II. AGRICULTURE AND THE BROADER ECONOMY

Quesnay explained in the Tableau économique that the productive class, composed of farmers, was the only one capable of generating the net product. “The sterile class is made up of all citizens engaged in services and tasks other than agriculture, and whose expenses are paid by the productive class and the class of owners, who themselves derive their income from the productive class” ([1758] Reference Quesnay1888, p. 309). In ruling out “services and tasks other than agriculture,” Quesnay overlooked the most rapidly growing sector of the economy. Industry developed at between 1.5% and 1.9% a year, tripling or quadrupling production from 1700 to 1789. The most profitable commercial operations were international trade, which grew fourfold, three times faster than the economy as a whole. The complex of manufacture, marketing, and consumption of fashion goods proved crucial to this capitalist triumph. It increased labor productivity by enhancing consumer desire and thus sale prices relative to manufacturing costs (Sewell Reference Sewell2021, pp. 46–47, 50–51, 104–106, 127, 228–229).

The physiocrats’ insistence on farming as the uniquely productive activity is understandable when one bears in mind (Charbit Reference Charbit2002, pp. 858–859) that they lived in an agricultural country in which most of the population made a living from growing crops and rearing livestock. Farming contributed four-fifths of the country’s wealth, not counting textile and small metallurgy production in the countryside as a complement to fieldwork. The physiocrats saw that the rents paid by tenant farmers and sharecroppers, not to mention the royal tax revenue, came from agriculture and sustained the king, receivers of tithes, and landed proprietors. Their knowledge of the economy came from their correspondence with farmers and agricultural societies (Charbit Reference Charbit2002, pp. 858–859).

The physiocrats thus regarded the increase of the organic substance as the increase of economic output. They artificially placed profits in manufacturing costs to maintain their theory of the unique profitability of agriculture (Rubin Reference Rubin and Filtzer1979, p. 129). Turgot, though in agreement with the physiocrats on other issues, advanced a dissenting view, in Reflections on the Formation and Distribution of Wealth (1770), by including workshops, commercial enterprises, and finance with landed property as profitable investments (Steiner Reference Steiner, Samuels, Biddle and Malden2003, pp. 73–74). Pierre Samuel du Pont de Nemours, a disciple of Quesnay—in publishing Reflections in Les Éphémérides du citoyen, the main periodical of the physiocratic movement—realized that Turgot’s description of profit diverged from Quesnay’s theory of the unique productivity of agriculture. For the physiocrats, accruing profit meant removing funds from circulation and interrupting the cycle of agricultural investment. To minimize this divergence and defend physiocracy, du Pont stated that Turgot did not describe the removal of profit from circulation. Rather, he explained Turgot’s description of monetary gains as a deferred form of productive expenditure on agriculture at a later date.Footnote ²

While the physiocrats’ view on agriculture arose out of its historical context—and while it faced the differing opinion of one of its supporters, Turgot—it still makes sense on purely economic grounds. The physiocrats’ point was that for trade and industry to grow durably, they required a dynamic agricultural economy. Historians have alluded to this point without explaining it (Vardi Reference Vardi2012, p. 114; Coleman Reference Coleman2021, pp. 231–233). In the essay “Tenant Farmers” (Fermiers), published in Encyclopédie ([1756] Reference Quesnay and Daire1966, pp. 230, 245–247), Quesnay argued that investment in large farms in areas with the best soils would generate more than enough grain for national needs. Other farmers could then rear livestock and poultry, and farm flax, hemp, herb gardens, and vegetables. “Flax, hemp, wool, silk, etc., would be the raw material for our manufactures…. Wine, brandy, leather, salt meat, butter, cheese, fats, tallow, linen, rope, cloth, fabrics would be the principal items of our foreign trade” (p. 244). Quesnay urged his readers in “Hommes,” written for Encyclopédie, though never published at the time ([c.1757] Reference Quesnay1966, pp. 558–559), to produce “hemp … [and] woolen fabrics…. The product will … multiply wealth; and these ever-resurrecting annual riches will ensure us manufacturing and industrial works of all kinds.” In sum, the small portion of the realm best suited to arable farming would generate bread grains for people to purchase subsistence, and the rest could be turned over to livestock and industrial crops to spur the development of commerce and manufacturing.

