ECONOMIC THEORY, REFORMISM, AND THE EMERGENCE OF ECONOMIC RIGHTS: MODELS OF IDENTIFICATION AND DISSOCIATION IN THE EUROPEAN CORPORATIONS OF TRADES DURING THE “LONG” EIGHTEENTH CENTURY

Abstract

This study addresses the incompatibility question between the corporate organization of industry and a system based on the general recognition of economic rights and freedoms in continental western Europe. A dissociation/identification model based on a comparative analysis verifies the consistency of the premise that makes the emergence of economic rights possible only after suppressing the corporations of trades. The model stems coherently from the ideas of eighteenth-century political economists and crystallizes in reform policies aimed at eliminating corporate elements contrary to economic freedoms. The results directly link the intellectual model and the actual expressions of economic rights within the declarations written at the end of the old regime. While dissociation creates an opportunity for corporate continuity within a framework of recognized economic freedoms, the French identification model implies the suppression of corporations.

I. INTRODUCTION

A vague conceptualization and relatively little research on their historical origins have constrained the study of economic rights, making it challenging to understand the varying evolution of guild corporations. The notion of economic rights has a relative nature, and it is context-specific. From the traditional point of view, economic rights refer to property. In the 1770s, the French supporters of a guild system under attack linked the guilds’ continuity to protecting property rights (Kaplan 1986, p. 196). Contrariwise, the guilds’ critics pondered that each man was the sole owner of his labor. It constituted a natural right and a sacred and imprescriptible property that no regulation could constrain ([Lemercier de la Rivière] 1770, p. 41; Édit du Roi … Février 1776, p. 5; Messerlé 2021, pp. 61–62).

Legal historiography expanded the term to include the freedom of enterprise and the freedom of work. However, some confusion as to the identity of these rights persists. Still, for Thomas H. Marshall, economic rights lack any identity of their own (Marshall and Bottomore 1992). Additional enlargements include newer rights related to the so-called welfare state (Preuss 1988) in such a way that economic rights intertwine with social rights (Cottrell and Ghai 2004; Minkler 2013; Riedel, Giacca, and Golay 2014). However, economic rights also relate to a recurrent historical debate between the individual and the collective expressions of economic organization (Levy 1995). Within the context of the European Union, they have come to identify with the so-called fundamental freedoms (free movement of goods, capital, services, and labor), and, lately, with the economic side of the European integration, as opposed to “social Europe” (de Vries 2018, pp. 2ff).

This study fills the gap on the historical origins of economic rights and the context in which they emerge and sheds light on their definition. In this paper, economic rights primarily concern the freedom of production (the right to produce any commodity and undertake business activities) and the freedom of work (the right to hire other people’s labor and engage in a contractual labor relationship).

The interpretation of the nature of European craft corporations and the industrial structure during the “long” eighteenth century deals directly with the origins of economic rights at the end of the old regime. The European industry during this transformation period is often described in terms of incompatibility between two systems, one based on corporate principles and the other on a liberal, free-market structure (Minard 2004). For authors writing in the late nineteenth and early twentieth centuries, the industrialization process deprived the corporations of their traditional purpose (Brentano 1870, pp. clxiii, clxiv; Unwin 1908, p. 351). More recently, the debate (Ogilvie 2004, 2008; Epstein 2008b) between the scholars who see the guild system as a serious obstacle to the industrialization process (Reddy 1984, pp. 36ff; Ogilvie 2007, 2008) and those who consider the rehabilitation of their historical role shows how lively is the interest in this matter (Epstein 2008a; Berlin 2008). In this light, there is a strong belief that the abolition of craft organizations brings about the birth of economic freedoms. The traditional view concerning the origin of economic rights in continental Europe assumes that the French abolition model applies universally (Unwin 1908, p. 1; Stearns and Chapman [1975] 1992, p. 171; Crouch 1993, p. 314; Ogilvie 2019, p. 534). As the corporate system identifies with the socio-economic basis of the old regime, the crisis of absolutism drags corporations down. Consequently, the rise of economic rights inevitably accompanies the extinction of the guild system that restricts them.

This study addresses the compatibility between the corporate organization of the industry and the general recognition of economic rights in continental western Europe. It examines the impact of a potential identification/dissociation model on the emergence of economic rights by evaluating eighteenth-century économistes politiques’ ideas, the implementation of reform policies, and the declarations of economic rights at the end of the old regime.

The cultural and intellectual foundations of economic change within a dynamic context have attracted considerable attention (Jones 1995; Guiso, Sapienza, and Zingales 2006; Cunningham, Banks, and Potts 2008), particularly in the framework of the “ideas versus interests” debate. For some scholars, institutional and organizational changes supported by shared beliefs brought about democracy and development, as was the case of Britain after the Glorious Revolution (North, Wallis, and Weingast 2009). Political institutions are the key to democratization since they can transform the distribution of power through a credible commitment between elites and citizens (Acemoglu and Robinson 2006, pp. 26–27). Contrariwise, for Deirdre McCloskey, “What changed in Europe, and then the world, was the rhetoric of trade and production and betterment” (McCloskey 2021, p. 78), and, therefore, what mattered were extended ideas rather than material interests. Joel Mokyr’s studies on England before (Mokyr 2017) and during the eighteenth century (Mokyr 2009) pointed out the development of an “Enlightened economy” as a basis for the Industrial Revolution. This study does not show the advantages of a biased view but the interaction between institutions, ideas, and interests (Campbell 2002).

