The Rise of Commercial Empires: England and the Netherlands in the Age of Mercantilism, 1650-1770 (review)

This is an important book. It tells the familiar story of Dutch and English economic competition in the seventeenth and eighteenth centuries in a new context and, by doing so, it offers fresh insights into the development of the global economy and the role of the state in economic development.

The book consists of three parts and an introduction. In the first chapter the author discusses the central themes of the book. What is the relevant unit of analysis: the nation-state, the region, or the world-economy? Based on Wallerstein's World Systems approach, Ormrod believes that it is the world economy that matters in the end. But he is a follower of Wallerstein's ideas in its Braudellian version: he thinks that, although the colonial trade has its story to tell, the real battleground between England and the Dutch Republic was the North Sea Zone. Moreover, he agrees with Braudel that the transition from the city-centred economies to the national economies provides the central background. In this chapter he also sketches the main differences between the Netherlands and Britain. The former was aweaker state than the latter, and, more important, its tax burden around the turn of the century was already so high that it could not be further raised, and it therefore ran into difficulty defending its commercial interests.

After this introduction, the following two chapters describe the general development of English and Dutch economic rivalries during the second half of the seventeenth and into the eighteenth century. Ormrod attaches much importance to the Navigation Acts and the changes in the economic and financial affairs of the state after the Glorious Revolution. These changes resulted in an internal free trade zone and external protection.

The second part of the book consists of five chapters: detailed studies of the wool market, linen market, colonial goods market, grain market, and energy market. In these chapters Ormrod investigates the development of these markets, the role government played by giving subsidies or protection, and the changing organization of the market.

In the third and final part Ormrod narrows his focus to two important explanatory themes: the development of the shipping industry, and the growing role of protectionism and international relations in the field of economics. In the last chapter he presents his conclusion that it was the Mercantilist State that shifted the balance of power and influence to London. It provided London with an integrated home market and protected its commercial interests abroad. He concludes that "In the pre-modern world, commercial growth . . . depended substantially on geopolitics" (p. 350).

It is an antagonizing paradox that a book that attacks the notion of the importance of nations as a unit of analysis, and pleads for the use of regions and the global, ultimately concludes that the rise of national economies made the difference between the economic fortune of the Dutch and the English. This is a well-researched, well-written and well-documented book. The author is aware of the older and recent literature on the topic (both in Dutch and in English). He gives a clear overview of existing perspectives, while his own presentation is grounded in new approaches on institutional economics and world systems theory. It is a book in its own right, but he is clearly, although not explicitly, in discussion with other recent books, such as Jonathan Israel's Dutch Primacy in World Trade, 1585–1740 (1989) and, even more so, with the recent widely acclaimed book by Jan de Vries and Ad van der Woude: The First Modern Economy: Success, Failure, and Perseverance of the Dutch Economy, 1500–1815 (1997).

Ormrod makes it evident that economic developments should not be analysed within the national framework. He demonstrates how developments in the North Sea Zone were linked with those in the Atlantic and the Asian trade. Therein lies another...