Quesnay wrote in “Tenant Farmers” (pp. 238–239) that productive agriculture lowered the prices of butter, cheese, eggs, and vegetables. It made clothing and other items of basic necessity more affordable because “expensive foodstuffs augment the workers’ salaries” and thus the costs of manufactured goods. Quesnay stated in “The General Maxims” in 1767 that salaries boiled down to a “daily wage of the laborer … fixed more or less naturally on the basis of the price of corn” ([1767] Reference Quesnay and Meek1962, p. 258). He explained, in an essay on grains ([1757] Reference Quesnay and Daire1966, p. 302) published in Encyclopédie, that the greater the agricultural output—controlling wage costs for employers— “the more commerce, manufactures, arts, crafts and other professions become lucrative.” Without agricultural abundance, the “consumption sustained by luxury is too limited; it can only support itself through opulence, those without much wealth cannot indulge in it” (p. 253).

Turgot elaborated on these statements about agriculture’s contribution to the broader economy in Reflections, articles in Éphémérides, and various letters from the end of the 1760s and 1770 ([1913–1923] Reference Turgot and Schelle2018, vol. 2, pp. 24, 476; vol. 3, pp. 122–123, 312–313). He distinguished two prices: the one established by supply and demand, and the fundamental price or cost of production. Turgot wrote over and over that while the supply of and demand for workers contribute to the price of labor, this price, even under conditions of intense competition for jobs, does not fall below the cost of the workers’ subsistence: “In all types of work, the worker’s salary is limited by competition to what is necessary to provide him with his subsistence” (vol. 2, p. 27). Turgot (vol. 2, p. 261) maintained that agricultural investment, by increasing production, stabilized food prices, and left employers with a manageable wage bill and higher margins. They then had capital to invest and expand employment and commodity production. Citizens, paying stable food prices, had more income to spend and “obtain the … conveniences of life, better clothing, greater cleanliness, which are of inestimable advantage for the preservation of health” (vol. 3, p. 257). Thus, for Quesnay and Turgot, commerce and manufacturing, to develop sustainably, required investment in agriculture to stabilize food prices, control wage costs, give employers the margins to invest and increase output, and give citizens the discretionary income to spend on consumer goods.

III. AGRICULTURAL DEFICIENCIES

To explain why agriculture did not develop in this way, to the benefit of commerce and manufacturing, the physiocrats drew on an antimercantilist discourse originating in 1699 with François Fénelon’s Télémaque. Using this line of reasoning, writers argued that the state promoted industry over agriculture, cities over the countryside, merchants and artisans over nobles and peasants, and artificial commercial wealth over genuine rural prosperity. The discourse became gendered after Quesnay’s time, as women played a role in fashion, taste, and consumerism, and authors blamed Marie Antoinette’s extravagant expenditures for the bankruptcy of the nation, which would regain public spirit only once it gave up such irresponsible habits (Crowston Reference Crowston2013, pp. 283–284; Kwass Reference Kwass, Kaplan and Reinert2019, pp. 117–118).

In line with this reasoning, Quesnay argued in “Tenant Farmers” against commerce, manufacturing, and other sterile pursuits, which drew funds away from cultivators. Sterile pursuits diminished investments in agriculture, the uniquely productive activity that expanded wealth every economic cycle and spread it to the entire realm (Larrère 1992, p. 192). Although luxury spending, Quesnay claimed in “Tenant Farmers” ([1756] 1966, p. 247), led to flourishing trade, it consisted solely of the circulation of money and brought about no real increase in wealth. He made the case in “Hommes” that as merchant trading becomes indispensable, it “diverts pecuniary wealth from productive sources; not only do the discounters’ treasuries not contribute to the reproduction of wealth, but they also take away the wealth which circulates, and little by little drain all the fortune of the nation…. The capital brings together all the money of the kingdom” ([c.1757] 1966, p. 566). Quesnay ([1756] 1966, pp. 244–247) wrote in “Tenant Farmers” that nobles and wealthy people reside in the cities and spend the income of the kingdom there. Their expenditures attract a multitude of merchants, artisans, domestics, and unskilled workers. But the urban luxury trade does not increase the agricultural surplus or generate raw materials, such as hemp and flax, for manufacturers: “Any other trade that is not based on these foundations is uncertain.” Quesnay resolved that “the downfall of an empire has often followed closely upon a flourishing commerce,” because “almost all the money is used for a type of commerce that does not increase the wealth of the nation” (pp. 247–248). He concluded in “Grains” ([1757] 1966, p. 294) that “in reciprocal trade the nations that sell the most necessary and useful goods have the advantage over those who sell the items of luxury.”

