AN ECONOMIC HISTORY OF THE EMERGENCE OF
CAPITALISM IN EUROPE
PAPER CODE: MHS–111
SUBMITTED BY
NABEEL P R
202406296
FIRST SEMESTER, M A HISTORY
DEPARTMENT OF HISTORY AND CULTURE
SUBMITTED TO,
PROF. RAVINDRAN GOPINATH
INTRODUCTION
Since formalism in history carries out a significant lore in the ongoing academia, the
analysis and identification of developments and stages in history with proper
structural boundaries tend to be very normal in our studies. Stages and transition
periods often observed to be vital in these fields. Even though there were attempts to
periodise history in terms of various paradigms from the names that stretches from
ibn Khaldun to Adam smith and even Hegel it was Marx who gave a proper
periodisation of history that based on historical materialism. The stages of historical
materialism in A Contribution to the Critique of Political Economy (1859)1 became the
base for most of the rational studies that followed later on exceeding the boundaries
of Marxist and non-Marxist paradigms. Over the period, finding out the ideal
representatives of each stage and figuring out the points of transition from one stage
to other came as some serious speculation in the market of historiography. Here by
having two ideal texts that I can rely upon the lore of transition debate, and both of
them places their prime movers in different poles, the abstract idea that conceives is
more or less similar. the assignment goes on in a way explaining the matter of
transition debate by going through the metanarratives we have and an introduction
to the observations of North and Dobb, the accountability in both claims, and finally
to an attempt of finding out the prime mover over the whole approaches. The
sources I relayed is basically the two standard texts that of The Rise of the Western
World: A New Economic History (1973) by Douglass C. North and Robert Paul Thomas
and Maurice Dobb’s monumental work in the title of Studies in the Development of
Capitalism (1946). And I referred to some other texts that tend to be the extension and
completion of both views.
A TRANSITION IN MAKING
E H Carr in his book, titled What is History (1961) discusses a statement by C P Scott’s
one editorial from The Guardian that came out in the early years of twentieth
century that moves along the positivist approach in history as, facts are sacred and
opinion is free2. Throughout the discussion over transition debate from Dobb and
Sweezy through n number of prime movers to the framework of Douglass North on
the role of institutions, what we are seeing out is all of the replica of this positivist
approach, like being there the facts that has almost unanimously approved among
almost every schools of matured historiography, discussions on the intensity of each
factors its range begins from population, and goes through trade, towns, even
climatic and ecological factors and ultimately to the New Institutional regime of role
of institutions in framing property rights and the following social formulations and
transitions by chance.
1. Marx, A Contribution to the Critique of Political Economy, 1859, p.22
2. Carr, What is History, 1961, p.8
Soon after the scene of second world war, there was an urge in the British
historiographic academia alongside the Marxist school with the figures like E.P.
Thompson, Eric Hobsbawm, Christopher Hill and Maurice Dobb to have a solid base
for Marxist understanding of the western history, and obviously their primary focus
was on class struggles followed by industrialization by late 18th century. And further
attempts came to the enquiries about the origin of capitalism and that’s how there
was a need for finding an answer to the period of three or four centuries between
fifteenth and eighteenth in connecting feudalism and capitalism. Maurice Dobb was
one among the first economists who argued that economics has to reviewed on
historical base. Naturally the general metanarrative that largely influenced by the
idea of reemergence of trade and Islam in the decline of feudalism and the
emergence of another political economy has been challenged and his major focus
was on the internal causes that formulated the transition rather than something
that’s external completely shaking up the economic order. And looking at the total
lore from 2024, that have covered at least a dozen of viewpoints over the transition
debate it is obvious to ask that why do we actually need a prime mover to explain
transition debate while it can be diplomatically formalise a comprehend image that
covers almost every factor with equal responsibility to the being. Leaving apart the
main course of what was actually the lived reality, the major problem that underlies
here is about the way that we read out history. It is very casual as well as immature
to narrate the realm over the speculations of those factors which are of population,
trade, towns, technology and class struggles, having an observation about the
concept of a prime mover which has its essence all over the other facts put forward
an idea that of systematic and compound figure of a time period that can be viewed
through mathematical explanations and empirical data, and after all the paradigm of
historiographic schools and their emphasizes which each of them has a considerable
respect in postmodern academia is also push for a better need of a prime mover
among the other movers. Henceforth we will be going through such a way that
seeing the core idea that’s being discussed in both Dobb’s and North’s text and a
concluding section where we will check the accountability of both sides in terms of
measures that widely considered to be very feasible in neo economic history.
