Hostname: page-component-586b7cd67f-tf8b9 Total loading time: 0 Render date: 2024-11-25T00:25:06.690Z Has data issue: false hasContentIssue false
  • English
  • Français

Attitudes to Credit in Britain, 1680–1790*

Published online by Cambridge University Press:  11 February 2009

Julian Hoppit
Julian Hoppit
Affiliation:
University College London
Get access Rights & Permissions [Opens in a new window]

Extract

The history of economic ideas in Britain is dominated by a great tradition which in its early stages focuses on Adam Smith. For the century before the publication of the Wealth of nations in 1776, economic ideas are most often studied in relation to the ‘arrival’ of Smith and commented on with regard to the degree to which they may be considered precursors of his ideas. Though this imposes a sense of order and establishes some principles with which to select from the vast range of economic writings, the dangers of certain whiggishness in this approach are readily apparent. Writers can appear to be winners or losers depending on the extent to which their ideas were denied, adapted or adopted by Smith and the other classical economists.1 Such problems have been acknowledged by many historians, not least by those who have fruitfully examined the political and philosophical bases of the emergence of political economy, particularly with regard to the Scottish enlightenment. Despite this, the force of the great tradition remains very strong. The authors and ideas that are examined are the ‘major’ ones, that is to say contributions that were, or attempted to be, either comprehensive or clearly attached to what, with hindsight, were the main strands of development. The emphasis has been upon theories or systematic explanations of the economic order. Not surprisingly the unsystematic and more casually formulated reflections of non-economists and ‘amateurs’, such as Defoe, are often swept under the carpet, even if their ideas on economic matters were more widely disseminated (and perhaps more influential) at the time. Consequently, our perception of economic ideas between the Restoration and the Wealth of nations continues to be highly and perhaps atypically selective.

Type
Articles
Information
The Historical Journal , Volume 33 , Issue 2 , June 1990 , pp. 305 - 322
Copyright
Copyright © Cambridge University Press 1990

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Vickers, Douglas, for example, in his valuable book, Studies in the theory of money 1690–1776 (1959), p. 7Google Scholar, wrote that ‘It is not our purpose to present an exhaustive treatment of the theory of money between 1690 and 1776. We shall endeavour to establish, on the other hand, new and historically more meaningful categories of thought and to exhibit the mainstream of development. A selection had been made of the more important authors, either for their influence on contemporary thought or for the inherent worth and scientific importance of their contributions.’

2 See, for example Winch, D., Adam Smith's politics (Cambridge, 1978)CrossRefGoogle Scholar; Hont, I. and Ignatieff, M. (eds.), Wealth and virtue: the shaping of political economy in the Scottish enlightenment (Cambridge, 1983)CrossRefGoogle Scholar.

3 This was the guiding principle in Letwin's, W. investigation, The origins of scientific economics: English economic thought 1660–1776 (1963)Google Scholar.

4 There was also a ‘problem of debt’ which will not be discussed in this article. See Hoppit, J., Risk and failure in English business 1700–1800 (Cambridge, 1987), chs. II, III, XCrossRefGoogle Scholar; Innes, J., ‘The Kings Bench prison in the later eighteenth century’, in Brewer, J. and Styles, J. (eds.), An ungovernable people (1980), pp. 250–98Google Scholar; Haagen, P. H., ‘Eighteenth-century English society and the debt law’, in Cohen, S. and Scull, A. (eds.), Social control and the state (Oxford, 1983), pp. 222–47Google Scholar; Lineham, P. J., ‘The campaign to abolish imprisonment for debt in England 1750–1840’ (unpublished M.A. dissertation, University of Canterbury, New Zealand, 1974)Google Scholar; Brown, R. L., ‘The minters of Wapping: the history of a debtors' sanctuary in eighteenth-century east London’, East London Papers, XIV, 2 (1972), 77–86Google Scholar.

5 Dickson, P.G.M., The financial revolution in England (1967)Google Scholar.

6 Scott, W. R., The constitution and finance of English, Scottish and Irish joint-stock companies to 1720 (3 vols., Cambridge, 1910–12)Google Scholar.

7 Mathias, P., ‘Capital, credit and enterprise in the industrial revolution’, in Mathias, P., The transformation of England (1979), 85–101Google Scholar; Presnell, L. S., Country banking in the industrial revolution (Oxford, 1956)Google Scholar.

8 Pocock, J. G. A., The Machiavellian moment (Princeton, 1975)Google Scholar, chs. XIII, XIV; idem, Virtue, commerce, and history (Cambridge, 1985).