Turgot ([1913–1923] Reference Turgot and Schelle2018, vol. 1, p. 332) made the same point, in remarks written in the early 1750s, that “the only true wealth was the production of useful materials.” He argued, in a text on political geography written in these years, that, rather than encourage such production, Paris had become “an abyss where all the wealth of the State is absorbed, where manufactures and trifles attract money from all of France through a trade … ruinous for our provinces…. Most of the tax revenue is spent … [in Paris]; and the little vanity of those who govern, combined with their ignorance, does not fail to accumulate all the new manufacturing there” ([1913–1923] Reference Turgot and Schelle2018, vol. 1, pp. 389–390).

Quesnay and Turgot, in these ways, described manufacturing and commerce as activities supported by wealth taken from the countryside, and as causes of rural poverty and impediments to broader development. The English writer on agriculture Arthur Young ([1792] Reference Young1969, pp. 432–433) observed similarly in the late 1780s:

Scholarship has substantiated these observations by describing royal taxes, seigneurial dues, and tithes as resources wrung from rural inhabitants and as causes of the poor state of agriculture. Tenant farmers and sharecroppers, in addition to bearing these burdens, paid rent in kind, cash, or labor, and sometimes all three. A survey of the foregoing exactions suggests that they amounted to between a fifth and a half of the crop. “The … wealth of the realm is mainly produced … [in the countryside], and those who reap the greatest rewards are mainly elsewhere.” The beneficiaries consisted of well-off commoners, who did not go to the countryside very often, and nobles, all but the poorest of whom resided in the towns (Goubert Reference Goubert and Cox1969, pp. 101–102). The Saulx-Tavanes family, to take a case in point, lived mostly in Paris and had immense expenses for the luxury consumption incumbent on illustrious nobles. Family members defrayed some of the cost thanks to pensions paid by the king out of royal taxation to reward their history of service to the Crown. Their estate agents also helped them cover the costs of living nobly in Paris by carefully negotiating leases and enforcing seigneurial dues. The Saulx-Tavanes family instructed the agents to avoid outlays on improvements, even current repairs, for the “rents will rise anyway,” as they saw with each renewal in the 1770s (Forster Reference Forster1971, pp. 10, 17–20, 205–207).

Outside the Paris region, in Lyonnais, lords, ecclesiastics, and bourgeois office holders, professionals, and other creditors drew wealth to their town residences through seigneurial rights, land rents, tithes, and loans. Sharecropping and rental agreements specified deliveries in kind for the proprietors, residents of Lyonnais towns, to sell on the market or enjoy at the family table (Dontenwill Reference Dontenwill1977, pp. 153–155, 157–159, 161; Garnier Reference Garnier1982, pp. 363–364). In Poitou, proprietors, merchants, office holders, and their agents lived from the monetary sums, seigneurial dues, and rents in kind, such as grains, poultry, butter, flax, and wood, carted to their residences in the towns of Fontenay, Parthenay, and Poitiers, according to the terms in leases, by smallholders, sharecroppers, and tenants. Proprietors lived from their lands like the nobility did and reinvested minimally in their rural domains (Péret Reference Péret1976, p. 225; Guillemet, Pellegrin, and Péret Reference Guillemet, Pellegrin and Péret1981, p. 12; Legal Reference Legal1995, pp. 331–332). Similarly, the wealthy residents of Bourges, Châteauroux, Issoudun, and other towns of Berry lived from poultry, butter, pork, wines, and other shares of harvests transported to their barns by their tenants (Gay Reference Gay1967, pp. 276, 330).Footnote ³

IV. MARKET INCENTIVES AND AGRICULTURAL INVESTMENT

To return this wealth to the countryside, Quesnay and Turgot proposed free trade, including exports, which would increase demand and prices and create incentives for agricultural investment (Steiner Reference Steiner, Samuels, Biddle and Malden2003, p. 65; Kaplan Reference Kaplan2017, p. 800). Physiocracy fashioned conceptions of capital and development “geared to … the interests of the elites in all three Estates whose wealth was primarily landed and agricultural” (Kaplan [1976] Reference Kaplan2015, p. 152). This “proprietary class,” in physiocrat terminology, along with farm operators and grain growers, who together disposed of the marketable surplus, favored liberal policies likely to increase rents and profits. Physiocracy had roots in the landed classes and adopted their position that stagnation resulted from gluts, low prices, and lack of outlets. Intendants and subdelegates, they believed, shared the prejudices of royal subjects in favor of the complex regulations on the grain trade. Police officials feared unrest from people inclined to hold the monarchy responsible for scarcity. The common sense among landowners was that royal regulations rendered cultivation economically unattractive (Kaplan [1976] 2015, pp. 101–102, 122, 129, 132, 153; Charbit Reference Charbit2002, pp. 858–859).