CHRONICLERS OF THE CHANGE; A TEXTUAL PERIPHERY OF DOBB AND
NORTH
Prior to get in for the contextual imagery of prime mover that comes from both
Maurice Dobb and Douglass C North, I just like to have a sudden covering over the
abstraction of both in subsurface. Primarily talking about the language of both texts,
it is merely a gradual expansion of total way of transmitting that casually took place
in forty years. While Dobb uses simple yet a bit complex in the formulation of
sentences, North’s and Thomas’s text is very casual in terms of expressing things.
When North’s text has a peripheral construct over the general chronology and even
that focuses inside the perfect regional boundaries which aptly fit with his focus of
consideration, Dobb’s explanation stands upon a more factual oriented analysis
which constructed over a vivid and subjectively constituted framework. And of
course seeding an almost similar image of basic factual developments of the period
both of their stress over the prime mover has deep rooted distinction that stands
over the theoretical framework where their works has been installed. What I am
trying to add further on in this session is only about the briefing of both texts and
their core crux, where they studied about the decline of feudalism and its movers.
Maurice Dobb has written his text on eight chapters which deals with distinct
elements that constituted the growth of capitalism from the grave of feudalism in
general. Over the analysis of themes like concept of capital and capitalism in history,
decline of feudalism, growth of towns, accumulation of capital, mercantilism and
finally into industrial revolution and aftermaths he drew a comprehensive image of
total economic history of western capitalism’s rise from a Marxist perspective.
Where first three chapters often more accountable to the theme that we are in
discussion, the transition.
A definition Dobb gives to ideal feudalism goes on like, an obligation the producer
by force and independently of his own violation to fulfil certain economic demands
of an overload, whether there demand take the form of services to be performed or
off dues to be paid in money or in kind3. And interestingly his work starts with the
discussion over the concept of capitalism in wider sense. Quoting Marx he concludes
the system of capitalism as, simply not a system of production for the market, but a
system of commodity production where labour power itself became a commodity
and bought into market like any other object of exchange4. In short, other than
merely a system where only outcome and the process of production put under
change, it was more likely a relation of capitalist and working class. As the
benchmarks have been made on point, it is actually rational to formulate junction
where the conceptual transition takes place and its prime mover. Each mode of
production must gained its basic form over the womb of previous system, Dobb was
very peculiar about this theory that economy and economic changes has to reviewed
from a historical perspective. An attempt to define class in history goes on contrary
to the metanarrative people of same wavelength in terms of income scale or other
identities rather it is of unification by aims. Over the constitution of the contextual
clarity about the transition he comes up with the factual locus that has discussed
later on in detail like, merchant capital, modifications in prevailing patterns like
putting out system, the transformation of markets and towns by wider sense,
development of nation states and ultimately the technical change, where everywhere
he discusses about the concept of class and related affairs that underlies.