The results indicate that the mainstream eighteenth-century political economists propose removing anti-competitive elements rather than completely suppressing the corporate system. The intellectual model of dissociation between the guilds and the monopolies or exclusive privileges they retained leads to a compromise strategy between corporate continuity and the free market. Several European governments implement reform policies to eliminate anti-free market elements without abolishing the guild structure. By contrast, a divergence in French economic thought, which identifies guilds and monopolistic restrictions, calls for the complete abolition of the corporate system. On the other hand, there is a direct link between the eighteenth-century model of dissociation and the new parameters of the economic system that emerge after the collapse of the old regime. In most cases, the declarations of economic rights do not imply the abolition of the corporate structure, except in France, where the suppression, eventually imposed after a brief first attempt in February 1776, is a unique development associated with the emergence of the freedom of work and production.

II. CRITICISM AND REFORM IN THE ÉCONOMISTES POLITIQUES’ MIND: A DISSOCIATION MODEL

During the eighteenth century, most political economists’ critiques focused on the free-market distortions resulting from guild corporations’ activity. Criticism targeted the production system based on corporate patterns and the rigidity of the guild labor system, which benefited only a few masters and resulted in a general increase in prices. Worst of all, the corporations received such restrictive advantages as privileges. As Gerónimo de Uztáriz pointed out as early as 1724, restrictions on production or work awarded as special privileges were detrimental to the general interest (Uztáriz 1757, p. 331). Uztáriz’s Theórica y práctica de comercio had resonance in the circle of Vincent de Gournay, a resolute advocate of free competition. It was translated into French by François Véron Duverger de Forbonnais (Forbonnais 1753c) to serve the purposes of the economic policy that the circle wished to implement (Guasti 2014). Attacks on privileges proliferated. In the mid-century, authors like Giuseppe Antonio Costantini or Johann Heinrich Gottlob von Justi decried the privileged restrictions contained in corporate ordinances leading to the stagnation of the industry (Cosentino [1749] 1762, pp. 90–91; Adam 2006, pp. 202, 238).

In the middle of the century, there was a flourishing of publications on economic theories. Although some of them followed relatively radical directions, as Simone Meyssonnier notes in the Gournay group (Meyssonnier 1989, pp. 263–275), criticism led to reform proposals and not to a general request for abolition. Guild reorganization involved removing corporate elements inconsistent with free competition, which implied a dissociation between guilds and economic restrictions. For Jean François Melon, the abuses of the maîtrises were just a “ridiculous waste of time,” while maîtrises themselves might be “même nécessaires dans bien des professions” ([Melon] 1735, pp. 117–118).

Jacques Claude Marie Vincent de Gournay’s circle members, including Gournay himself, Forbonnais, or his cousin Louis-Joseph Plumard de Dangeul, distinguished between the organized trades and the restrictions on the freedom of labor and production. Gournay tried to identify the obstacles affecting the French industry vis-à-vis its English or Dutch competitors. While manufacturing and labor market flexibility was the rule in England and Holland, the restrictions imposed by guild organizations resulted in higher prices in France. Gournay was particularly concerned about corporate regulations, which had established monopolies through compulsory apprenticeships or rigid production rules. He stood for their removal (Tsuda 1993, pp. 135, ¹ 140–141, ² 141–142 ³). A report (Mémoire) concerning silk manufactures sent to the Chamber of Commerce of Lyon developed this notion (Tsuda 1993, pp. 13–26; Charles, Lefebvre, and Théré 2011, pp. 333–343).

When Gournay addressed the measures required to redress the French production system, he repeatedly called for suppressing corporate regulations’ production, labor, and trade restrictions. Some indirect references to eliminating the corporate system itself appear in his works, the clearest of which is related to the remarks on Josiah Child’s writings on trade (Meyssonnier 2008, p. 176). The opposition of some governmental sectors against the new ideas could have resulted in a sort of self-imposed censorship in Gournay’s texts: the remarks remained unpublished because of his risky stands on government policy (Tsuda 1983, p. 450). Still, he was directly calling for removing regulations and restrictions, not the abolition of guilds. ⁴ Such allusions were indirect at best and scarce compared with the continuous mentions of guild reform. The intendant did not cross the abolition line unambiguously.

The influence of Gournay on the other two authors’ writings (Morellet 1823, p. 38; Murphy 1986a, p. 531) determined the perspective they shared. Under the pseudonym of John Nickolls, Plumard de Dangeul criticized in 1754 all exclusive privileges laid down in guild regulations (Nickolls 1754, pp. 26–27). For Forbonnais, the corporate organization of labor and production was not objectionable per se. Corporate rules imposing expenses and formalities for the receptions of masters were privileges granted to ensure a particular benefit against free competition and monopolistic abuses sustained by seizures and fines ([Forbonnais] 1753a, pp. 334–335, 724). However, a corporation that allowed unfettered access could not be detrimental to the industry. Therefore, it was necessary to do away with harmful regulations without necessarily affecting the very existence of corporations ([Forbonnais] 1753b, p. 741).

