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Jealousy of Trade: International Competition and the Nation-State in Historical Perspective
This collection explores eighteenth-century theories of international market competition that continue to be relevant for the twenty-first century. “Jealousy of trade” refers to a particular conjunction between politics and the economy that emerged when success in international trade became a matter of the military and political survival of nations. Today, it would be called “economic nationalism,” and in this book Istvan Hont connects the commercial politics of nationalism and globalization in the eighteenth century to theories of commercial society and Enlightenment ideas of the economic limits of politics.The book begins with an analysis of how the notion of “commerce” was added to Hobbes’s “state of nature” by Samuel Pufendorf. Hont then considers British neo-Machiavellian political economy after the Glorious Revolution. From there he moves to a novel interpretation of the political economy of the Scottish Enlightenment, particularly of David Hume and Adam Smith, concluding with a conceptual history of nation-state and nationalism in the French Revolution. Jealousy of Trade combines political theory with intellectual history, illuminating the past but also considering the challenges of today.
559 pages, Paperback
First published August 31, 2005
About the author
Istvan Hont
4 books3 followersIstván Hont was a Hungarian-born British historian of economics and political thought.
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April 3, 2026
Without doubt, this book will have a major impact on lots of thinkers, as it is clearly well-thought, embedded in sharp debates on the history of political thinking, and with an eye on the present debates. But I will not be one of them, for the book overloads you with highly detailed discussions on 18th century thinkers without a clear thread whatsoever. I am happy I did not put the book down after a 160 (!!) page introduction after which I could not distill one single argument this book is going to make (!!). The chapters are stand-alone articles which are more easily to follow (still not great though). The author clearly has to rethink his approach and style if he wants to reach a broader audience, which would be good since the material and insights are there.
This book is about the 18th century thinking on the cross-determination of political and the economic. It brings political thinkers such as Hobbes and Machiavelli into conversation with economic thinkers such as Smith and Steuart. Because of the military pressure of the international state-systems, sovereignities were rethinking themselves fiscally and financially to finance their many wars. Politics and economics became intermingled. Reconstructing these debates gives us insights into the early promises of commercial society and how they interacted with political coercion.
According to Hume, a central figure for Hont, the “jealousy of trade” was a conflation of the two systems. Before, trade was never an affair of the state, but now they got intermingled in a post-Machiavellian view, where polities tried to control trade to gain an upperhand in their rivalry. When trade solely became the focus of political attention, truly modern politics would be born. There was a straight line from Hobbes jealousy of state towards the new jealousy of trade.
But trade only became an affair of the state once the large monarchies of Europe took up the challenge of posed by the maritime powers Holland and England. They started introducing liberty to foster trade in the name of the state, of which the physiocrats are the best example. Hume argued that this introduction of liberty eventually also undermined their domestic system of power. While England was ruled by commercial interests, France pursued commercial interests, but as subservient to military and political goals of the French absolutist state.
Behind these movements, an interesting debate between Smith and the physiocrats emerged, discussed in chapter 5. Smith and the pyshiocrats both wanted to free the economy from feudal and mercantilist shackles, and shared a similar intellectual starting point with the ‘natural jurists’ which proclaimed a kind of stages of history theory to naturalise private property. From this, Smith proposed to see history in four stages, of which the third one was an agricultural society, from which slowly commercial society could be born (the fourth and last one), when agriculture became productive enough to foster non-productive (aka, non-agricultural) workers. Both Smith and the physiocrats thus thought that liberty was crucial for these stages in histories. Both also agreed that European history had a strange “reversed” pattern in this history. This means that commercial trade took a large spot in their economies quite early, before their agriculture was developed enough (to see this argument in more detail of Smith, and particularly how we contraposed this history to Chinese economic history, see Arrighi’s book “Smith in Beijing”!). But they diverged on a crucial point: the physiocrats wanted to force “natural history” on France, by having the monarch push agriculture as a new growth regime to counterpose the English and Dutch dependency on trade (which they saw as being subsumed by the dictates of the foreign markets), while Smith argued that we should accept this “history in reverse” and work with it. Smith argued that monarchs had no business in correcting the history of Europe.
