Pioneers of Capitalism: The Netherlands 1000–1800

"This is a very interesting book about the development of the Netherlands during the early modern period, culminating in its 17th-century Golden Age. You’ve actually just done an interview with one of the authors, Maarten Prak . I find this period particularly fascinating because the Netherlands appeared to be close to an industrial revolution that never was. The region possessed a commercialized, capitalistic society with the world’s highest standard of living and a relatively advanced degree of political and economic liberalism. At the same time, there was an efflorescence of art, literature, intellectual culture, and philosophy. One good reason to find an explanation for why this happened is the paucity of data points for the pre-industrial era, in terms of episodes we can use to explain why, eventually, one country—Britain—did start to achieve sustained economic growth. The Netherlands had many of the indicators of impending development and, indeed, Britain in many ways imported Dutch institutions and culture (even its monarch!) in the years preceding the Industrial Revolution. There is good reason to believe that this cultural diffusion had some positive effect for economic growth. So we should probably do more to understand the Netherlands. There are fewer people studying this period than there should be, just because, as an English language scholar, it’s hard to engage with French and Dutch sources. This book is an enormous contribution. Support Five Books Five Books interviews are expensive to produce. If you're enjoying this interview, please support us by donating a small amount . Prak and Van Zanden are trying to explain why the Netherlands is the birthplace of modern capitalism. They want to refute three traditional arguments for why this happened: the Marxist view of enclosure and exploitation, often applied to Britain; Jan De Vries’s claim that the Dutch were free of feudalism; and, the strict institutionalist explanation—that liberal semi-democracy is better for growth than autocracy. They find all of these factors wanting. Instead, they look at the long-run origins of Dutch economic development, starting with its feudal, almost republican institutions during the late Middle Ages. They include cooperative institutions like guilds and urban associations, as well as the empowerment of independent cities in the region’s governance structure. These institutions were ultimately protected by the Dutch revolt from Spain. Whereas many other European countries during this period experienced a consolidation of absolutist rule, the Dutch managed to escape. This allowed them to preserve a relatively open society in which cities were autonomous and ruled by local merchant elites. They cooperated and competed with one another in producing an economically open society. This was coupled with ecological crises that damaged the ability of the Netherlands to feed its own population, forcing the Dutch to engage in foreign trade to acquire the grain it needed. They had to industrialize to pay for that grain. That basically drove the center of European capitalism from Northern Italy to the coast of the North Sea in the Netherlands."