In 1758, another member of the Gournay’s circle, Simon Clicquot de Blervache, developed further a specific dissociation perspective in an essay supposedly published in London ([Clicquot] 1758c), The Hague (signed by M. Delisle, Clicquot’s pseudonym, [Clicquot] 1758b), and in Amsterdam ([Clicquot] 1758a). ⁵ The secrecy about authorships (the Amsterdam and London editions do not mention any author) was due to the reluctance to unambiguously expose novel economic ideas or changes that might attract the animosity of particular sectors of the French administration at the time. It was also due to the secrecy of the information provided (Charles 2011, pp. 83–84): Gournay could have supplied the specifics of the debt contracted by the Lyon silk corporations (Sewell 2021, p. 280); hence the virtually unanimous attribution of the work to Clicquot and Gournay. The latter was a member of the Amiens Academy that awarded a prize to Clicquot’s essay in 1757. The idea of Gournay’s involvement came from Pierre Samuel du Pont de Nemours, who mentioned that the work was written by “M. de l’Isle, sous les yeux et avec les conseils de l’illustre M. de Gournay” (“Avertissement” 1770, pp. xxxviii–xxxix). ⁶ However, the actual participation of Gournay in the text is not evident.

The central notion running through Clicquot’s Considérations sur le commerce revolved around free competition, necessary for trade and industrial development, while corporate restrictions were conducive to industrial stagnation ([Clicquot] 1758a, pp. 20ff, 68ff, 109–110, 159–160). Such restraints, contained in corporate rules, should be eradicated ([Clicquot] 1758a, pp. 18, 19, 21–22, 24, 71–72, 83, 106–109, 158). It is difficult to conclude from reading the Considérations that Clicquot was an early promoter of guild abolition. Cliquot was as far from radicalism in suggesting the liberalization of the guilds as he was from calling for the fragmentation of the aristocratic domains. In his Mémoires sur les moyens d’améliorer en France la condition des laboureurs, Clicquot defended the abolition of seignorial rights (droits féodaux). Nevertheless, he did not try to dispossess the French aristocracy but improve agricultural production and work and combine seigneurs and cultivators’ interests (Clicquot 1789, pp. 74, 77–78, 79ff). Clicquot refused to follow a revolutionary path and preferred an orderly process of change led by the government (Clicquot 1789, pp. 141ff).

Although the Academy of Amiens proposed three questions as a guideline that accepted the abolition of corporations as a premise, the answers of the Considérations did not correspond to the questions addressed. The first question suggested discussing the obstacles that the corps de métiers opposed to the industry and what advantages would result from their elimination. However, the author(s) did not assume the second part of the proposal ⁷ ([Clicquot] 1758a, p. 103) and elaborated the response on criticisms of the regulations and reform suggestions, which appeared sixteen times in the text. Direct attacks on the corporations themselves occurred three times and were always in a qualified form. For example, elsewhere in the text, Clicquot explained that “L’effet naturel des Corporations est d’augmenter le prix des Ouvrages.” However, such effect was due to the abuses imposed by their regulations, and therefore privileges and regulations were responsible for the increase of prices ([Clicquot] 1758a, pp. 46–49). In short, most of the response was devoted to suppressing corporate privileges ([Clicquot] 1758a, pp. 56–105). In the same vein, the answer to the third question proposed by the Academy (“Quelle seroit la meilleure méthode de procéder à la suppression de ces Corps?”) unambiguously stated that reforms were necessary to redress corporate organizations ([Clicquot] 1758a, p. 174).

Furthermore, the Considérations demanded a liberalized guild structure that would not hinder the development of industry and commerce. After a radical reform, guilds could continue existing without their old monopolistic advantages. Regulations would become a set of non-mandatory good practices accessible to workers. Interestingly, the Considérations differed from Gournay’s opinion concerning the producer’s marks. Clicquot sought to maintain the marks aimed to identify the quality of manufactures. Reduced apprenticeships could also help ensure trade continuity ([Clicquot] 1758a, pp. 58, 105, 107–108, 157–164).