9 Typologies of such crises are discussed in Hoppit, J., ‘Financial crises in eighteenth-century England’, Economic History Review, XXXIX, 1 (1986), 39–58CrossRefGoogle Scholar.

10 Kennedy, W. P., English taxation 1640–1799 (1913), pp. 45–6Google Scholar; Davis, R., ‘The rise of protection in England 1689–1786’, Economic History Review, XIX, 3 (1966), 306–17Google Scholar; Dickson, Financial revolution; Jones, D. W., War and economy in the age of William III and Marlborough (Oxford, 1988)Google Scholar; Brewer, J., The sinews of power: war, money and the English state, 1688–1783 (1989)Google Scholar.

11 ‘The 1690s patent boom: invention or stock-jobbing’, Economic History Review, XXXIX, 4 (1986), 549, 560Google Scholar.

12 Coleman, D. C., The economy of England 1450–1750 (Oxford, 1977), p. 170Google Scholar; Scott, , Joint-stock companies, 1, 327Google Scholar, 347–50; Davies, K. G., ‘Joint-stock investment in the later seventeenth century’, Economic History Review, IV, 3 (1951–2), 292Google Scholar; Horsefield, J. K., British monetary experiments 1650–1710 (1960), chs. 1, 2, 4–6Google Scholar; Jones, D. W., ‘London merchants and the crisis of the 1690s’, in Clark, P. and Slack, P. (eds.), Crisis and order in English towns 1500–1700 (1972), pp. 316–19Google Scholar; Hoskins, W. G., ‘Harvest fluctuations and English economic history, 1620–1759’, Agricultural History Review, XVI, 1 (1968), 16Google Scholar.

13 Dickson, , Financial revolution, p. 516Google Scholar.

14 Commons Journals, XI, 595. See also Horwitz, H. (ed.), The parliamentary diary of Narcissus Luttrell 1691–1693 (Oxford, 1972), p. 147Google Scholar for an attack on stockjobbers in 1692.

15 Angliae Tutamen: or the safety of England (1695), PP. 3–4.

16 In 1731–2 there was not a financial crisis but the discovery of a massive fraud of the Charitable Corporation. This corporation had gained a charter in 1707 to raise share capital to lend on pledges to the industrious poor. Its failure stymied future attempts to set up some government-backed alternative to the pawnbrokers. See Cummings, A. J. G., ‘The York Buildings Company. A case study in eighteenth century corporation mismanagement’ (unpublished Ph.D dissertation, University of Strathclyde, 1980), ch. 6Google Scholar; Lambert, S. (ed.), House of Commons Sessional Papers of the Eighteenth Century, 145 vols. (Wilmington, Delaware, 1975), XIVGoogle Scholar; Bulloch, J. M., ‘The Charitable Corporation’, Notes and Queries (01–06 1931), pp. 237–41Google Scholar.

17 These criticisms have been well covered in Dickson, Financial revolution, ch. 2; Pocock, The Machiavellian moment, chs. XIII, XIV; idem, Virtue, commerce and history; Kramnick, I., Bolingbroke and his circle: the politics of nostalgia in the age of Walpole (Cambridge, Ma, 1968)Google Scholar; Robbins, C., The eighteenth century commonwealthman (Cambridge, Ma, 1959)CrossRefGoogle Scholar; Dickinson, H. T., Liberty and property: political ideology in eighteenth-century Britain (1977)Google Scholar; Brooks, C., ‘Taxation, finance and public opinion, 1688–1714’ (unpublished Ph.D. dissertation, University of Cambridge, 1970)Google Scholar.

18 Swift, J., The Examiner, ed. Davis, H. (Oxford, 1957), p. 5Google Scholar, 2 Nov. 1710; Ashton, T. S., Economic fluctuations in England 1700–1800 (Oxford, 1959), pp. 116–17Google Scholar.

19 In Pope's words, ‘Blest paper-credit! last and best supply!/That lends Corruption lighter wings to fly!’ Pope, A., ‘Epistle to Lord Bathurst’ (1733), in Butt, J. (ed.), The Twickenham edition of the poems of Alexander Pope, 11 vols. (1940–69)Google Scholar, III, pt. 2, 90.

20 For example, An appeal to the people of England, the publick companies and monied interest, on the renewal of the charter of the Bank (1742), p. 13.

21 Reasons for the more speedy lessening the national debt, and taking off the most burthensome of the taxes (1737); Berkeley, G., An essays towards preventing the ruin of Great Britain (1721) in Jessop, T. E. (ed.), The works of George Berkeley, Bishop of Cloyne, 9 vols. (1953), VI, 76Google Scholar, offers a similar equation, this time in the aftermath of the South Sea Bubble.

