Author's response
I am extremely grateful to Dr. S. D. Smith for an extensive, thoughtful and, mainly, positive review. I also appreciate his final conclusion that, despite his criticisms, the 'chronological range of Customs and Excise is so impressive . that it is hardly reasonable to demand more'.
Smith's central concern, as I read it, is the lack of 'verifiable propositions' that I present 'linking administrative evolution with economic development'. In my book I have argued that industrial policy during the eighteenth century was far less ambiguous than has traditionally been thought. Protecting industry, especially infant sectors, through high tariff duties was far more planned than is usually presented. It may not have been a fully blown industrial policy systematically applied, but it did represent a recognised, actively pursued and ultimately successful strategy. The protective barriers allowed manufacturers to develop, which enabled the excise to expand and farm industry. This made revenue collection more efficient and, crucially, relatively predictable (compared to customs). In turn, this allowed more of the population to be employed and therefore alleviate the threat of domestic social unrest and drain on the nation's bullion. All of which made the country more self-sufficient at a time when it was so often at war. Although I do not engage specifically with recent arguments stressing a policy of import substitution, I believe my work compliments, rather than contrasts, this focus.(1)
The excise, especially, was instrumental in defining the method, materials and architecture of production. To tax a good frequently required it to be rendered visible, both in terms of its ingredients and in the way it was produced. This ultimately required an attempt to regulate its qualities and for the site of production to be reconfigured to meet the excise's process of measurement (I devote part 5 of the book to this theme).
Protectionist policies nurtured England's predominantly backward domestic manufactures, raising its quality to match continental rivals (often illegally imported), and vitally providing the revenue necessary to underpin Public Credit. In this sense state regulation was vital in speeding up both domestic and global markets, capital, and industrial development. This process, I argue, reached its peak by the late 1770s. Then the structure quickly started to crumble under the weight of the fiscal-military state, and under William Pitt's calculated policy of concentrating industrial policy around the lightly- or untaxed industries of cotton, wool, potteries and iron, at the expense of other highly taxed manufactures. For traditional industries state regulation had now become a hindrance to innovation.
I now return to the subject of Smith's central concern over 'verifiable propositions'. My weakness, he claims, is the lack of data demonstrating the incidence of taxation on excised goods, although he does go on to admit 'it is unlikely that adequate information exists to permit such a calculation for this or any other taxable commodity'. He then proceeds to suggest I should have drawn upon recent studies assessing the impact of indirect taxation on developing economies, which focus on 'household budgets before and after changes to the tax regime'. This is a point he reiterates at greater length towards the end of the review. Comparing my approach to Joseph Inikori's recent book, Africans and the Industrial Revolution, he writes: 'One virtue of Inikori's book is his willingness to draw relevant comparisons between eighteenth-century Britain and the post-war developing world. Ashworth could likewise have supplemented his enquiry with some modern comparisons of states financed by similar fiscal regimes'. In addition, this absence, he implies, allows me to make 'subconscious value judgements' that makes me too sympathetic to participants in 'the 'informal/illicit' economy'.
I, for one, am not convinced that making comparisons from different periods is a fruitful or sound historical exercise. The issues facing today's developing countries are far different to those of eighteenth-century England. Equally problematic is the fact data collected in eighteenth-century England is notoriously unreliable and alien to twentieth/twenty-first century statistical processing. Nonetheless I do take Smith's point and would certainly welcome a study of tax incidence, despite the formidable mountain such a project would entail.
With regard to the 'informal/illicit' economy, I was keen from the outset not to romanticise it. In this sense I revealed the brutality and sophisticated organisation of eighteenth-century smuggling. As I wrote on page 165: 'Between 1723 and 1730 more than 250 officers had been physically injured and at least six murdered. Like the state, the smugglers had their own system of terror'. This notoriously-neglected aspect of economic history is in dire need of examination, and I was keen to demonstrate its extent and importance - and not necessarily negative impact - in shaping economic evolution in England. My use of the term 'common economy' was carefully and specifically intended to contrast it with the legal or licit economy. To take it out of the context of England during the long eighteenth century, let alone geographical region and context, would lumber it, no doubt, with a sense outside its intended meaning.
Sticking with the theme of administrative evolution and economic development, Smith also feels I should have focussed more 'in the areas of technological innovation and entrepreneurial motivation'. There is certainly something in this but it should also be emphasised that a great deal of innovation in industry was organisational, as well as involved in new product lines rather than advanced technology. It is precisely here that administrative and industrial innovation dovetailed. At the level of 'technological innovation' I did devote one whole chapter on the subject, but in the realm of administrative developments and fiscal reform; while, contrary to the usual historiography, I was keen to reveal 'entrepreneurial motivation' within the common economy and efforts to circumvent state regulation.
Let me conclude by again thanking Smith for an extensive and stimulating review that has forced me to dwell and reflect usefully upon particular issues raised in my book.
Notes
1. Joseph E. Inikori, Africans and the Industrial Revolution in England: A Study in International Trade and Economic Development (Cambridge University Press: Cambridge, 2002); David Ormrod, The Rise of Commercial Empires: England and the Netherlands in the Age of Mercantilism, 1650-1770 (Cambridge University Press: Cambridge, 2003) [for a review of this latter book on these pages, please click here].
