Chapter 3 - Economic Problems And Royal Finance Flashcards
How big was the population by 1780?
27 million
How much bigger was the population compared to GB?
3x
What neighbors were politically fragmented?
Germany and Italy
What did France follow Britain in?
Improved agricultural techniques:
Crop rotation
Fertilisers
Growth of American potatoes and maize
Where was France in Trade?
Second to GB
Who did France trade with?
Colonies
(This quadrupled)
How did transport improve from Paris to Toulouse?
Did take 15 days, 1780’s took 8 days
Who maintained the roads?
Corvée royale
What was the corvée royale?
Obligation of every male to do unpaid labour
What was introduced to increase industrial production?
Mechanisation
What helped trade in France?
Paris becoming the centre of banking
Why was the farming backwards compared to the Dutch and British?
Seigneurial arrangements
Rise in population
Farming families dividing land between sons
What was the problem with food growth?
It couldn’t keep up with the population
What type of farming did they practice?
Substant
Why didn’t many people improve their farming practices?
Mostly peasants who couldn’t afford to
No incentives
What made trade easy for fraud?
No regulated weights and measures
How many different units of measure were there?
25,000
What other barriers were there?
Few navigable waterways
Many restrictions/regulations
Trades restricted to certain cities
Lack of competition
Tariffs
Why did businessmen and traders fear paper notes?
French banking system wasn’t advanced
Borrowing scheme had collapsed
What was the staple diet in France?
Bread
What caused the price of bread to rise?
4 consecutive years of bad harvests
How much did wheat prices rise?
88%
What reduced the french textile industry?
British imports
How did the poorest respond?
Food riots
Attacked grain stores
How much of wages was spent on bread?
50% then 88%
How was the government financed?
Direct and indirect taxation
What were the main direct taxes?
Taille
Capitation
Vingtième
What was the Taille?
Tax on property and income of the third estate
What was the Capitation?
Payable by everyone but the clergy paid the don gratuit
Second estates payment varied on rank
What was the don gratuit?
A ‘voluntary gift’
Paid by the church every 5 years
Around 2% of total revenue
What was the Vingtième?
5% of earnings from:
Land
Property
Commerce
Official offices
What were the main indirect taxes?
Gabelle
Aides
Traite
Octrois
What was the Gabelle?
Salt tax
What was Aides?
Consumption tax (VAT)
What was the Traite?
Customs duty
What was the Octrois?
Local customs duties in towns
Who collected taxes?
Royal officers
What was tax farming?
Second largest employer
People bought a lease of 6 years to collect taxes
What were the tax farmers called?
Ferme générale
Why was it difficult to anticipate income?
No treasury or central banking system
Why was not having a treasury a problem?
Couldn’t budget accordingly
How much did the War of Austrian succession cost?
1 billion livres
How much did the Seven Years war cost?
1.8 billion livres
How much debt was there when Louis XVI died?
2 billion livres
How did Louis XVI increase the debt?
Supporting the American revolutionaries
How much debt did France have after the American war?
3.3 billion livres
What were the main sources of crown income?
Gabelle - everyone used salt as a preservative
Vingtième
Taille
What percentage of expenditure went on debts?
43%
What percentage was spent on the war department?
25%
Who were the main people appointed to help the economic situation?
Turgot
Necker
Calonne
What was the position name for finance ministers?
Controller General
What were Turgot’s proposals?
Removed price controls
Abolished guilds
New property tax
Reformed tax farming
Apposed participation with Americans
Got 4% loan with Dutch bankers
What were the problems with Turgot’s proposals?
Secret volunteers to the USA
6 Edicts offended MA and influential people
Poor harvests brought up bread prices
What were Neckers proposals?
Cut venal offices
Removing Vingtième
Encouraged participation of American war
Issued the first public report of the finances
What were the problems with Necker’s proposals?
Venal offices leant money
Publication was seen as a breach of royal protocol
USA involvement caused more debts
Couldn’t borrow and tax lost
What were Calonne’s proposal’s?
A general land tax (No Vingtième)
Stamp duty
End of corvée royale
Removal of control off grain trade and internal barriers
What were the problems with Calonne’s proposals?
It would deconstruct the hierarchy if all were taxed
Not backed by other ministers
Had to be put to an ‘Assembly of Notables’
