From Harvard Business School's Working Knowledge, August 11:
In the book Capital Untamed, Charlotte Robertson examines how France used financial markets to pursue political, economic, and social goals. This excerpt sheds light on the enduring relationship between governments and financial markets.
This is an excerpt from the book Capital Untamed: The Politics of Finance in Nineteenth-Century France by Charlotte Robertson. The University of Chicago Press, June 2026.
The stories told about the relationship between the state and financial markets in the modern era have traditionally revolved around determinations of more or less state regulation, more or less market freedom, and how these elements have been reconfigured across historical regimes of political economy.
The received wisdom is that the nineteenth century marked the period of classical liberalism in Europe, before the crises of the 1930s drove states governing advanced economies to assume more interventionist postures in the organization of investment and financial markets. The post–World War II consensus in Europe and the United States held that if markets were tightly bound by regulation, they could be made to serve the needs of the real economy.
This model of “embedded liberalism,” which entailed state control over finance, was understood as a necessary condition for ensuring stability by encouraging investment into productive capital formation and preventing speculative excesses. The neoliberal consensus that emerged in the 1980s assumed the opposite: that if markets were unbound, they would stimulate growth and wealth creation.
The premise was that financial deregulation would enhance efficiency, unlocking private capital for productive investment while reducing distortions introduced by state intervention. Beyond the ideal types of contained or unbridled finance, scholars have drawn attention to the qualitative complexity of efforts by states in the twentieth century to do more—to steer capital toward a variety of social, political, and economic goals through planning, industrial policy, credit policy, and other instruments.
This book does not aim to redefine capitalism, propose a new theory of capital, or periodize a distinct capitalist era, all of which are important and ongoing projects in a rich and expanding literature on the history of capitalism. Instead, it explores how a particular dynamic between political authority and financial markets shaped nineteenth-century France—foreshadowing a form of state-finance entanglement that would become increasingly typical of modern capitalism.
The analysis does not proceed from an explicit application of deductive theory but from a close reading of historical archives. From this reading, I have arrived at two concepts—instrumental and autonomous finance—to describe the twin poles of this dynamic, concepts that I believe are heuristically useful for identifying the evolution of power relations between the modern state and the financial markets, which both enable and constrain state action.
Postrevolutionary France offers a productive starting point for this line of inquiry because of the striking proliferation of ideas and projects to instrumentalize finance that emerged there and then. In France by the 1830s, financial thought was not confined to the realm of profit-making economic activity; it also functioned as a mode of political thought.
A variety of historical actors—from theorists and politicians to laborers, bankers, and radical reformers—embraced financial vehicles, instruments, plans and programs because they appeared uniquely placed to offer pragmatic solutions to the impasses of their times. On the one hand, its appeal derived from the political instability of the era; finance presented the prospect of salutary revolutionary change without revolutionary upheaval. On the other hand, this consciousness stemmed from the much larger capital demands and expansion of market-based financing that arose alongside early industrialization....
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Also at HBS Working Knowledge: "When Companies Treat Corruption as a 'Source of Competitive Advantage'"
And all this time my dream has been to turn compliance into a profit center.
Must. Think. Bigger.
Possibly related on the economy of France, the outro from "The Shortest History Of France":
***
....Shortest history? Hardly (insert ill-founded Pepin joke here).
At least for mid/late 18th century French economic history it can be summarized as:
Pericles Press: France - The Economic History
—Chronology of Economic Events
1768
Riots over prices in Le Havre and Nantes. 1770
Riots in Rheims. 1774
Government efforts to deal with shortages lead to popular rumors of a 'famine pact' among the nobility to starve the people.
May 10 - Louis XVI ascends to throne of France. 1775
Poor harvest in the fall.
April 27-May - "Flour War" 1776
Bread prices in Paris increase by over 50%..
Rioting starts at Beaumont-sur-Oise, spreads to Paris..
Hundreds arrested, two executed, before order is restored.
June 11 - Coronation of Louis XVI.
October 22 - Necker appointed Director of the Treasury. 1777
Necker begins financing money for American War of Independence through governmental loans, rather than taxes. System will raise 520 million livres by May 1781. 1781
May 19 - Necker resigns. 1788
Successor Joly de Fleury implements tax increases. By December 1782 will raise 252 million livres.
June - Government tries to implement overhaul of judicial system.
June 7 - Day of Tiles (Grenoble); Mob bombards troops with tiles.; 4 people killed in rioting, 40 injured.
July 13 - Severe hailstorm destroys crops in northern France.
August 8 - Announcement of convocation of Estates General.
Will formally meet on May 1, 1789.
August 16 - Government suspends treasury payments on loans due to lack of funds, causing panic in French stock market, as well as a bank run.
August 24 - Necker reappointed.
Reimposes price controls, in anticipation of shortages from poor harvest.
September - Restoration of Parlements.
Oct 5 - Dec 12 - Second Assembly of Notables meets.
Oct 24 - 26 - Necker reappointed Minister of Finance.
1789January 24 - Summoning of the Estates General.
January 26-29 - Crowd demanding lower bread prices is attacked by bands of students. Several killed in the fighting.
Winter-spring - Shortages lead to higher prices and rising unemployment.
April 27-28 - Reveillon riots. Acting on rumors of wage cuts, rioters destroy factory of wallpaper manufacturer; 25 killed when troops open fire.
May 5 - Estates General convene.
May - Bread riots occur throughout Flanders, Artois, Picardy, and Normandy.
June 17 - National Assembly proclaimed.
June 20 - Tennis Court Oath.
June 28-30 - Rioters protesting high prices destroy city's toll-gates.