Anne Robert Jacques Turgot was also connected to the circle of Gournay (Sewell 2021, pp. 191ff). As contrôleur général des finances (1774 to 1776), he is known for being the driving force behind the so-called Six Édits, one of which abolished the corporations of trades in France in February 1776. Turgot’s conception of political action involved an idea of human history based on a linear evolution composed of a succession of progressive phases (Turgot [1750] 1808; Nisbet 1994, ch. 6). His contribution to indefinite progress included economic advancement and required a transformation. However, in Turgot’s intellectual scheme, revolutionary change was not the driving force of history. He preferred the image of the organic growth of a plant producing the desired fruits and flowers (Turgot [1750] 1808, p. 64). Therefore, Turgot’s intentions regarding the abolition of corporations were not apparent in his writings. He argued for the need to eliminate privileges as a means of enhancing industry and trade (Turgot 1757, pp. 40–41). Regulations were the target to beat (Turgot [1754] 1913, p. 376; [1759] 1808, p. 335). In this aspect, there was no difference with the prevailing economic thinking. Although Turgot’s language became increasingly aggressive later (Turgot [1766] 1914, p. 508; [1773] 1808, p. 442), he emphasized the liberalization of the sector rather than abolition, which contrasted with the rare and unstructured precedents of express condemnations of the guild system. In one such precedent, Denis Diderot expressed the conviction that corporations deserved total abolition (Diderot [1767] 1861, pp. 3–4). He also considered the chefs-d’oeuvre unsuitable for certifying a candidate’s skill and pointed out the uselessness of masterpieces and corporations alike (Diderot 1753, p. 273). In the same vein, Antoine-Gaspard Boucher d’Argis identified the jurés with guilds themselves. In other words, corporate executive offices were the same thing as the corporations they led and the reviled functions of inspection, reception of apprentices and masters, and enforcement of regulations they exercised (Boucher d’Argis 1765, p. 65).

Once he acceded to the contrôle général, Turgot’s political actions exposed his intentions rather than his writings. The question of grains, the freedom of wine trade, and a series of measures aimed at moderating the application of guild regulations, including a myriad of partial and sectoral liberalization decisions, heralded the imminent suppression (Faure 1961, pp. 374–375).

The contrôleur backed writers who unequivocally sustained the need to suppress the guilds, as it happened with the 1775 Essai sur l’abus des privilèges exclusifs et sur la liberté du commerce et de l’industrie. The French divergence from the mainstream of European economic thought crystallized in this work, written by Bigot de Sainte-Croix. François de L’Averdy, contrôleur général from 1763 to 1768, commissioned this magistrate in the Normandy Parlement and his father to write about the state of the guilds in France. L’Averdy allegedly intended to abolish the guild structure as part of a broader liberalization policy (Félix 1999, pp. 433ff), but he encountered the insurmountable obstacle of corporate debt. The ten-year delay of the publication was due to the different perspectives held within the government, which resulted in a hitherto erratic policy (Meyssonnier 1990, p. 94). The work appeared in the Nouvelles éphémérides économiques, ⁸ a periodical that had been renamed and relaunched by Nicolas Baudeau the previous year. Despite the ambiguous link between the new contrôleur and the physiocrat background of the journal (Goutte and Klotz 2015), Turgot’s term in office determined its future (Herencia 2013, p. 549).

The Essai repeated traditional criticisms against the limitations and monopolies of corporations. The particular interests of corporations, supported by monopolistic restrictions, disrupted the natural order of things (Bigot 1775, pp. 3–4). However, instead of concluding that corporate flaws needed to be corrected, the Essai called for the guilds’ dissolution. According to Sainte-Croix, in France corporation and privilege were identified as one and the same thing: “Les Corps de Marchands et Communautés d’Arts et Métiers sont de véritables privilèges exclusifs” (Bigot 1775, p. 14). Therefore, the corporations of trades should be suppressed (Bigot 1775, pp. 121). The publication represented a qualitative leap forward regarding the European economic literature.

The extent to which the Essai constituted a theoretical contribution that diverged from the European mainstream becomes more explicit when compared with another work written on commission from the same L’Averdy who had supported Bigot’s work. Chinki, histoire cochinchinoise was a fiction written in 1768 by the abbé Gabriel-François Coyer that tried to make it easier for the public to understand the virtues of free competition. Notwithstanding, Chinki’s ideas differed from the conclusions drawn by Bigot de Sainte-Croix, and their similarities with the Considérations eventually sustained an accusation of literary theft of Clicquot’s work (Magasin encyclopédique 1805, p. 6; “Lettre XI” 1775, pp. 163ff). Imitation was not surprising since Coyer was also a Gournay’s circle member. Chinki centered its critique on corporate regulations through humorous and ironic images that tried to describe the abuses of corporations using a literary strategy (Théré 2013, pp. 38–39). Suggesting the need to transform guild corporations into simple associations devoid of any restrictions on economic freedoms, Coyer used expressions that copied Clicquot almost verbatim (Coyer 1768, pp. 93–95; [Clicquot] 1758a, pp. 157, 163–164).

Although part of the French government shared the idea of the abolition of corporations at the time of the publication of the Essai, the line of thinking that sought solutions to industry problems by liberalizing the corporate structure without suppressing the organizations of trades remained widespread in Europe. Since the early seventeenth century, English courts and politicians dissociated guild corporations from restrictions on economic freedoms. Edward Coke considered that monopolies, conceived as limitations on production or trade granted to individuals or companies by royal concession (Coke 1669, p. 181), were detrimental to the economy. In contrast, guild corporations, excluded from the general prohibition established in the Statute of Monopolies passed in 1623, were not.

Most English authors writing on economic issues followed and elaborated on the model of dissociation. In 1640, John Culpeper targeted monopolistic constraints, leaving aside the corporations. He accused the monopoly holders in Parliament of being “the Leeches that have sucked the Commonwealth” (The Parliamentary 1763, p. 126). ⁹ Josiah Child believed that companies were compatible with the public good only if access to them was easy and inexpensive (Child [1693] 1751, p. 78). He differentiated between perfectly admissible apprenticeships designed to learn the necessary skills and those that allowed the acquisition of a privileged position in exchange for money (Child [1693] 1751, p. 82).