3. Dobb, studies in the development of capitalism, 1946, p.35
4. Dobb, studies in the development of capitalism, 1946, p.7
Feudalism, in its classical form was a system where political power was determined
by land tenure and that has been legitimised by the granting of justice in return to
obligation and rental rights. Dobb, like any other economic historian who worked on
modern Europe was aware of the significance of 11th and 12th centuries and how
crucial was that in altering the mere image of feudal system by wider means. But the
major discussion he drags out later on is all about was that sufficient to put a full
stop in the decline of feudal order by quoting Engles of having an opinion on second
serfdom as a revival of old system which was associated with the growth of
production for market.5 But with wider analysis it was crucial in terms of changes
like increase in demand for lords, the information and accessibility to new luxuries,
attempts in increasing production and resource by many means, systems like leasing
out land and even sub infeudation. But in general sense the response of feudal lords
to the ongoing events was not uniform as the more or less same paradigm
strengthened serfdom in eastern Europe and that has a destructive essence in
western side. Role of institutions in determining this divergence has widely even
recognised by Dobb himself with rolling up the cases of England, France and
Flanders in general. Further on the substitution of money wage, social differentiation
within peasantry due to the leasing out system that has previously mentioned, the
going back to inefficient farming systems that could only adopt with the new land
patterns, mercantilism and as the out product, ultimately the total metamorphosis of
the nobility system by 15th century paved up the total essence of change, and
considerably Dobb left a big space to discuss the relevance and role of towns. Even
though towns were not some alien phenomenon to feudal societies, the towns came
in proximity by the dawn of 15th century was significant in the total figure. Vaguely
it is considered to be at least four types of towns by the towns in terms of its origin.
The revived roman towns, towns that recently came up with rural origin, those
towns emerged with the foreign caravans like Pirenne focused upon, and those of
the sanctuaries granted by the feudal authority6. What actually the presence of towns
indicate is not only about the general possibility of new professions and
opportunities, but rather the solid base for segregation inside the urban population
along the social classes up there.
Dobb’s further emphasize actually lays on the counter possibilities like the question
of if towns were there for a long period of time, why does capitalism has lagged
much of centuries. Here what Dobb interestingly possess is about the idea of feudal
soul in terms of relations in many of the new urban centres.7 Where he finds out a
proper distinction is the possibilities for accumulation which refereeing Marx in
contrary to Adam Smith’s idea of ‘produced wealth’.8 Role of the newly emerged
urban class was vital in determining the political order and economic pattern.9 The
5. Dobb, studies in the development of capitalism, 1946, p.39
6. Dobb, studies in the development of capitalism, 1946, p. 72, 73, 74, 75, and 76
7. Dobb, studies in the development of capitalism, 1946, p. 83
8. Dobb, studies in the development of capitalism, 1946, p. 87
9. Dobb, studies in the development of capitalism, 1946, p. 88
extend of the observation actually reaches up to the external sources of accumulation
with reference to joint stock companies and equally its wide range impact that
reflected in the whole spectrum of society. further on stretching up with the same
genre Dobb tries to demonstrate the growth of bourgeois and their accumulation of
capital wealth by various measures in following chapters.
Douglass North with Robert Paul Thomas, worked on the text titled the rise of western
world, a new economic perspective in 1973 had a different outlook to the same areas
where major historians have already focused. With the emergence of New
Institutional economics and its theoretical conquest other fields, it was way north to
place in the classical economics lens point rewarded with 1993 Nobel Prize in
Economics. Simply what he was focusing on was about the role of institutions in the
framing of property rights and thus economic patterns. Let me try to brief out the
crux of his ideas.
He defines feudal institution as an arrangement of society based on contract which is
expressed or implied10. Tracing out the inlaying institutional elements in feudalism,
he put forward many instances where old Carolingian, Roman and early Germanic
political entities carried out like the system of court, the oath of feudal submission
and even to the system of homage. Even though the structural composition of feudal
realm was largely unwritten, it carried out through the customary rights in prevail
and the two-way relationship of granting justice and protection in return to
obligation and homage.11 Manor was an administrative body as it was an economic
one. Over the changes takes place in feudal order what North is directing us was
about the changes in property rights and institutional organisations and how come
that became an inevitable cause for the divergence in economic scale inside Europe
from an almost similar background.