This was not only a threat for the French “underdeveloped” state. Chapter 2 of this volume shows how England, after the Revolution, became more obsessed with building its commercial power in the international context of rivalry. Holland was the first nation to be threatened by a new state system where there was not just a complementary relation between small commercial polities and territorial states, but where the latter were trying to find their role in commerce as well. But they had to account for the fact that markets were detached from polity itself, and had different rules. To win in markets, you had to be competitive, and this is what the state should provide. This was all the more the case for commercial states such as England. As the modern war placed the most brutal burden on a nation’s finances, Charles Davenant pressed the point that England had to abstain from any anachronistic interference with trade, because the inflicted damage would ruin its base of power and wealth. It had to control passion and appetites which would have “corrupting” consequences. This was not necessarily found in imperial ambition: they only needed to win in the dominion of trade, by making sure they dominated the global markets.
It is also these fears that animated the so-called “Rich country – poor country” debate in England, discussed in chapter 3, spilling over in debates over Ireland’s position in England. Political economists wanted to maintain British supremacy in trade and manufacturing, and they struggled to find the appropriate political tools to do so. Some argued that the British had to push out foreign competitors, underdeveloped regions with low wages, by political (aka imperial) force, such as Ireland. This was also Davenant’s position. Others argued that trade would incentivize the British to switch production, or raise productivity, without it having any impact on the relative position of British status (as long as it could adapt to market demand, of course).
Moreover, this preoccupancy of the British position also sparked debates over the role of public debt and the rentiers behind it as a precondition for British power, as discussed in chapter 4. David Hume’s quote that “either the nation must destroy public credit, or public credit will destroy the nation” is the starting point of Hont’s discussion. For Hume, commerce was a precondition to generate debt, but it was simultaneously a diversion from the better pathway commerce should take. The real antithesis was a durable peace, in which public debt ceased to exist while commerce expanded. While Britain needed to invest in a balance of power, which needed wars of “cautious politics”, mainly focused on checking French territorial ambitions in Europe, it should not do more. He even discussed the option of having an absolutist moment in England to check the commercial interests invested in public debt. This would give rise to an absolutist ruler that no one had seen before, for he would rule over a wealthy and fiscally efficient state.
Adam Smith similarly lamented the fact that commercial growth had increased and intermingled warlike passions. Trade had, instead of promoting peace, become “the most fertile source of discord and animosity”. (p. 54) Instead of “national friendship”, we received “mercantile jealousy”. In the British context, he blamed the mercantile class for imposing its interests on the state, which would do the nation no good. It was a particularly corrupt version of reason of state. As Hont summarizes: “Jealousy of trade became the characteristic response of losers in international competition, or the policy of latecomers. For Smith it was the policy of states that fell under the sway of merchants and manufacturers, who lured governments into believing that the protection of their profits was a precondition of both national security and national welfare.” (62) The Wealth of Nations was designed to destroy the jealousy of trade.
Chapter 6 and 7, at last, give more insight into political ideals. Chapter 6 focuses on Smith’s political outlook. Hont characterizes Smith’s position as linked to natural jurisprudence, which gave him the tool to theorise the limited role of government in a market society. Liberty was first and foremost a passive term, a right to enjoy and improve one’s property free from encroachment. Individuals could be virtuous, but society as a whole could not, and its destiny was more of a pathway of unintended consequences of discrete acts of self-interest. In contrast stood the Renaissance civic paradigm, where liberty had an active sense of enjoyment of rights in citizenship. There was a call for a restraint of self-interest in the interests of the civic good. History was not the outcome of unintended consequences of self-interested actors, but the struggle of civic institutions of self-government to survive the cycle of corruption. The social structure could be moralized. But as Smith made an argument that only the first could lead to actual economic growth and abundance for all, despite inequality, it always had to be chosen over the second.
The 7th chapter talks about the nation-state and the Jacobin position towards it. In many ways, the absolutist ruler in France represented Hobbes’ ruler as the apex of society. Quentin Skinner has interpreted the second half of the 18th century as faced with rising popular republican opposition to modern sovereignty, against which Hobbesian thought was used as a counter-revolutionary weapon. After the Revolution, in the continuing presence of an violent international order which pushed states to become more absolutist, the Jacobins proposed a new kind of “nationalist” statecraft, in which the French republic had to be defended, but opposed in general this whole system. They wished to opt out of this international system of rivalry. Robespierre objected all plans of warfare, except for defensive ones. In the face of foreign threat and civic warfare, the Jacobins retreated into a spectacular application of reason of state. The French Revolution was thus not the “birthplace” of nationalism – it opposed modern balance of states, but was also not merely the continuity of state-building as seen in the 18th century – again, they wanted to reimagine nations in an era of constant warfare.