Quesnay argued in “Tenant Farmers” ([1758] 1888, pp. 175–176) that in England the removal of regulations resulted in favorable prices, a steady stream of investment, and regular abundant harvests. In France, with regulations on the grain trade, “the low price of wheat … determined the farmer to … neglect agriculture” with the result that when prices rose, farms were in poor condition and the country suffered from dearth. Turgot wrote ([1913–1923] Reference Turgot and Schelle2018, vol. 1, p. 332) in the early 1750s, with regard to the mercantilist Josiah Child, that price controls created unjust inequality beneficial to the buyer but detrimental to the property rights of the seller, even though the latter’s productive work furnished the needs of society. He wrote (Reference Turgot and Meek1973, pp. 154–155) years later in Reflections that the inability to find good husbandmen and investors resulted from low prices preventing tenant farmers from profiting from leases.

This assumption of the landed classes, that commercial opportunities created incentives for investment, revealed contradictions noticed by contemporary critics. To begin with, Quesnay and Turgot never squared the circle between the high commodity prices needed to spur investment and the low prices needed to reduce labor costs for employers and increase discretionary income for consumers. In Turgot’s words, “as a rule the necessary proportion between the price of foodstuff and the price of labor must subsist” ([1913–1923] Reference Turgot and Schelle2018, vol. 3, p. 315). This rule contains the basic principle of price and profit, though Turgot did not fully explain it. As commodity prices rise, so should production and the demand for labor, encouraging an increase in the number of wage earners, or wages, or both. The economic demand for corn would rise to meet the increased production (Steiner Reference Steiner, Samuels, Biddle and Malden2003, p. 71; Charbit Reference Charbit2002, p. 872). Quesnay similarly argued in “Grains” ([1757] 1966, p. 302) that an increase in agricultural prices hardly raised consumer costs and that wages, in any case, would increase proportionately. This increase would be a small matter for agricultural employers in comparison to the wealth to be gained from remunerative wheat prices. For the physiocrats, high grain prices translated into an increase in the net product, the motor of economic growth, and thus indirectly led to demographic growth through the demand for labor in the countryside where was is most valuable to the nation.

Quesnay, however, in the same passage where he made this argument about the parallel increase of grain prices, production, wages, and population, seemed to acknowledge the tendency of market liberalization to raise prices to the detriment of workers. He wrote ([1757] 1966, p. 302) that, as people grew accustomed to excessively low wheat prices, they became lazy and arrogant and ceased working diligently. In times of abundant harvests, farmers had difficulty finding workers and servants. The common people had to be pressed by the urgency of high prices to work assiduously for wages. In reality, contrary to Quesnay’s argumentation, peasant smallholders, who made up the majority of rural inhabitants, often supplemented subsistence farming with purchases and faced more menace from high prices than from low. They did not share the interests of substantial tenant farmers, farm managers, and comfortable landowners (Kaplan [1976] 2015, p. 153). Simon-Nicolas-Henri Linguet, a critic of the physiocrats, pointed out this conflict of interest. He argued in the 1760s that, in times of high prices, wage earners did not dare press for better pay and consequently suffered without food (Van den Berg Reference Van den Berg1998, pp. 157–158; Vaggi Reference Vaggi1987, p. 178).

Linguet’s criticism matches the conclusions of modern research, that prices turned in favor of agriculture after the 1730s and 1740s, but that wages, contrary to the physiocrats’ expectation, did not keep pace. Farmers and proprietors brought market power to bear with the aim of augmenting profits, as the other classes, especially urban and rural workers, experienced stagnant or declining standards of living (Vaggi Reference Vaggi1987, p. 178; Labrousse [1932] Reference Labrousse1984; Béaur Reference Béaur2000, p. 294). As Clare Crowston writes, “economic capital in terms of money, wealth, and property was one crucial way of assessing value, but … not primordial.” People sought more exactly to gain “advantage in the struggle over limited resources,” and these resources included “power” (2013, p. 15). Indeed, Forbonnais observed in 1768 that rural markets did not conform to the physiocrats’ theory of favorable prices, abundance, and general wealth. He described a dual economy. On the one hand were wholesale merchants of the urban areas, where capitalists sought the highest rate of return on competitive markets. On the other hand were the hardly monetized rural areas fragmented in an infinity of local markets, where small farmers, in need of money, had to sell right after the harvest. Slightly better-off médiocres farmers then sold their grains for a modest profit. These sales maintained low prices and a false sense of abundance. Capital, however, belonged to large domains where proprietors stocked grain in anticipation of better returns. They sometimes speculated following poor harvests in times of scarcity and high lucrative prices (Charles Reference Charles2008, pp. 86–91).