Before 900’s land was very abundant in relation with the amount of population. It
was way harder to find out distinct types of land with reference to its kind like the
Common Property Resources and all. Labour generally considered to be the
examination of the existing nature of property rights in man12. But the scene did not
last for long, with the end of 10th century, increase in population, an obvious scarcity
in land, lord’s urge to increase revenue and changes in the pattern of families has
came up. Affiliated with the technological changes, societal patterns and effect of
crusades, now the forms of development of western world was slowly shifting to
northern Europe from Mediterranean. Development of trade with involvement of
new commodities like timber, iron and other metal products, spices, perfumes,
ivory, textiles and oil made long lasting change in totality of lord’s life in general.
Water and wind power replaced animal and manpower for many instances and by
extend the feudal obligation get in to the form of money rental payment. Frontier
10. North & Thomas, rise of western world, 1973, p.9
11. North & Thomas, rise of western world, 1973, p.9
12. North & Thomas, rise of western world, 1973, p.20
movement and three field rotations by larger extend took the situation to another
extend.
While having a discussion about thirteen century Europe when frontier movement
has come an end and population was in its steady growth,13 it is inevitable ask how
come certain European states overcome the Malthusian checks. North argues it
happened because of the way property rights that developed, or failed to develop
during this time. The locus of government coercion shifted from local to larger
political units. The strengthened states were very cunning about the ongoing
developments. North suggest example of two charter acts from 1203 and 1210 which
clearly shows changes in the major sources of revenue and the changing property
concepts and mode of taxations14. And the following century that is fourteenth was a
period of Malthusian checks by a general speculation. Black death, famines and wars
shook the system’s foundation by larger extend as the high rated fluctuations in
population that occurred by the time. One group who gained from the scene was the
nation states who were seeking for a sound cause for the decline of the obligatory
manorial systems, by the middle of 15th century nation states became the general
political unit among western Europe, naturally the institutional arrangement went
through a proper standardisation. Now state became the absolute monopoly of
protection and justice and obviously the soul authority of tax and constitution of
property rights. And that became more evident and peculiar with the coming up of
instances in early modern period like price revolution, commercial revolution,
reformation, voyages, and world market.
Nature of property rights decided the efficiency and inefficiency of the ongoing
systems. The decision between private return and social return was vital.15 Further
on what North focuses is about the divergence happened among the western
European states as the successful block including England and Netherlands and the
trailing block that covers states like Italy, Spain and France. Free-simple and absolute
ownership in land lead to improvement in agricultural productivity, free labour
market and privately owned goods made the process more favourable to the
ongoing changes. While in Spain it was more of a rigid control and labour hindered
economic mobility, same as in France they sticked up with protection of regional and
traditional monopolies. Rather on the political centralisation in France and Spain
was standing over the expense of representative institutions16. In wider sense role of
certain social groups like Mesta in Spain, who had important role in deciding the
misalignment between private and social returns. In France too the presence of
traditional guilds kept through no change over a large period of time. The motive of
taxation also was maximisation of revenue by any means without having a proper
vision of long-term stability. Unlike England and Holland in France and Spain
13. North & Thomas, rise of western world, 1973, p.46
14. North & Thomas, rise of western world, 1973, p.66, 67
15. North & Thomas, rise of western world, 1973, p.6,7
16. North & Thomas, rise of western world, 1973, p.126
property rights were poorly defined and the legal system compounding it stood for
protecting the interests of elites than a further economic growth. In contrast England
and Netherlands had comparatively better politically representative and
decentralised institutions that moulded up with Cromwell and Glorious revolution,
institutional innovations like joint stock companies, well defined property laws,
navigation acts, well established financial institutions like Bank of England
improvements in ship building, commercial hegemony to many oversea lands and
better advantages in their competition with neighbouring states like Spain and Italy.