Quote of Charles Davenant: “Of all beings that have existence only in the minds of men, nothing is more fantastical and nice than Credit, it is never to be forced; it hangs upon opinion; it depends upon our passions of hope and fear;it comes many times unsought for, and often goes away without reason; and when once lost, is hardly to be quite recovered.” (p. 236-237)
This book is about the 18th century thinking on the cross-determination of political and the economic. It brings political thinkers such as Hobbes and Machiavelli into conversation with economic thinkers such as Smith and Steuart. Because of the military pressure of the international state-systems, sovereignities were rethinking themselves fiscally and financially to finance their many wars. Politics and economics became intermingled. Reconstructing these debates gives us insights into the early promises of commercial society and how they interacted with political coercion.
According to Hume, a central figure for Hont, the “jealousy of trade” was a conflation of the two systems. Before, trade was never an affair of the state, but now they got intermingled in a post-Machiavellian view, where polities tried to control trade to gain an upperhand in their rivalry. When trade solely became the focus of political attention, truly modern politics would be born. There was a straight line from Hobbes jealousy of state towards the new jealousy of trade.
But trade only became an affair of the state once the large monarchies of Europe took up the challenge of posed by the maritime powers Holland and England. They started introducing liberty to foster trade in the name of the state, of which the physiocrats are the best example. Hume argued that this introduction of liberty eventually also undermined their domestic system of power. While England was ruled by commercial interests, France pursued commercial interests, but as subservient to military and political goals of the French absolutist state.
Behind these movements, an interesting debate between Smith and the physiocrats emerged, discussed in chapter 5. Smith and the pyshiocrats both wanted to free the economy from feudal and mercantilist shackles, and shared a similar intellectual starting point with the ‘natural jurists’ which proclaimed a kind of stages of history theory to naturalise private property. From this, Smith proposed to see history in four stages, of which the third one was an agricultural society, from which slowly commercial society could be born (the fourth and last one), when agriculture became productive enough to foster non-productive (aka, non-agricultural) workers. Both Smith and the physiocrats thus thought that liberty was crucial for these stages in histories. Both also agreed that European history had a strange “reversed” pattern in this history. This means that commercial trade took a large spot in their economies quite early, before their agriculture was developed enough (to see this argument in more detail of Smith, and particularly how we contraposed this history to Chinese economic history, see Arrighi’s book “Smith in Beijing”!). But they diverged on a crucial point: the physiocrats wanted to force “natural history” on France, by having the monarch push agriculture as a new growth regime to counterpose the English and Dutch dependency on trade (which they saw as being subsumed by the dictates of the foreign markets), while Smith argued that we should accept this “history in reverse” and work with it. Smith argued that monarchs had no business in correcting the history of Europe.
This was not only a threat for the French “underdeveloped” state. Chapter 2 of this volume shows how England, after the Revolution, became more obsessed with building its commercial power in the international context of rivalry. Holland was the first nation to be threatened by a new state system where there was not just a complementary relation between small commercial polities and territorial states, but where the latter were trying to find their role in commerce as well. But they had to account for the fact that markets were detached from polity itself, and had different rules. To win in markets, you had to be competitive, and this is what the state should provide. This was all the more the case for commercial states such as England. As the modern war placed the most brutal burden on a nation’s finances, Charles Davenant pressed the point that England had to abstain from any anachronistic interference with trade, because the inflicted damage would ruin its base of power and wealth. It had to control passion and appetites which would have “corrupting” consequences. This was not necessarily found in imperial ambition: they only needed to win in the dominion of trade, by making sure they dominated the global markets.