Diderot made a similar argument—renouncing his physiocratic ideas of the 1750s when he published Quesnay’s articles in Encyclopédie—after traveling around Paris and Langres and witnessing scarcity at a time when the monarchy, influenced by the physiocrats, removed controls on the grain trade (Larrère 1992, p. 14; Soliani Reference Soliani, Klotz, Minard and Orain2017, p. 111; Kaplan Reference Kaplan2017, pp. 257, 269–272, 794, 796, 807–808). In Apologie de l’abbé Galiani (1770), Diderot contended ([1770] Reference Diderot1998, p. 80), like Forbonnais, that the physiocrats mistakenly envisioned the flow of grain on a free market to areas of shortages and high prices. Many people hoarded grain for fear of scarcity and dearth, and well-to-do inhabitants stored surpluses and waited for higher prices. Whereas the physiocrats celebrated well-to-do tenants enriched from trade, Diderot saw a hundred times more small farmers, small tenant farmers, and wage earners in penury forced to sell in times of abundance at a low price to cover expenses ([1770] 1998, pp. 83, 97, 100–101). He believed that the physiocrats’ readers mistook brokers for agricultural entrepreneurs. Brokers inserted themselves between landlords and peasants, paying cash rents to the former to lease many properties and extract payments and surpluses from peasant subtenants, ruthlessly enforcing contracts and gaining leverage on the market to speculate on the grain trade (Klang Reference Klang1998, pp. 428, 430–431, 434). Diderot compared the profits of the lease-holding brokers to the monopoly takings of the king and grandees of Poland. In every region of France, three or four wealthy tenant farmers aimed to control and profit from the grain trade ([1770] 1998, pp. 105, 115, 131).

V. THE PHYSIOCRATS AND THE CONDITIONS OF ECONOMIC DEVELOPMENT

The physiocratic project of society focused on dismantling the complex regulations on the grain trade. Many authors shared its premise that administrative interventions in times of shortages frightened off the sources of supply, drove prices higher, and prolonged public suffering. Police regulations compromised future prospects by making cultivation financially unattractive (Kaplan [1976] 2015, pp. 101–102, 129; Charbit 2022, pp. 858–859). Quesnay argued in “Grains” that the monarchy created fear of famine when it regulated markets to mitigate hardships. Conversely, under “free commerce in grains, one might fear an opposite result. Couldn’t abundant production, which would give France an agriculture raised to a high standard, bring grains down to an unprofitable price?” ([1758] 1988, p. 232). Quesnay foresaw the results of capitalist agriculture, which has tended toward glut and unsustainable prices, to the despair of French farmers since the 1960s (Gavignaud-Fontaine Reference Gavignaud-Fontaine1996, p. 149).

But when discussing the sharecropping, petite culture, and peasant farming of their day, Quesnay and Turgot portrayed an agriculture impervious to the incentive of remunerative prices. Quesnay wrote in “Hommes” ([c. 1757] 1966, p. 553) that subsistence peasants lived in poverty, bought and sold nothing, and served little purpose to other inhabitants. He observed in “Tenant Farmers” ([1756] 1966, pp. 237–239) that sharecroppers ate most of the harvest, whereas if they specialized in marketable commodities, they would bring down prices and give employers a manageable wage bill. Quesnay argued that the lack of tenant farmers led sharecroppers to farm oats, barley, buckwheat, potatoes, and other low-cost subsistence crops requiring little labor or investment. Yet he never explained why or how a great quantity of tenant farmers would prompt the rural inhabitants to give up the light labor and financial demands of subsistence farming for the hard work and costs of specialized market production.

Turgot ([1913–1923] Reference Turgot and Schelle2018, vol. 2, pp. 398–399) claimed—in an essay published in Les Éphémérides in 1767—that in four-sevenths of the realm, one saw only poor peasants equipped with nothing but labor.