CROSSCHECKING THE SCHOOLS, MOULDING OUR TRANSITION;
CONCLUSION
This is the concluding section where I want to wrap up the sides which we have
discussed so far with some systematic crosschecks. It seems like we may begin from
North and discuss the underlying crux of it and move to Dobb by having a proper
discussion on the matter that he often posses.
By 1970’s and 80’s there was this urge among economists especially in the U.S came
up with a new school in economic analysis called New Institutional Economics that
meant to oppose both classical model and neoclassical. Douglass North, Ronald
Coase, Oliver Williamson and many other prominent figures were there at its
pioneering face. Institutions and their role in framing economic patterns,
evolutionary approach in history, role of transaction costs, Information asymmetry
etc were focal in their concerns. Technically from classical and neoclassical models
the new institution model economics decreases the passivity of economic models.17
And coming to the lore like how does new institutionalists explain the working of
market it often connected with the role of institutions and their role in stimulating
demand and supply in terms of the control they have over transaction cost and
information distribution. It can be represented in graph like the following.
17. In terms of the indicators. Reducing passivity in an economic analysis doesn’t mean
it’s a perfect and better model.
Figure 1 model of market forces in
new institutional economics
While reading North the actual
emphasis of his concern falls
over the same lores like how far
institutions were defined and
accountable, how far they were
important in determining the
property rights and taxation
policies, how far they were
responsive to the ongoing
changes and how far they were
prone and adaptive towards the
changes.
But actually the problem came
up with New institutional
economics has been criticised
by old schools in terms of overemphasis on institutions in terms of vaguely defining
institutions, the formal and informal institutions and the distinct spheres of their
role, endogeneity of institutions as the byproduct of ongoing social and economic
political tenures, difficulty in measuring institutions, and the problems that occurs
when it comes to complex economies. While explaining how the market functioning
in NIE model there are such loopholes like assumptions like everybody engages in
economy is trying to maximise either utility or profit, static position of institution,
insufficient attention to distributional outcome, limiting empirical testing, etc.
Placing the realms to context of feudal decline which North argues the same
loopholes has infinite scope.
Coming to Dobb, as he was propounding the idea of internal contradictions as the
mover of transition from feudalism to capitalism that focus more on class relations
and primary accumulation. The areas which he leaves out the discussion has been
kept though deep improvements by later schools in terms of finding a proper prime
mover of the scene. Among the factual scenes he may left out like, population,
technology, towns, trade, institutions and class struggles, over the theoretical
accountability and empirical data, for the most time it falls over the class relations.
The problem in explaining the transition actually get a dividing point with any other
factors as placing it for the prime mover, when a comparative study between eastern
and western Europe occurs and question arise then why did feudalism went a
distrust only in the west. In fact even standing out in a school which rooted up in
non-Marxist realm, even though his major emphasis was on the role of institutions in
shaping the economic pattern the actual focus falls on how a certain group has
emerged among the total mass who were capable of doing something and how
institutions became the promoters of them.
The concept of transition debate has been there in our syllabus for almost two years.
But actually exploring the class notes and refined sneak peaks that various
institutions including IGNOU out we had a teleological narrative of a direct shift
from feudalism as a classical entity to capitalism as an another. Even though I was
familiar with the names like Dobb, Sweezy, Hill, Brenner, Poston, Ladurie and all we
had certain two or three sentence explanations and flowed well established and
fortified debates like internal or external, population, class struggle and so on. But
after having a proper access to the original texts from this semester onwards, the
figure was quiet different as the long and complex developments in a span of four to
six and even seven centuries. Understanding on how the social classes were defined
due to the ongoing developments, how does the stratification among the population
became more and more rigid and systematic, how does different factors shaped the
new social and economic pattern were actually peculiar over the time working on
this tutorial.
REFERENCES
1. Dobb, Maurice, Studies in the Development of Capitalism, 1946
2. North, Douglas C & Thomas, Robert Paul, The Rise of the Western World: A New
Economic History, 1973.