Josiah Tucker (1713–1799) was the author before Adam Smith who most fiercely and systematically decried the constraints of guilds and trading companies. His Elements of Commerce collected and refuted the arguments defending the maintenance of corporate privileges. Tucker was diligent in underlining that he was striking out against monopolies and restrictions, including privileged companies and charters. Guilds could keep “their Furs and Scarlet Gowns, their Colours and Streamers, their Offices and Dignities” to the extent that they did not harm commerce and their exclusivity elements disappeared (Tucker 1931, pp. 131, 137–138).

A year after Bigot’s publication, Adam Smith (1723–1790) systematically criticized the corporations of trades in An Inquiry into the Nature and Causes of the Wealth of Nations. Smith repeated arguments concerning the superfluity of regulations. In general terms, distortions of the labor market introduced a violation of every man’s work, his most sacred patrimony and right (Smith [1776] 1793, I, pp. 184ff, 188, 210ff). Smith was about to overstep the line that Bigot de Sainte-Croix had crossed in France. According to Smith, the very essence of trade corporations affected the economy adversely: “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices” (Smith [1776] 1793, I, p. 188). This passage has been interpreted as a definition of the principle of free competition between firms (Niels, Jenkins, and Kavanagh 2011, pp. 284–285). However, the continuation of the passage shows that Smith’s perspective regarding corporate organizations implied an element of tolerance:

It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary. (Smith [1776] 1793, I, p. 200)

Although he considered them harmful, Smith rejected the idea of suppressing guild corporations precisely because it would involve an inappropriate restriction of freedom.

In Spain, Count Pedro Rodríguez de Campomanes (1723–1802) and Gaspar Melchor de Jovellanos (1744–1811) blamed the corporations of trades for disregarding the common good and selfishly defending their interests but did not advocate the eradication of guilds. They disapproved of the regulations and monopolies that hindered industrial growth (Campomanes 1776, p. cxvii; Jovellanos 1840a, pp. 226–227, 231, 234–236; Jovellanos 1840b, pp. 67–68). They also credited Great Britain for establishing a differentiation between the corporations of trades and the restrictions on competition they might enjoy (Campomanes 1776, pp. cxlvi–clxlix, cliv–clviii, clx; Jovellanos 1840a, p. 238).

For the Count of Campomanes, a general abolition such as France had enforced was not a political option. In his third part of the Apéndice a la educación popular, published after Turgot’s suppression, Campomanes was the first Spanish thinker to assess the ideas of Bigot de Sainte-Croix (Astigarraga 2017, p. 351), which he did not share. Once expurgated of their harmful elements, the organizations of trades would be helpful to the common good and the interest of the State. The minister intended to consolidate a network of corporations focused on the professional training of craftsmen and their mutual assistance (Campomanes 1774, p. cxvi; 1775, pp. 258–259, 270; 1776, p. cxlii). Similarly, Jovellanos’s ideas found a center of gravity distanced from the abolitionist extreme and closer to Necker’s pragmatism since 1785 (Astigarraga 2011; 2017, p. 360).

Nevertheless, there were significant differences between Campomanes and Jovellanos. The Count, advocate general, and later chairman of the Council of Castile, the highest governing body of Spain, built up one of the few examples of corporate viability offered by a European politician critical of the corporate system. We will see in the next section his proposal of State intervention to eradicate anti-free competition elements from every corporate bylaw. Jovellanos, considered the most fervent exponent of Spanish economic liberalism, disagreed with Campomanes’s plan of corporate legal reforms and was firmly in favor of the liberalization of work and production. In his 1785 Informe sobre el libre ejercicio de las artes, Jovellanos used a vocabulary similar to Sainte-Croix (Jovellanos 1840a, pp. 226, 233). However, he essentially agreed with Clicquot de Blervache in maintaining some specific corporate features. Guild vocational training was of value to the industry and worth preserving. Craft organizations could also register craftsmen’s activities (Jovellanos 1840a, pp. 238ff). Moreover, Jovellanos turned away in the French revolutionary wave. Once it began, he expressly rejected the revolutionary path and pointed to the need for gradual reforms to ensure structural economic improvements (Llombart Rosa 2021, p. 114).

Even in the last quarter of the century, no voices were raised outside France for guild abolition. The Neapolitan Gaetano Filangieri focused his attention on the negative consequences of the matricole (entry fees payable for becoming a corporate member) on industrial labor, which resulted in the prevalence of unskilled artisans and a declining production quality (Filangieri 1784, p. 189). According to the Turinese Giambattista Vasco (1733–1796), corporations pursued only particular interests expressed in corporate regulations. The State had to correct the economic limitations established to the detriment of the general good and refrain from implementing unnecessary rules (Vasco 1793, pp. 21ff, 41ff). Neither Filangieri nor Vasco concluded that it was imperative to abolish the corporations of trades. They considered the need to remove barriers to free competition in the form of corporate restrictions (Vasco 1793, pp. 34, 41ff, 94; Filangieri 1784, p. 194).