22 Sekora, J., Luxury: the concept in western thought, Eden to Smollett (Baltimore, 1977)Google Scholar; Wade, S. M., ‘The idea of luxury in eighteenth-century England’ (unpublished Ph.D. dissertation, Harvard University, 1968)Google Scholar.

23 Defoe, D., The villainy of stock-jobbers detected (1701), p. 26Google Scholar.

24 Hammond, A., A modest apology, occasioned by the late unhappy turn of affairs, with relation to publick credit (1721), p. 28Google Scholar.

25 The national debt was described by Lord Elibank as ‘a gangrene in the commonwealth, and will submit to nothing but amputation… The public debt has opened the iniquitous traffic of stockjobbing, and introduced a spirit of gaming amongst all degrees of men.’ Murray, P., An inquiry into the original and consequences of the publick debt (1754)Google Scholar.

26 [Pulteney, W.] A proper answer to a by-stander (1742), pp. 29–30Google Scholar.

27 Hume, D., Essays, moral, political and literary (1903), pp. 356, 369Google Scholar.

28 Smith, A., An inquiry into the nature and causes of the wealth of nations, ed. Cannan, E. (Chicago, 1976), II, 465–6Google Scholar. See also for this period Price, R., An appeal to the public on the subject of the national debt (1772)Google Scholar. Adam Smith had helped Townsend in 1766–7 with a study of the sinking fund and the state of the national debt. See Scott, W. R., ‘Adam Smith at Downing Street, 1766–7’, Economic History Review, VI, I (1935–6), 79–89Google Scholar. Price played an important part in discussions over the national debt in the 1770s and 1780s. See Thomas, D. O., The honest mind: the thought and work of Richard Price (Oxford, 1977)Google Scholar, ch. XII.

29 On the different character of these crises see Hoppit, , ‘Financial crises’, pp. 55–6.Google Scholar

30 There were also, of course, mortgages an d bonds, but these mostly avoided comment, probably because of the quality of the security attached to the loans and because they were connected to the virtuous pursuit of estate improvement.

31 Defoe, D., The complete English tradesman (1726), p. 225Google Scholar. He thought (p. 416), that two-thirds of English trade was conducted by credit.

32 Horace Walpole loved detailing the huge debts of some of the elite. He notes how the young Lord Foley and his brother had run up debts of £220,000 and Charles James Fox £100,000. The Tale edition of the correspondence of Horace Walpole, 48 vols. (1937–1983); XXVIN, 392Google Scholar; XXM, 498–9.

33 ‘English popular literature and the image of business, 1760–1790’ (unpublished Ph.D. dissertation, University of Cambridge, 1985)Google Scholar, See also Lawson, P. and Phillips, J., ‘“Our execrable banditti”: perceptions of nabobs in mid-eighteenth century Britain’, Albion, XVI, 3 (1984), 225–41CrossRefGoogle Scholar.

34 Moore, C., A full inquiry into the subject of suicide, 2 vols. (1790), II, 358Google Scholar. See also Hey, R., A dissertation on the pernicious effects of gambling (Cambridge, 1783)Google Scholar.

35 The correspondence of Edmund Burke, ed. Copeland, T. W., 10 vols. (1958–78), VII, 594–5Google Scholar.

36 Defoe had ‘nothing of Merit to plead for…this Evil’; ‘I lay it down as a state Rule, that to this one Article of Retail-Credit, we owe almost all the Deficiencies of Trade, Bankrupt Tradesmen, loss of Honour, and ill Compliance with Bills and Payments.’ D. Defoe, Defoe's review, reprinted in 22 vols. (New York, 1938), VI, 26, 15 Jan. 1706; VI, 33, 18 Jan. 1706. In 1788 Lord Rawdon complained about ‘that unbounded credit which was too promiscuously given…tradesmen gave credit to those who had no right to expect it’. Cobbett, W. (ed.), The parliamentary history of England, 36 vols. (1806–1820), XXVN, 549Google Scholar.

37 This is discussed briefly in Hoppit, J., ‘The use and abuse of credit in eighteenth-century England’, in Outhwaite, R. B. and McKendrick, N. (eds.), Business life and public policy: essays in honour of D. C. Coleman (Cambridge, 1986), pp. 74–6Google Scholar.