Early July - Troops assigned to protect convoys of grain and flour.
July 11 - Necker dismissed.
July 14 - Rising grain prices and food shortages finally peak.
Fall of the Bastille.
July 22 - Foulon and Bertier, rumored to have been part of a plot to starve Paris, are murdered and decapitated by a mob.
July 20 - 31 - "Great Fear" - Fear that nobility intends to use force to reverse gains causes panic among peasantry throughout France.
Castles and abbeys sacked.
August 26 - Declaration of Rights of Man and the Citizen.
August - Government attempt to float two loans fails.
September - Grain prices increase. Grain riots occur around Paris and groups of women stop grain convoys. Guards placed around bakers' shops.
October 5-6 - Fueled by rumors of another starvation plot, crowd marches to Versailles. Lafayette escorts king back to Paris, followed by a procession of 60,000.
October 21 - Martial Law against Tumults passed. Allows local authorities to declare martial law to deal with disturbances.
1790January - 22 chateaus destroyed by peasants in northern Brittany.
June 13-17 - Fighting between Catholics and Protestants leaves 300 dead in Nimes.
August 31 - Mutiny by troops at Nancy put down. 23 mutineers executed.
September 3 - Necker resigns.
1791February - Emigration of nobility and closure of church organizations leads to rising unemployment.
March 2 - Trade guilds abolished by National Assembly.
June 14 - Le Chapelier Law bans worker organizations and collective actions, effectively preventing strikes and collective bargaining.
June 20 - Louis XVI tries to flee. Stopped at Varennes.
July 17 - Champ de Mars massacre - 50 people killed when National Guard troops open fire on crowd of 50,000.
September - December - Paris authorities increase grain reserves in anticipation of shortages. Leads to depletion of stocks in outlying regions.
September 14 - Louis XVI accepts constitution.
September 30 - National Assembly dissolved.
October 1 - Legislative Assembly meets for first time.
1792January - Slave rebellion in West Indies causes sugar shortage in Paris. Sugar prices triple.
January-February - Grain riots in northeastern France due to depleted stocks.
February - Mayor of Etampes lynched for failing to lower grain price reduction.
Dunkirk's warehouses destroyed in three days of rioting provoked by attempts to export grain.
April 20 - France declares war on Austria.
August 10 - Tuileries stormed and monarchy overthrown.
September 2 - 6 - September Massacres. An estimated 1,200 to 1,400 prisoners murdered by mobs and tribunals.
September 21 - National Convention meets.
September 22 - Republic proclaimed.
December - Trial of Louis XVI.
1793January 21 - Execution of Louis XVI.
February - Sugar and coffee price increases lead to petitions for the passage of a maximum price law.
February 26 - Grocery riots in Paris. Grocery shops and warehouses attacked and sales forced at fixed prices.
March 10 - Revolutionary Tribunal created.
April 6 - Committee of Public Safety created.
May 1 - 8,000 demonstrators mob Convention demanding the introduction of price controls on bread. Girondins resist maximum.
May 20 - Forced loan on the rich.
May 24 - Crowds in Lyons invade warehouse and sell army provisions.
May 31 - Anti-Girondin uprising in Paris.
June 2 - Crowd of around 80,000 surrounds Convention and forces it to purge Girondins. (21 would be executed in October.)
June 24 - Constitution of 1793 accepted.
June 25 - Crowds of women attack soap suppliers and force sales.
July 26 - Death penalty for hoarding law passed.
September 4 - Workers in Paris march on the Convention, demanding end to shortages.
September 5 - "Reign of Terror" begins when Convention votes to implement terror.
September 23 - Forced loan on the rich.
September 29 - General Maximum Law imposes price controls on goods.
October 16 - Marie Antoinette beheaded.
Oct. 24-30 - Trial of Girondins.
October 31 - Execution of Girondins.
1794February 21 - Nationwide schedule of maximum prices promulgated.
March - Hebertists arrested and executed.
April 5 - Danton and Desmoulins executed.
April - Le Chapelier law against price increases used to punish ringleaders of tobacco workers who had asked for a wage increase.
July 5 - Wage controls introduced in Paris.
July 27-28 - Robespierre loses support among Parisian laborers following implementation of wage controls, is ousted from power and guillotined.
August 1 - Law of 22 Prairial repealed. Terror begins to collapse with governmental reorganization.
August 9 - Wage controls abandoned.
August 11 - Committee of Public Safety deprived of major role in government.
September 7 - Maximum Law extended by Convention for another year.
December 24 - Maximum abolished.
Frozen rivers disrupt transport system for winter.
1795January-February - Winter shortages lead to bread rationing and government- subsidized purchases by spring.
March 22 - Women petition Convention for better bread supplies.
March 24 - Convention orders requisition of two-thirds of available grain supplies from suppliers.
March 27-28 - Bread riots in sections of Paris.
April 1-2 - Uprising of Germinal. Crowd (10,000) marches on Convention.
April 10 - Convention authorizes disarming of "terrorists."
May 4 - Former terrorists massacred by mob in Lyons.
May 20-23 - Uprising of Prairial. Mob invades Convention hall. Slogan "Bread and the Constitution of 1793" is heard. Deputy Feraud killed.
Convention restores order and executes mob leaders in retaliation.
May 31 - Revolutionary Tribunal abolished.
Summer - Paris endures shortages of basic commodities and inflation.
July 21 - Royalist invasion at Quiberon repulsed.
November 2 - Directory constituted.
December 10 - Forced loan.
1796February - Bread and meat rations reduced as supplies dwindle.
March 2 - Napoleon Bonaparte appointed commander in Italy.
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