With some variations, German economic thought also attributed an essential role to the State in correcting the deficiencies of the corporate system and highlighted certain guild aspects that deserved continuity. Von Justi’s position, common to other German authors belonging to Kameralwissenschaft or Cameralism (Tribe 1988, p. 117), favored State intervention to remove guild monopolies and privileges. However, to avoid disorder, the government should not suppress the guilds but exclude them from the new industrial sectors and withdraw their discretionary right to confer master status (Adam 2006, pp. 202, 238).

This line of thought continued until the beginning of the nineteenth century and defined the subsequent political development in unified Germany. German thinkers and politicians amalgamated the advantages of the individual drive with those of professional associationism. Karl Heinrich Rau analyzed the pros and cons of suppressing the corporations of trades in an essay entitled Über das Zunftwesen und die Folgen seiner Aufhebung (On guilds and the consequences of their abolition), published in 1816 (Rau 1816). According to him, the sudden introduction of full economic freedoms was not advisable. It would imply the loss of positive corporate aspects. Guilds ensured work and a livelihood for a group of artisans, maintained the quality and uniformity of different products, and guaranteed the continuity of vocational training (Tribe 1988, p. 186). The curtailment of corporate abuses with as little disruption as possible was a governmental task (Lindenfeld 1997, p. 128). Moreover, Rau’s Volkswirtschaft was related to a concept of organicism that connected the individual with the collective (Lindenfeld 1997, p. 120; Tribe 1988, p. 187). In 1821, Georg Wilhelm Friedrich Hegel deepened this idea and considered that the value of guild corporations also lay in providing their members with a sense of morality indispensable for corporate cohesion (Hegel 1991, p. 273; Black 1984, pp. 12ff).

This section has considered how the majority of the European économistes politiques established the theoretical distinction between guilds and restrictions on economic freedoms as a basis for reforming the corporate system. The model of dissociation insisted on the suppression of corporate regulations containing obstacles to economic liberty. Although political economists identified economic restrictions with specific guild abusive practices, they did not directly match abuses with guilds.

As a result of the intellectual dissociation scheme, restructuring the guild system implied the prospect of its continuity. The following section will examine how the reforms attempted to implement the theoretical dissociation model with varying degrees of success.

III. THE OUTCOME OF DISSOCIATION: REFORMS UNDER ABSOLUTISM AND DECLARATIONS OF RIGHTS AT THE END OF THE OLD REGIME

Most European governments chose a reform policy rather than suppression and developed actions to overhaul the corporate system by removing the elements that restricted economic freedoms. Despite being absolute monarchies with no tolerance for any form of political openness, European countries launched partial and sectoral initiatives to liberalize the economy. Some of them even devised programs to restructure guild production and labor. Eventually, liberalizations would give way to the full recognition of economic freedoms by the new governments emerging after the old regime’s fall. However, the formal emergence of economic rights did not run parallel to the suppression of the corporate system. Except in France, European liberal legislation followed the pattern drawn by eighteenth-century mainstream economic thought.

However, the dissemination of criticisms of the guild system also led to defensive reactions from the supporters of corporate virtues even before Turgot’s suppression. In Spain, Francisco Romà y Rosell (1727–1784) rejected in 1766 all arguments in support of liberalization. Maintaining regulations and guild controls was necessary to ensure product quality and confidence in trade. For Romà, one thing was a privilege to maintain corporate order, and another a monopoly. There were no guild monopolies in Barcelona: anyone could aspire to join a guild, and the number of craftsmen was considerable enough to allow for moderate prices and profits. Moreover, Romà opposed guild security to “the insatiable greed” of individual impulse (Romà 1766, pp. 18, 24–26).

In the mid-eighteenth century, the government of Spain was well aware of the need to undertake reform measures to foster the national industry. José de Carvajal y Lancaster, chairman of the Board of Commerce (Junta de Comercio y Moneda), favored a liberalization policy (González Enciso 2002, pp. 267–268). The Junta adopted a strategy of overriding the harmful effects of corporate penalties or examinations. About twenty years later than Carvajal, Campomanes created a long-lasting model of reform. The Council of Castile would conduct a vast program to review all corporate ordinances, especially regulations describing technical manufacturing aspects or preventing greater freedom in the labor market (Campomanes 1776, p. cxix). The Economic Societies (Sociedades Económicas de Amigos del País), founded throughout the country since 1765 to promote economic progress (Anes 1966, p. 122; Llombart 1981, pp. 190–191; Enciso Recio 2010, p. 123), played a vital role in the count’s reform program (Astigarraga 2003). They were responsible for assessing case-by-case revision proposals and submitting detailed reports to the Council (Campomanes 1775, pp. 286–290). The process effectively started in Madrid and extended to some other regions of the country (Forniés 1978, pp. 109–153; Moral Roncal 1998). Nevertheless, the outcome was not satisfactory due to the determined opposition of corporations (Redondo Veintemillas 1996, pp. 143–144; Actas 1793, pp. 201–204). The Council of Castile, which was supposed to implement the reform (López Castán 1989, pp. 160–161), did not assume its powers to the extent expected.