38 Patrick Colquhoun urged Pitt the Younger to tax pawnbrokers, putting their number at 3,000. ‘A plan for raising a revenue on the dealing of pawnbrokers in proportion to their profits’, London, Public Record Office (P.R.O.), 30/8/272, fo. 288. See also M. Margaret, ‘Plan for a tax on pawnbrokers’, P.R.O., 30/8/274, fo. 171.

39 Pollins, H., Economic history of the Jews in England (1982), p. 42Google Scholar.

40 Pawnbrokers detected and dissected: or the poor man's advisor (1809), p. 4.

41 [Winstanley, W.]. Four for a penny: or, poor Robin's character of an unconscionable pawn-broker (1678)Google Scholar.

42 30 George II, c. 2; Colquhoun, ‘A plan for raising a revenue’, fo. 287; The Times, 11 July 1788, p.2.

43 Generally, Israel, J., European Jewry in the age of mercantilism 1550–1750 (Oxford, 1985), ch. 1CrossRefGoogle Scholar; Endelman, T., The Jews of Georgian England 1714–1830 (Philadelphia, 1979), pp. 30, 99–104Google Scholar.

44 Walpole's correspondence, XXIV, 231, 11 08. 1776Google Scholar; see also p. 235 for another outburst of antisemitism. For a mor e measured an d friendly reaction, Horace Walpole's memoirs, ed. Brooke, J. (3 vols., New Haven, 1985), 1, 238–9Google Scholar.

45 Two articles by A. Ruben s reprints some of these portrayals: ‘Portrait of Anglo-Jewry 1656–1836’, Transactions of the Jewish Historical Society, XIX (1955–9), 13–52 and ‘Anglo-Jewry in caricature 1780–1850’, Transactions ofthe Jewish Historical Society, XXIII (1969–70), 96–101. By way of example see ‘F – boring money out of a Jew’ (1784) and ‘Moneylenders’ (1784) in F. G. Shepherd and M. D. George (eds.), Catalogue of political and personal satires, 11 vols. (1870–1954), VI, 148, 199.

46 Shepherd, and George, , Catalogue, VII, 25Google Scholar. On the same theme see ‘The political pawn brokers’ (1793), by Cruickshank, in Shepherd, and George, , Catalogue, VII, 25Google Scholar.

47 See Hoppit, , ‘Financial crises’ and Risk and failure in English business, pp. 130–9Google Scholar.

48 22 May 1788, p. 2. For contemporary reactions to financial crises and trade credit see Hoppit, Risk and failure, ch. VIII.

49 The management and (economy of trade or the young trader's guide (1783), p. 20.

50 For a vivid portrayal of such arguments see Jenner, C., Town ecologues (2nd edn, 1772)Google Scholar.

51 Full inquiry, 11, 352–3. These issues are nicely detailed in the London Chronicle, 28–30 Apr. 1772, p. 412, an d 19–22 Sept. 1772, p. 285.

52 Goldsmith, O., ‘Of the pride and luxury of the middling class of people’, in Friedman, A. F. (ed.), The collected works of Oliver Goldsmith (5 vols., Oxford, 1966), 1, 486Google Scholar. Closely related to this see Fielding, H., An enquiry into the causes of the late increase of robbers in The collected works of Henry Fielding (16 vols., New York, 1967), XIII, 14, 21–3Google Scholar; Brown, J., An estimate of the manners and principles of the times (Dublin, 1757)Google Scholar.

53 Clerical hostility to trade credit ca n be found in: Calaray, E., A sermon at the merchants lecture in Sailers Hall on Decemb. the 7th. 1708. Upon occasion of the many late bankrupts (1709)Google Scholar; Fleetwood, W. [Bishop of Ely], The justice of paying debts. A sermon preach'd in the City (1718)Google Scholar; Bradford, S. [Bishop of Carlisle], The honest and dishonest ways of getting wealth (1720)Google Scholar; Scott, W., A sermon on bankruptcy, stopping payment, and the justice of paying our debts, preached at various churches in the City (1773)Google Scholar; Moore, , Full inquiry, II, 352–61Google Scholar; Gisborne, T., An enquiry into the duties of men in the higher and middle classes of society in Great Britain (1794), ch. XIIIGoogle Scholar; Wade, ‘The idea of luxury’, ch. VII.

54 Husbandry and trade improv'd, ed. Bradley, R. (4 vols., 1727–8), I, 259Google Scholar, 261, 274; II, 7, 43–4.

55 This despite the fact that, as Sir John Sinclair noted, many distinguished names – Davenant, Decker, Postlethwayt and Pulteney – made these points. The history of the public revenue of the British empire (Dublin, 1785), p. 293Google Scholar.

