John Nye's provocative book suggests that some of our fundamental beliefs about economic history are inadequate or just plain wrong. His logic is that English—and then British—economic policy grew out of its wars with France between the late seventeenth and early nineteenth centuries. The high anti-French tariffs and internal excise taxes that resulted fell especially on alcoholic beverages. They were two sides of a policy that remained more protectionist than that of France well into the nineteenth century. Nye doubts that the activist government permitted by the tax revenues benefited the English economy.

Nye begins with the startling claim, first asserted in 1991 (“The Myth of Free Trade Britain and Fortress France: Tariffs and Trade in the Nineteenth Century.” This JOURNAL 51, 1 [1991]: 23–46), that from the late seventeenth century until 1860 English trade policy was more protectionist than the French, even after the abolition of the Corn Laws. Economic historians have been fooled into believing the contrary by free trade propaganda and by their failure to scrutinize carefully the measures that determine whether an economy is open or closed.

Nye analyzes two alternative measures of openness: the nominal average tariff, or “total tariff revenue as a fraction of the value of all imports” (p. 3), and imports as a fraction of national product. Neither is fully satisfactory. Nye rejects the second measure, according to which Britain was more open, because it reflects Britain's resource base and economic nature rather than the choice of trade policy. He prefers using average tariffs, which do reflect policy, and finds that “British average tariffs were substantially higher than those in France for the greater part of the nineteenth century” (p. 3). To answer the objection that with protective tariffs an economy would be closed but would not appear so by this measure, Nye tries weighting tariffs from one year with the commodity shares from different years. Once again, until after 1870, French tariff burdens remain lower.

Another, even more fundamental myth that Nye wants to dissipate is that tariffs fall neatly into two categories—protective and revenue. British tariffs began as neither. They were meant to prohibit imports from France, especially on alcoholic beverages, but did not have the purpose of protecting English home production. Rather, they formed part of a mercantilist strategy in which trade was one weapon in the conflict with France that started in the late seventeenth century and ended only in 1815.

This, then, is the heart of the matter. The rest of the book shows how English trade policy sought to damage its rival by curtailing exports of wine and spirits. It then follows the unexpected consequences of that policy.

Prohibitions and high tariffs reduced British purchases of French wine, from over 70 percent of total wine imports in 1686–1689 to around 3 percent from the 1720s to the 1780s. Since tariffs were assessed by volume and were higher on French than on Portuguese wine, imports from France fell while those from Portugal increased. The French sought to meet the challenge by producing high quality wine that could afford the tariff—like bottled Bordeaux—and those Britons who could not afford expensive wine drank domestic beer and gin. The English taste for these last two beverages was thus not a genetic predisposition but arose from the absence of French wines “at the very moment in history when mass consumer tastes were formed” (p. 40). Nye seeks to demonstrate that without tariffs, British imports in earlier years would have been many times higher. They did in fact rise 600 percent after 1860 when the Cobden-Chevalier Treaty lowered duties considerably.

After wine and tariffs, beer and taxes. Nye draws his evidence on these topics from the work of John Brewer (The Sinews of Power. Cambridge, MA: Harvard University Press, 1988), Patrick O'Brien (“The Political Economy of British Taxation.” Economic History Review 41, no. 1 [1988]: 1–32), and Peter Mathias (The Brewing Industry in England, 1700–1830. Cambridge: Cambridge University Press, 1959). They have shown that British tax collections rose considerably in the eighteenth century with an increasing share coming from excise taxes. Those levied on alcoholic beverages, especially beer, formed a large share. Beer production itself was revolutionized, as a few very large brewers of porter came to dominate the industry. Since these brewers relied on high tariffs on French wine, they had no choice but to accept high excise taxes. The conclusion follows—Nye's contribution is to fit all the pieces together—that the strength of the British government and its international power stemmed from tariffs. This is a brilliant tour de force of dot connection. As a historian I only wish Nye had found some evidence that either the brewers or the government realized that this was how they were behaving.

Nye continues his discussion of British trade policy into the nineteenth century. Once again, he finds a commonly held belief—that Britain used its hegemonic economic power to impose a free trade regime—inaccurate. In the first place, as he reiterates, Britain did not have a free trade system until 1860, and it was the French who sought it then. When, at the end of the century, the British did adopt free trade, other countries like France and Germany were rejecting it. The idea of the hegemon controlling the world economy for everybody's benefit collapses.

Nye critiques the idea that high taxes and the active mercantilist foreign policy that they permitted were beneficial to Britain. While he hasn't done it himself, he suggests that the only way to determine whether they were helpful or harmful is to measure the various impacts, just as he has measured the incidence of tariffs.

The book, part of Princeton's series The Economic History of the Western World, edited by Joel Mokyr, is up to the usual high standards of the press. Nye writes with force and clarity, though chapters seem sometimes to be separate papers circling around a theme rather than carrying it forward. This flaw detracts little from a splendid work that all economic historians will want to read.