At the same time, the Spanish government attempted to gradually deregulate specific industrial sectors or liberalize particular areas ( Novísima Recopilación, VIII.XXIV.V, VIII.XXIV.IX, X). As was the case of the silk twisters in 1793, the government suppressed certain corporations and declared the freedom to exercise several trades simultaneously in 1797 ( Novísima Recopilación, VIII.XXIII.XII, VII.X.XI).

In Italy, the kingdom of Sardinia liberalized some crafts and supported an active policy in favor of the expansion of trade but preserved most of the corporate structure (Caligaris 1998, pp. 56–58). Similarly, the Grand Duke Peter Leopold of Tuscany (later Austrian emperor) emphasized the need to promote the free exercise of trades and remove all obstacles to manufacturing progress. However, the Tuscan reforms did not imply a general dissolution. The Editto of 3 February 1770 suppressed different corporate fees but did not involve the extinction of corporations. The abolition of the previous motuproprio of 1 February concerned only several traditional judicial bodies. One of them was the Mercanzia, a commercial court representing the five Florentine Arti Maggiori substituted by a Chamber (“Gazzetta Toscana” 1770, p. 25), whose purpose was the reform of corporate regulations and the creation of a unified commerce code without restrictions on economic freedoms. The project failed, though, and the Chamber dissolved in 1782. Instead of a structured reform, the government implemented a series of sectoral and partial revisions of corporate rules, eventually resulting in a broad liberalization of production and the labor market (Maitte 2002, pp. 72ff).

The Grand Duke’s reformist ideas were successful insofar as the support received from the Florentine privileged strata allowed it. It was not the case of Lombardy, where the liberalization measures introduced by Peter Leopold’s brother, Joseph II, were received as an attack on the Milanese traditional jurisdiction. Neither was it the case of Naples. The privileges of the aristocracy and the clergy had a stagnant effect on the Regno (Duggan 2014).

The reforms undertaken by Emperor Joseph II in Austria had a comparable aim: economic modernization and curtailment of corporate privileges without undermining the basis of the guild system. In the second half of the eighteenth century, the State reorganized the corporate structure. Corporate supervision on textile manufacturing quality finished in 1782. Guild corporations lost their fiscal privileges as tax collectors in 1801 (Ehmer 1998, pp. 128–129).

France followed an entirely different path. Until the fall of Turgot, French governments did not accomplish a genuine policy aimed at systematically removing restrictions on economic freedoms from the corporate structure. It is worth examining the reasons for French specificity. Several foreign observers recognized that the French guild system was particularly burdensome for a healthy economy. Josiah Tucker described the connection between the corporations’ zeal to secure their privileges and the State’s eagerness to obtain new revenues. It implied a vicious circle detrimental to France’s commercial relations with other countries, especially England (Tucker 1753, p. 28). Campomanes also acknowledged that the French corporate system was less flexible than the Spanish one, making corporate monopolies more harmful in France than in Spain (Campomanes 1776, p. clxxxvii).

French political economists before Turgot adopted historical arguments to explain the causes of the French exceptionality, which were among the reasons adduced for the abolition of February 1776. The State’s need to gather increasing revenues and the natural tendency of corporations to ensure their restrictive privileges led to a perverse system that turned into an insoluble problem since the sixteenth century ([Clicquot] 1758a, pp. 15, 122–126, 136; Bigot 1775, pp. 25, 28–35; Tsuda 1993, pp. 14–16; Charles, Lefebvre, and Théré 2011, p. 333). Modern studies corroborate this narrative. The intertwining of the guild’s privileged design with the government’s financial scheme highlighted the specificity of the French case and the difficulties that policymakers faced in implementing a reform policy stricto sensu. Any serious attempt to reform the corporate system immediately encountered the problem of debt and the State’s interest in maintaining secure tax revenues through a more substantial intervention and control (Marraud 2015). In other words, “la réforme ne fut jamais une véritable alternative à la Révolution” (Bien 1988, p. 402).

However, reformist initiatives occurred. Overshadowed by Turgot, his predecessor as contrôleur général, the abbé Terray attempted in 1771 a reform of corporate guilds. Terray’s solution tried to solidify the commodification of the maîtrises and offices, which, like any other property, could be available for sale or inheritance, making it possible to recover the capital invested (Kaplan 2001, pp, 63–64; Bien 2014, p. 139). The project envisaged the abolition of masterpieces and reduced and fixed the duties levied by the corporations. Moreover, Terray sought to solve the corporate debt problem by applying part of the corporate income to debt repayment (Journal Historique 1774, p. 355) and placed corporations under tighter State control. Notwithstanding, the Paris Parlement did not register the project, and, consequently, it failed.