Turgot reasoned in Reflections (vol. 2, pp. 473–474) that when people used land for subsistence, they could not be hired for the purpose of market production, profit, and investment. A few years later, as intendant of Limousin, he wrote in a letter (vol. 3, p. 122) that the widespread poverty in the province resulted from peasant subsistence agriculture. He posited in another letter (vol. 3, pp. 312–313) “that general wealth” generated by tenant farmers would offer “enough comfort for [the peasants] to … become accustomed to living on grains and no longer regard other lower-value goods as anything more than an abundant supplement and not as their main food; it is necessary that their wages have risen in line with the price of grains, and not with the price of these same goods.” But given periodic scarcities and low wages relative to grain prices, one has reason to question the likelihood of the rural inhabitant giving up “less laborious” subsistence crops, which “provide him with more abundant food,” to work for tenant farmers. After all, Turgot had written in Reflections that subsistence farmers did not make themselves available for hire.

In a debate with Forbonnais in the 1760s, Quesnay extended this ambivalence about remunerative prices as incentives to investment from peasant farms to agriculture in general. Forbonnais argued against the physiocrats that the diffusion of industrial expertise increased national wealth and motivated farmers to invest in agriculture. Quesnay responded that supposing industrious farmers and an abundance of agricultural commodities over an extended period also supposed investment. Productive agriculture, in this way, spurred the increase in national wealth. Rural inhabitants could not obtain town-produced commodities, no matter how much they might want luxury items, if they could not afford the merchandise. For Quesnay, an increase in economic demand did not spur growth. Wealth first had to be created through agriculture. But in “Tenant Farmers” and other writings, Quesnay argued the exact opposite. He reasoned, like Forbonnais, that liberalization and demand beget investment—in Forbonnais’s case, demand from towns, and in Quesnay’s, from free markets at home and abroad (Charles and Théré Reference Charles and Théré2015, pp. 376–377, 379).

This reasoning informs today’s scholarly consensus, which portrays remunerative prices as the spur to investment and growth, and even the transition to capitalism. According to Jean-Marc Moriceau, a leading historian (Moriceau Reference Moriceau1994a, p. 72), “the Parisian attraction favored a type of agriculture that was early engaged in capitalism. From all sides, it encouraged shaking up the old framework of feudal organization. More broadly, it spread an air of modernity in its nearby countryside.” The latest statement on the eighteenth-century economy (Sewell Reference Sewell2021, pp. 46, 65–66) likewise points to commercial opportunity as the impulse for “greater efficiency … above all in the vicinity of urban areas, where demand was high [and] money circulated freely…. Capitalism … was dominated by … expanding markets and rising commercial culture both within France and across the high seas…. Commerce was the keyword and driver of the eighteenth century.”

Marx and Weber, however, posited, like Quesnay in the debate with Forbonnais, that productive investment does not take place on account of the enticement of gain and the consumption it affords. Marx explained in Capital that “use-values must … never be treated as the … aim of the capitalist…. His aim is rather the unceasing movement of profit-making” ([1867] Reference Marx and Fowkes1990, p. 254). Max Weber, in The Protestant Ethic and the Spirit of Capitalism, dismissed the notion that capitalists pursued “money” for “the uses to which it can be put…. [Rather] a rationalized capitalistic enterprise implies … continual investment and reinvestment” ([1904–1905] 1992, pp. xi, xxxii). According to Marx, capitalists focus on capital accumulation, regardless of the consumer goods it allows them to acquire, because “competition subordinates every individual capitalist to the … laws of capitalist production, as external and coercive laws. It compels him to keep extending his capital, so as to preserve it, and he can only extend it by means of … accumulation” (Marx [1867] 1900, p. 739). “It must be so,” Weber concluded, for otherwise “an individual capitalistic enterprise … would be doomed to extinction” (Weber [1904–1905] Reference Weber and Parsons1992, p. xxxii).

This economic logic did not prevail in eighteenth-century France, where proprietors and brokers, rather than face the competitive compulsion to reinvest surpluses, took revenue from rural inhabitants, as Forbonnais and Diderot remarked, by arbitrating between disconnected markets and appropriating monopoly profits (Lafrance [2018] Reference Lafrance2020, pp. 35, 66, 71, 87). The upper classes also drew wealth from seigneurial dues and tithes, sinecures, venal offices, and other payments taken from royal taxation. Above all, the land rents—paid by what Quesnay considered the productive class of tenant farmers but Diderot regarded as brokers—did not come from investments to improve labor productivity.

