was particularly notable for his beautiful printed fabrics. Many advances in French industry were the work of forigners, probably the result of the continuing importance of the Feudal System. Thus some of the great adbances leading to the Industrial Revolution took place outside of France, especially in Britain. The French wouls eventually have to turn to a German to bukld tghr notorious Paris Guillotin. More importantly, John Kay's flying shuttle revolutionized the textile industr. James Watt's steam engine powered the new industraies. All of this was crucial for France, although not fully inderstood at the time. As long as economies were based on agriculture, France was going to be the dominant country in Europe. As the European economies began to indistrialize, this was bound to change. Because of Frances relative weak finacial system, capital continued to be difficult to raise for commercial ventures. This is one reason that France lagged behind Britain in the Industrial Revolution. French economic policy remained unchanged, mercantilistic, protectionist, and highly interventionist in the domestic economy. French regulations set often restrictive requirements for production quality and industrial standards. And regulations limitited major industries to certain cities furthet restricting economic activity. Important commercail centers were located in Lyon, Marseille, Nantes, and Bordeaux. Nantes and Bordeaux in particular reported significant growth, largely the result of increasing e trade with Spain and Portugal. Cadiz in southeastern Spain was the commercial hub for export of French printed fabrics to India where France and Britian were beginning to struggle for control. Trade with the America was also important. Caribbean sugar islands become an imporant part of the Kingdom's finances. The slave trade, also important. was centered in Nantes. The Monarchy's financial crisis led to new taxes., taxes that penalized successful entrepreneurs, but exempted important parts od fociety, most importantly the aristocracy. This and new wars would eventually lead to Revolution.

French Revolution

The French Revolution is best known for the Regin of Terror and many wars, but it had profound economic consequences. The Revolutionaries abolished many of the constraints on the economy that had been erected over time by the Ancien Régime. These restions began with the medieval guilds and continued by the decrees issued by sucessive momarchs pursuing mercantilist policies. Much of this was swept away by the Revolution. The guild system was abolished as a worthless remnant of medieval feudalism. The Revolutionaries also did away with the inefficient and harmful system of tax farming which meant that private individuals would collect taxes for of course a substantial fee, increasing the buden on productive enterprises. The Revolutionaries seized the revenue stram for hospitals, poor relief, and education, but did not continue funding so most of the country's charitable and educational systems were disrupted. The economy plummeted with the disruptions in public life (1790-96). Both industrial and agricultural output plummted as well as foreign trade. Prices as a result of inflation soared. The Revolutionaries from an early point decided not to repudiate the debts of the Ancien Régime. Instead their approcah was to print vast amounts of paper currency -- the Aassignat. This was backed by the lands sized from the arististocracy which was being guillotined. The result was to fuel inflation. The Revolutiinary Government resonded by imposing price controls. The police were ordered to arrest speculators merchants selling in black market. People resisted paying taxes. The government deficit spiraled out of control. It was 10 percent of gross domestic product (GDP) (1789), but raeched 64 percent (1793). After the poor harvest of 1794 and the removal of price controls, inflation becgan to reach Zimbabewan/Venezuelan 3,500 percent (1795). The Government cancelled the assignats (1796), but the taxes which repaced it caused furher inflation. The rampid inflation was finally ended by Napoleon with the creation of a new cirrency--the Franc (1803). The inflation had mamy adverse consequences, but it did have the impact of rendering the debts of the Ancien Régime meaningless. Agriculture more than any other sector was transformed by the Revolution--priarily because it trmasformed ownership of the land. Many of the most important nobels owning vast estates lost their heads and estates. The Revolutionary Government abolished tithes owed to the Churc which was amajor landoner. They also abolishedtge feudal dues owed to the great nobel landlords. The result at first hurt the tenant farmers who paid both higher rents and higher taxes, but left the tennants in possession of the land they would eventually own. The Revolutiinary Government nationalized all church lands as well as lands belonging to royalist enemies who went into exile--saving their heads if not their land. The initial plan was tonuse the income from the seized lands to finance the government by through assignats. The breakup of the large estates owned by the Church and the nobility and worked by hired hands and tenant farmers tansformed rural France where most of the population lived. Rural France became a land of small independent farmers. There was no place like it except America. The rural proletariat was transformed in to small commercial farmer. This mean that the revolutinary minded rural peantry was transforned into the most conservativce sector of society -- the rural and now land-owning peasantry. One important Engish expert on French historian writes succintly that the Revolution 'bequeathed to the nation a ruling class of landowners.' {Cobban] Despite the political instability and infation, small scale entrepreneurship flourished in the cities as all the restrictive monopolies, privileges, barriers, rules, taxes and guilds of the Ancien Régime were removed. The Royal Navy blockade, however, damaged overseas trade. And the Haitian Revolution weakened French finances. The income from Caribbean sugar plantations had been enormous. The Revolution did not, however, fundamentally change the country's French business system. It basically froze French industry in place. The French businesses sector was primarily small shop owners or operators of local mulls with family help and a small number of wage emolotees. Large industrail concerns were less common than in France than in other industrializing countries. This would have little impact on the Wars of tf the French Revolution and Napoleon, but would significantly affect France's place in Europe in the 19th century.