56 Some considerations on publick credit (1733), p. 5. This is a good defence of th e national debt.

57 Davenant, C., An essay upon ways and means (1695)Google Scholar in Whitworth, C. (ed.), The political and commercial works of Charles D'Avenant (5 vols., 1771), 1, 23Google Scholar.

58 A serious address to the proprietors of the public funds (1744), p. 25; Remarks on the present state of the national debt (1764), p. 21. This could be dressed up in the language of warm and worthy emotions: ‘Whatever sum of money is owing by one member of a family to another of the same family, cannot in any degree add to, or take from, the quantity of property possessed by the whole family. The same remark may be applied to the nation.’ Scots Magazine, L (1788), 9Google Scholar; this quote is an excerpt from a pamphlet entitled The public debt productive of national prosperity. See also Gale, S., An essay on the nature and principles of public credit (1784) andGoogle ScholarSinclair, , History of public revenue, p. 315Google Scholar.

59 Considerations on the present state of the nation, as to publick credit, stocks, the landed and trading interests (1720), pp. 10–11. In Hume's words, ‘the public is a debtor, whom no man can oblige to pay’. Essays, p. 370.

60 Gale, , An essay, p. 186Google Scholar. This replicated th e opinion of Barnard, John Sir, Reasons for the more speedy lessening the national debt, and taking off the most burthensome of the taxes (1737), p. 11Google Scholar.

61 Dickson, , Financial revolution, pp. 47, 470Google Scholar.

62 Essays, pp. 303, 312.

63 An apology for the business of pawnbroking (1744), pp. 6, 15, 72. For other defences see Commons Journals, XXIV, 732–3; Campbell, R., The London tradesman (Newton Abbot, 1969 edn), pp. 296–7, 337Google Scholar.

64 An essay on the coyn and credit of England: as they stand with respect to trade (Bristol, 1696), p. 1Google Scholar.

65 The case of the Charitable Corporation (1730?), p. 1.

66 Bastian, F., Defoe's early life (1978)Google Scholar, ch. 9.

67 Defoe, D., The villainy ofstock-jobbers detected (1710)Google Scholar; The manufacturer, 9 June 1720 and 10 Aug. 1720; Defoe's review, VI, 73–5, 12 Feb. 1706 and 77–9, 14 Feb. 1706; Essay upon projects (1697), pp. 191–227.

68 Defoe's review, XVII, 221, 5 Aug. 1710; for the same sentiment see also VI, 8, 3 Jan. 1706; An essay upon publick credit (1710).

69 The Spectator, ed. by Bond, D. F. (5 vols., Oxford, 1965), IV, 309Google Scholar.

70 Sykes, A. A., A letter to a friend. In which is shewn, the inviolable nature of publick securities (1717), p. 5Google Scholar.

71 26 July 1723.

72 An enquiry into the principles of political economy, edited by Skinner, A. S. (2 vols., Edinburgh, 1966), II, 440Google Scholar.

73 The Examiner, p. 134, 19 Apr. 1711; Swift undoubtedly ha d Defoe in mind here, see Backscheider, P. R., ‘Defoe's lady credit’, Huntington Library Quarterly, XLIV, 2 (1981), pp. 89–100CrossRefGoogle Scholar; Lock, F. P., Swift's tory politics (1983), pp. 110–15Google Scholar; Pocock, , Machiavellian moment, pp. 452–6Google Scholar.

74 Eilon, D., ‘Private spirit: a moral and political theme in Swift's prose’ (unpublished Ph.D. dissertation, University of Cambridge, 1986), pp. 65–72Google Scholar.

75 Essays, p. 259.

76 Roover, R. de, ‘Scholastic economies’, in New Catholic Encyclopedia, 15 vols. (New York, 1967), V, 65Google Scholar.

77 See Roover, R. de, ‘Scholastic economics: survival and lasting influence from the sixteenth century to Adam Smith’, in Kirshner, J. (ed.), Business, banking and economic thought in late medieval and early modern Europe (Chicago, 1974), pp. 311–12Google Scholar; Viner, J., Religious thought and economic society, ed. Melitz, J. and Winch, D. (Durham, North Carolina, 1978), pp. 50–61Google Scholar.

78 Robertson, H. M., Aspects of the rise of economic individualism: a criticism of Max Weber and his school (Cambridge, 1933)Google Scholar.

79 Schama, S., The embarrassment of riches: an interpretation of Dutch culture in the golden age (1987)Google Scholar, especially ch. 5, ii.

80 Hilton, B., The age of atonement (Oxford, 1988)Google Scholar.