Jonathan Israel, Dutch Primacy in World Trade, 1585-1740 (1989)

This excellent book has helped to fill in several gaps in my knowledge - about the Dutch Republic, early modern trade, European great power competition, the tools and changing nature of mercantilism. I knew of Israel as an intellectual historian of the Enlightenment, but before coming across this book, I had no idea that he had previously focused on economic and political history, a field in which he achieved great distinction. Israel challenges a number of dominant accounts of Dutch economic success in the early modern period. He disputes Fernand Braudel's claims that population and economic trends and Dutch advantages in "bulk" trades alone accounted for the Dutch Republic's economic rise and fall. Rather, politics - above all, the role of the "federal republican" Dutch state - was also crucial. Additionally, the Dutch expanded beyond the bulk trades, whose success depended on extraordinarily low shipping costs and low interest rates, to become dominant in the rich trades as well. In order to do this, they had to develop processing, refining, and manufacturing capabilities. Israel convincingly argues that the Dutch Republic's global trade primacy was predicated on something never seen before in the world: its role as an active global entrepot. Previously, Antwerp had been a global entrepot, but it had functioned more passively, as a conduit. The Dutch used both state power (elbowing Antwerp aside, forging alliances, cornering markets) and value-adding manufacturing to make themselves an active global entrepot. The book helped me understand better, though by no means fully, how mercantilism worked and evolved. The decades between 1720 and 1740 were a turning point, as a previously gentler mercantilism gave way to a "comprehensive, industrial mercantilism." Across the board, countries banned the export of raw materials and the import of finished products from other powers, with the intent to build up their own industries. Why, exactly, this change occurred now was unclear to me. Israel mentions intensified competition, but what was responsible for this? After all, competition had appeared to be quite fierce earlier - between Spain and the North Netherland; Spain and England; England and the Dutch Republic; the Dutch Republic and Denmark; the Dutch Republic and Sweden; France under Louis XIV and many countries. What was new in the early 18th century - was it a significantly strengthened England/Britain after 1688? Newly ambitious powers, like Prussia under Friedrich Wilhelm I and Russia under Peter? Greater state capacity in many places? Questions for another day.... Reading this book makes me all the more eager to read more about the Dutch and the early modern period. Stay tuned.