19th Century

France would not begin its own Industrial Revolution until after the French Revolution and Napoleonic Wars (1783-1815). After the Napoleonic Wars, the Industrial Revolution spread to France. Britain, France, and Germany (even before unification) were the the European industrial leaders. They also became the leaders in science and education. The Catholic hieratchy after the final defeat of Napoleon slowed the movement toward public education, although the secientific elite was competitive with Britain and Germany and the United States was just beginning to develop universities and technological institutes. As with the rest of Europe, France was overtaken by the United States in the late-19th centyry. Interestingly, France was a rare country in Europe that did not have substantial emigration to America. This leads one to ask what was different about France. The one outsatanding difference bwrween France and Britain as well as the rest of Europe was that that there was still a very large and politically important land-owning pesant population in France. This probably explains why the French population, unlike the rest of Europe, grew so slowly. And it was widely believed in France that the country lost its position in Europe prinmarily because the population duriung the 19th century was less than that of the otherbmajor powers. France's movemnent to an industrial economy was also much slower than Britain, Germany, and America. French industrial production lagged sinificantly behind Britain and even Germany, especially Prussia. A major factor was indeed the slow expansion of the French population relative to other countries. Here the primary cause was the French peasantry. French peaasnts now owned land, but relatively small plots. This limited the size of the families they could support. The British are often jokinglunaccused of being plegamatic and thevFrencg amorous. Yet during theb19th century, the British population increased by some 350 percent, the German population increased by about 250 percent. The overall European population more than doubled. The French population in contarst increased by a mere 40 percent, to only about 39 million people. French mortality rates did decline. But it was the birthrate thatwas important. The French birthrate declined more than the rest of Europe, especially thr Grrmans. Some peasants migrated to the cities in search of a better life. France’s urban growth before the Revolution was significant. After the revokution, it was modest in comparison to Britain and Germany. Only 14 percent of the French population lived in cities of over 10,000 by mid-century. In Britain urbanization was neraly 40 percent by mid century. This proabably explains why so so many French people migrated to America. Itbalso explains why the ecomomy grew so slowly. Economic data shows that agricultural ouput expaned less than 1 percent annually and industrial groth onky 2 percent annually after the Napoleonic era. [Crouzet] Demographic factors may in part explain France's slow rate of industrialization. Some economists also point to the Coal Problem. Coal was at the heart of 19th century industry. And Britain led the Continent in coal poroduction, but by mid-century, Germany was also significantly outproducing France and by the end of the century the difference had reached very significant levels. [Munro] Some authors have dismissed the Coal Problem, but unlike Britain and Germany, French coal and iron ore deposits were not located close togrther. There was nothing like the German Ruhr or the British Midlands in France. Before the railrods it was not economic to transport coal any distance. And shortly after the railroads had become imoortant the Germans in the Franco Prussian war has seized the imortant coal and iron deposits in Alsace-Loraine. While the provinces contained only about 15 percent of the French population, they produced some 60 percent of French steel and 40 percent of the coal. Fortunately the French discovered the rich iron ore deposuts at Longwy-Briey (1880s). While France did not keep pace with the other major powers in population and economic growth, it did in technology. This was in part due to the educational reforms of the Third Republic (1871). The schools were taken out of the hands of the Church and France created one of the finest educational systems in the world. While French industrialization was slower than that of its rivals, it was not insignificant. And by mid century France was developing a major iron and steel industry and constructing an important rail system. Here the Third Republic also played a role. The humiliating defaeat at the hands of the Prussians (1870) taught the French a number of lessons, in particulat two. First, never fight the Germans again without allies. Second, the inmportance of the iron and steel industry in national military power. The Third Republic began promting the growth of this critical indudtry. [Munro] As in other countries, an industaail proleterit was rising in the cities. By the end of the century, the percentage of industrial manpower, relative to the number of working age adulkts (25 per cent), was actually higher in France than it was in Germany, but then failed to rise further.