Leases assured proprietary incomes, without such investments, due to the ubiquity of the peasant community. Marx devoted the closing chapter of Capital to “primitive accumulation,” or the expropriation of the peasantry, a process he deemed necessary for the creation of “variable capital,” or a commodified labor force, available for purchase like raw material and equipment. Variable capital created additional value for businesspersons who then had to reinvest much of it in continuous cycles of accumulation. Weber likewise argued in General Economic History that “the capitalist form” requires “free labor. Persons must be present who are not only legally in the position, but are also economically compelled, to sell their labor on the market without restriction. It is in contradiction to the essence of capitalism, and the development of capitalism is impossible, if such a propertyless stratum is absent, a class compelled to sell its labor services to live” (Reference Weber and Knight1927, p. 227).Footnote ⁴ In eighteenth-century France, the latest estimate is that “peasants actually owned somewhere over 40 per cent of all land, with households often combining control of small plots with rental of other lands” (Andress Reference Andress2019, p. 27). Even in the region around Paris, the peasants owned about 18% of the land and a much larger share of the land in agriculture. The largest landowners, with residences in Paris, left much of their property in woods to exploit for profit or to partake in hunting (Loutchisky Reference Loutchisky1933, pp. 127, 134; Jacquart Reference Jacquart1974, p. 110; Meuvret Reference Meuvret1987, pp. 88–89, 103; Musset Reference Musset and Antoine2016, pp. 277, 282).Footnote ⁵

In short, the labor force remained reliant on its own subsistence production embedded in the rights and obligations of the peasant community. While it is true that many rural inhabitants worked for wages, such work did not correspond to the reduction of labor to a commodity—dissociated from the community—available on the market for purchase. Permanent agricultural workers, such as domestiques, valets de cour, or garçons de charrue, represented a very small group compared to peasant smallholders who combined farming with wage work. Tenant farmers usually hired peasants—in possession of subsistence plots, including rented ones, and resources available in the community—for specific services, not by the hour, and often paid them in kind (Comninel Reference Comninel1987, pp. 185–186, 189–190, 192–193; Meuvret Reference Meuvret1987, pp. 117–118, 183–184; Ado Reference Ado and Aberdam1996, p. 61). Tenant farmers exploited laborers for profit but, habituated to their permanence on the land and in communities, rarely considered investments in horses and other implements to cut labor costs by making their time on the job more productive.

Research shows, of course, an increase in sheep rearing, manure production, and crop yields, and a corresponding decline of fallow land in the Paris basin during the eighteenth century. Tenant farmers enlarged farms, specialized in wheat, used better carts, and purchased horses to cover more land with draft teams. They used horses to accelerate carting, plowing, and grain processing, and to diminish labor costs, with the aim of gaining profit from the urban market. Farmers planted fodder crops to make money from sales in Paris, where aristocratic consumption peaked, horses became numerous, and animal feed sold well (Moriceau Reference Moriceau1994a, pp. 641–643, 659–660, 779–780; Reference Moriceau1994b, pp. 33–34, 38, 50–51, 53, 58).

Scholars, however, have gone over this research and found that the fodder crops, output increases, and threshing entailed additional workers, not labor-saving inputs. It is not clear, for instance, that parcels of land were grouped together to create large, specialized tracts amenable to efficiencies. Farmers must have purchased horses to have relays rather than additions to plow teams. They could not have used the horses to cover more acreage and hasten operations, because the advanced plows, required for such work, did not appear until after the 1850s. Tenant farmers, in view of the chronic underemployment among peasant smallholders and communities, thought less about economizing on labor than about augmenting production. One therefore must admit the conclusion—drawn from tithe records—that yields rose moderately, about 20% to 40% in the Paris basin, in line with population growth (Chevet Reference Chevet1994, pp. 118–119, 123–131, 136, 138–139, 143; Béaur Reference Béaur2000, pp. 158–159; Béaur Reference Béaur1996, pp. 371, 377, 382–383). As Joseph Goy concluded, “in the heart of the Paris Basin, demographics clearly outweigh subsistence, and incomes are so low that they lead to a decrease in marriage rates, fertility, and an increase in mortality” (Reference Goy and Béaur1998, pp. 107–108). Opportunities for profit certainly led to reductions to fallow land, increased yields, and changes to crop rotations. But if one regards the conditions of economic development in the manner of Marx and Weber—not as acquisitiveness, but as competitive pressure for labor-saving advances every investment cycle—conditions that have propelled agriculture to where it stands today, employing only 3% of the French workforce and churning out food far beyond national needs—then one recognizes the contrast with eighteenth-century France.