It is also these fears that animated the so-called “Rich country – poor country” debate in England, discussed in chapter 3, spilling over in debates over Ireland’s position in England. Political economists wanted to maintain British supremacy in trade and manufacturing, and they struggled to find the appropriate political tools to do so. Some argued that the British had to push out foreign competitors, underdeveloped regions with low wages, by political (aka imperial) force, such as Ireland. This was also Davenant’s position. Others argued that trade would incentivize the British to switch production, or raise productivity, without it having any impact on the relative position of British status (as long as it could adapt to market demand, of course).
Moreover, this preoccupancy of the British position also sparked debates over the role of public debt and the rentiers behind it as a precondition for British power, as discussed in chapter 4. David Hume’s quote that “either the nation must destroy public credit, or public credit will destroy the nation” is the starting point of Hont’s discussion. For Hume, commerce was a precondition to generate debt, but it was simultaneously a diversion from the better pathway commerce should take. The real antithesis was a durable peace, in which public debt ceased to exist while commerce expanded. While Britain needed to invest in a balance of power, which needed wars of “cautious politics”, mainly focused on checking French territorial ambitions in Europe, it should not do more. He even discussed the option of having an absolutist moment in England to check the commercial interests invested in public debt. This would give rise to an absolutist ruler that no one had seen before, for he would rule over a wealthy and fiscally efficient state.
Adam Smith similarly lamented the fact that commercial growth had increased and intermingled warlike passions. Trade had, instead of promoting peace, become “the most fertile source of discord and animosity”. (p. 54) Instead of “national friendship”, we received “mercantile jealousy”. In the British context, he blamed the mercantile class for imposing its interests on the state, which would do the nation no good. It was a particularly corrupt version of reason of state. As Hont summarizes: “Jealousy of trade became the characteristic response of losers in international competition, or the policy of latecomers. For Smith it was the policy of states that fell under the sway of merchants and manufacturers, who lured governments into believing that the protection of their profits was a precondition of both national security and national welfare.” (62) The Wealth of Nations was designed to destroy the jealousy of trade.
Chapter 6 and 7, at last, give more insight into political ideals. Chapter 6 focuses on Smith’s political outlook. Hont characterizes Smith’s position as linked to natural jurisprudence, which gave him the tool to theorise the limited role of government in a market society. Liberty was first and foremost a passive term, a right to enjoy and improve one’s property free from encroachment. Individuals could be virtuous, but society as a whole could not, and its destiny was more of a pathway of unintended consequences of discrete acts of self-interest. In contrast stood the Renaissance civic paradigm, where liberty had an active sense of enjoyment of rights in citizenship. There was a call for a restraint of self-interest in the interests of the civic good. History was not the outcome of unintended consequences of self-interested actors, but the struggle of civic institutions of self-government to survive the cycle of corruption. The social structure could be moralized. But as Smith made an argument that only the first could lead to actual economic growth and abundance for all, despite inequality, it always had to be chosen over the second.
The 7th chapter talks about the nation-state and the Jacobin position towards it. In many ways, the absolutist ruler in France represented Hobbes’ ruler as the apex of society. Quentin Skinner has interpreted the second half of the 18th century as faced with rising popular republican opposition to modern sovereignty, against which Hobbesian thought was used as a counter-revolutionary weapon. After the Revolution, in the continuing presence of an violent international order which pushed states to become more absolutist, the Jacobins proposed a new kind of “nationalist” statecraft, in which the French republic had to be defended, but opposed in general this whole system. They wished to opt out of this international system of rivalry. Robespierre objected all plans of warfare, except for defensive ones. In the face of foreign threat and civic warfare, the Jacobins retreated into a spectacular application of reason of state. The French Revolution was thus not the “birthplace” of nationalism – it opposed modern balance of states, but was also not merely the continuity of state-building as seen in the 18th century – again, they wanted to reimagine nations in an era of constant warfare.
Quote of Charles Davenant: “Of all beings that have existence only in the minds of men, nothing is more fantastical and nice than Credit, it is never to be forced; it hangs upon opinion; it depends upon our passions of hope and fear;it comes many times unsought for, and often goes away without reason; and when once lost, is hardly to be quite recovered.” (p. 236-237)
May 30, 2021
so badly written i might have to miss out on the research. amazing
April 14, 2022
Per me a mani basse uno dei capisaldi di questo argomento.
Displaying 1 - 3 of 3 reviews