20th Century

France in the 20th century was an important economy even though it was superceeded by America, Britain, and Germany. Tsarist Russia was reaching French industrial levels. The Soviet Union would rise as an important industrial power, but did not compete in international markets. Japan recovered rapidly fronm the Wprld War II disaster and did compete. By the end of the century, China would become importantly economically. France's economic growth rate varied substantially in the 20th century. There were substantial spurts of economic growth in the post-war recovery decades of the 1920s and again in the 1950s, but understandably substandard performance in the 1910s and 40s war years. There were especially poor performances in the 1930s, and 1990s. The 1930s is understandabke as this was the Great Deression decade. The strong 1960s performancee resulted from the initial impact of European intehration (5 percent), but then France expeience three decades of declining growth. This included the still respestical 3.1 percent in the 1970s, but 2.0 percent in the 1980s, and disappointing 1.3 percent in the 1990s. [Dormois, p. 31.] French economic policy was high tariffs to protect industry, especially the iron and steel industry so vital to millitary power. Unlike the other major powers, there were few major industrial concerns. The economy in the 1900s grew at an average 2.3 percent. This was the economy with which France faced Germany in World War I. Germany had a much larger population and industry. France having learned its lesson in 1870, this time had major allies, at first Britain and Russia and eventually America. Even before America entered the War, loans from American banks helped finace the war effort. This was important, because Germany without such finacing experienced serious privations on the homefront which undermined the economy. In contast to Germany, decent standard of living was maintaine on the home front in both France and Britain, but tragically not Russia. The arrival of over a million American Doughboys would turn the tide in the Western Front. Labor shortages were alleviated by the use of volunteer workers from the colonies and China. The war damages has been estimated to over 10 percent of the pre-War GDP. All of this was located in the northeast along the Western Front. France's national debt rose from 65 percent of GDP in 1913 to 170 percent in 1919. The War was financed by domestic bond issues and American bank loans. his explain's France's insistance on reparations at Versailles. Inflation was rampant. The Franc lost over half its pre-War value. The French economy recovered strongly during the Roaring Twenties. The Wall Stret crash and American Goverment policy responses caused the world-wide Depression that dominated the 1930s. The decline in France became serious (1931). The American Smoot-Hawley Tariff exported the Depression. Compared to more industrailized Amrtica and Germany, the Depression was relatively mild, but still serious. Unemployment peaked under 5 percent. The decline in production was less than 20 percent. There was no banking crisis. The German victory had severe economic consequences. The NAZIs demanded huge reparations. Hitler's war plan was to run the NAZI war effort by exploiting the resources of the East. The failure of the Ostheer meant that it was the occupied West, especially France, that suported the NAZI war effort. The French economy was severely damages by the NAZI occupation, perhaps more so than actual war damage. The American Marshall Plan and the first steps toward European integration helped stimulate the French Economic Miracle. There was an extended period of unprecedented growth that lasted for much of the postwar period until the mid-1970s. Here recovery from the War aided by the United States and European integration were important factors. The loss of Empire as in the other colonial ppwers proved to be a non event. The French refer to this period as the 'trente glorieuses' (thirty years of glory). The period of most rapid growth was the 1960s and early 70s. The GDP growth rate from 1960-73 averaged nearly 6 percent annually. This ended with Oil Crisis of the 1970s. Growth rates moderated signiicantly and unemployment began to increase. The most imprtant industrail complex in the country, Renault, could only stay in buiness with generous Government grants. The French have not yet come to terms with the decling growth ratese, primarily because a substantial part of the slowing economy is the sacrosanct welfare system. Suggesting cuts is political suiside. France like the other European countries have retained a core capitalist economy, understanding that if you are going to have an expensive welfare system, something has to generrate the wealth to finance it. The problem is that the French economy does not generate the money to pay for the welfare system. And the Government has turned to borrowing the needed funds to pay for it. France has been aided by the United States covering most of the cost of defending Europe as well as important part of the health care system by finacing the cost of pharmecutical development. And the borrowing and resulting debt will only increase in the 20th century. It is undeniable that this has impacted growth. Another factor is surely the penchant of the European Union (EU) beaurecrtas for regulation -- the sane kind of regulation which hobbeled the economy of the Ancien Régime. Notably, few of the EU bereaucrats have any experience with productive enterprise like business or farming.

The 21st Century


Sources

Cobban, Alfred. Social Interpretation of the French Revolution (Cambridge University Press: 1964), 178p.

Crouzet, François. "French economic growth in the nineteenth century rev=cinsu-idered," History Vol. 59, No. 196 (1974), pp. 167-79.

Dormois, Jean-Pierre. The French Economy in the Twentieth Century (2004).

Hauser, H. "The characterucric features of French economic history from the middle of the sixteenth century to the middle of the 18th century," The Econiomic History Review (October 1933).

Munro, John. "The spread of modern indistrializatiomin the 19th century: The 'Slow industrialization' of France, 1789-1914".

Pirenne. Henri. Medieval Cities: Their Origins and the Revival of Trade (1927).







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