VI. THE PHYSIOCRATS AND LEGAL DESPOTISM

The physiocrats lived in a world of proprietors and farmers interested in remunerative prices. They naturally saw favorable prices, which might emerge from the removal of administrative controls on trade, as the keys to economic development. The Crown put the physiocrats’ theories into practice, allowing free trade in grain nationally and even internationally between 1763 and 1770, through the reforms of Comptroller General of Finance Bertin and his successor, L’Averdy, and again under the ministry of Turgot (13 September 1774). The Crown, of course, implemented the physiocrats’ program partially and reversed course in the face of penury and unrest. Indeed, one could argue that agricultural inadequacies explain why resources flowed to commerce and luxury manufactures. The recent scholarship explains the growth of these sectors by looking at migration, trade, urbanization, social mobility, print culture, and labor markets, which together propelled consumption. All strata of the urban population dramatically increased their collections of apparel. Even without gains in real wages, people may have put more family members to work, and for more hours, to expand the overall purchasing power of households (Kwass Reference Kwass2022, pp. 7, 18, 49, 73).

Quesnay and Turgot despaired of this type of growth, for they did not believe it secure without gains in agricultural productivity to control the costs of food, labor, and raw material. Productive agriculture and stable food prices enhanced the discretionary income of consumers. Yet the physiocrats’ program for promoting rural development required the far-fetched imposition of “legal despotism.” Scholars point out that, to impose trade liberalization, individual initiative, large farms, and property rights, the physiocrats turned to the inflexible framework of a monarchy grounded in feudal property relations and paternalist notions about the allocation of resources through a regulated market (Fox-Genovese Reference Fox-Genovese1976, pp. 263–265, 270, 297–298). Quesnay unrealistically proposed that the absolutist state oblige the dominant classes to forsake venal offices, seigneurial rights, and other particularistic spheres of authority and work toward extending their farms in such a way as to turn peasant smallholders into paid agricultural laborers (McNally Reference McNally1988, p. 89, 92–93, 117, 124, 145, 255).

This scholarship is no doubt correct. It is hard to imagine that the monarchy would challenge the entrenched interests of the dominant classes, the principal supporters of royal authority. Yet, as we have seen, the physiocrats could, and did, turn to the monarchy for what they believed was the wellspring of development: trade liberalization to support prices, entice investment, and augment agricultural productivity. Prices actually turned in favor of agriculture in the last half-century of the Old Regime. But this price incentive did not lead tenant farmers to invest in capital-intensive production. Rather, as Forbonnais and Diderot observed, the enticement of monetary gain led them to monopolize supplies and corner markets.

The discrepancy between Quesnay’s theories and the realities of eighteenth-century France led him to China as a deus ex machina, an idealized empire where remunerative commodity prices brought about agricultural investments. He wrote in Despotisme de la Chine ([1758] 1888, pp. 564, 573, 613, 636–637) that the constitution of the imperial dynasty, though widely regarded by contemporaries as despotic, was in fact founded on natural irrevocable laws embraced by the population. The laws accorded social status to tenant farmers and placed the tax liability on the proprietors’ share of the surplus (p. 601). China, Quesnay imagined, did not tolerate long-distance trade, expensive frivolities, harmful luxury, and the enrichment of merchants at the expense of other citizens. The government did not permit official monopolies in commerce or agriculture to interrupt the circulation of capital. Instead wealth arose out of investments in landed property and benefited the broader population. Good government, in this way, made for the immense number of inhabitants (pp. 605, 626, 635).

Quesnay and several physiocrats turned to the monarchy to impose this model of legal despotism, because they could not evade the observation that, although prices remunerated the agriculturists of their time, the recipients of this wealth spent it on luxury consumption in the towns rather than reinvesting it in the land. Quesnay and his followers therefore believed the Crown should impose the so-called natural order, conformable to reason and thus beyond logical debate, to ensure the economic goals of satisfying everyone’s needs. Legal despotism would protect liberty and property and abolish indirect taxes, seigneurial rights, and restrictions on commerce (Vardi Reference Vardi2012, pp. 170–171; Michaud Reference Michaud, Mergey, Pertué and Pollin2023, pp. 152–153).