The failure to implement substantial reforms showed the impossibility of developing a dissociation model in France and paved the way for the abolition of the corporate system. In principle, Turgot’s decree of February 1776 focused on the labor market. As Smith, Turgot considered the freedom of work a natural right (Édit du Roi … Février 1776, p. 5), radically distorted by the principle of corporate exclusion and the guild control of the labor market. The solution provided by the government to remedy this state of things was, logically, to declare the freedom to ply a trade and the abolition of the guild “Privilèges, Statuts et Réglemens” (Édit du Roi … Février 1776, art. 1, p. 4), together with the jurandes and maîtrises. Nothing new up to that point. However, the distinctiveness of the French case was evident from the edict’s first article. Apart from recognizing economic rights, the law abolished “tous les Corps et Communautés.” In the rationale of Turgot’s decree, there was no dissociation between guild corporations and the obstacles to economic freedoms linked to them. A reform designed to correct the deficiencies of the corporate system made little sense. The corporations of trades were the “source of evil” (source du mal). No reform could remedy the problem, and therefore guilds should be suppressed.

Turgot’s fiasco gave way to an equally unsuccessful reform attempt. A royal Édit of August 1776 (Kaplan 2001, chs. vi–x) reinstated the guild system and intended to eliminate the abuses contained in corporate regulations without jeopardizing the stability of the industrial structure. Masters belonging to newly created corporations could exercise their trade freely throughout the kingdom (Édit du Roi … Août 1776, art. XIV). However, the freedom to exercise a craft was recognized only for a limited number of trades. Corporate exclusion remained in force for fifty trades, including the influential Six Corps (Édit du Roi … Août 1776, arts. I, II). The August reform did not result in the regeneration of the corporate system (Kaplan 1986, p. 227), and neither did the persistent identification of corporations with their State-supported privileges diminish, even though the reform sought to introduce a hybrid system between economic freedom and regulation (Minard 1993, pp. 50–53).

The French course had significant repercussions in the field of economic thought and on political decisions throughout Europe. The polarization in favor of and against the suppression of the guilds intensified. While the impact of the French divergence reaffirmed the politicians’ intention to build middle-ground solutions in continental Europe, this middle path became increasingly difficult in France. The publication of Bigot de Sainte-Croix’s Essai immediately echoed in a Mémoire à consulter sur l’existence des Six Corps in February 1776. ¹⁰ The writing refuted Sainte-Croix’s identification conclusions: the system did not prevent capable artisans from becoming masters, and reception costs were a form of property, not an exclusive privilege (Mémoire à consulter 1776, pp. 12–13, 15). The author distinguished between privilege and monopoly. A privilege implied “d’heureuses entraves et des obstacles bienfaisants” that avoided an excessive number of craftsmen and guaranteed the quality of products. The Crown allowed the incorporation of the trades precisely to prevent monopolies and fraud against the public (Mémoire à consulter 1776, pp. 17, 19, 25). In other words, guilds did not enforce monopolies.

Like other writings that emerged in the wake of the suppression in France (Kaplan 2001, pp. 84–89), the positions in favor of the corporations did not intend to improve the guild system by finding some compromise between continuity and abolition. They aimed to counter the new policy of eradication. However, the government did not initiate any negotiation process but outlawed all favorable publications (“Arrêt … Février 1776”). The lit de justice that reaffirmed the governmental decision against the Paris Parlement’s judgment in March represented the high point of the confrontation over the suppression of the guilds before the Revolution (Flammermont 1898, pp. 293–324, 344–356; Faure 1961, pp. 447–454). The king’s advocate general, Antoine-Louis Séguier, unsuccessfully argued for a compromise solution to preserve a guild system freed of its defects (Flammermont 1898, p. 351).

The confrontation scheme after the French suppression spilled over outside France. In Spain, Antonio Capmany warned in 1778 of the apocalyptic dangers that would ensue if the corporate structure collapsed following the French example. Like Romà, Capmany preferred the continuity of guild restrictions to the daunting alternative of chaos associated with the complete freedom of labor and production. The abolition of guilds would be like sowing the Cadmus dragon’s teeth, a mythological hyperbole referring to the unleashing of anarchic forces (Palacio 1778, p. 36).

Now we will consider the impact of eighteenth-century theoretical approaches on the emergence of economic rights. In France, the revolutionary legal formulation was ambiguous and displayed the existing ambivalences in accepting the intellectual identification model. The Déclaration des Droits de l’Homme et du Citoyen declared all men free and equal in rights, which brought about the suppression of old regime privileges. The Assembly discussed the abolition of corporations during the night of 4 August 1789, yet the Déclaration des Droits included no mention of it (Mathiez 1931). Whereas it did not suppress the corporate system in strictly legal terms, all subsequent legislative developments concerning economic freedoms assumed this had been the case. On that basis, the d’Allarde law of 2–17 March 1791 declared the freedom to exercise a profession and the freedom of enterprise (Loi portant suppression … 1791, art. 7). Legal historiography has identified this statement as the definitive abolition of the corporate system. However, the act suppressed masterships’ certificates, reception fees, and corporate privileges (Loi portant suppression … 1791, art. 2). Baron Pierre d’Allarde considered the new law just a fiscal implementation of a pre-existing repeal ( Archives parlementaires , p. 216). The particularity of the French model of identification gave rise to a singular case of legal presumption: the preamble of the Constitution of September 1791 stated that “Il n’y a plus ni jurandes, ni corporations de professions, arts et métiers” (Constitution … 1791), even though the legal basis for the suppression was fragile. Nowhere else in Europe such a configuration occurred.

Campomanes’s policy’s failure did not prevent its continuation after the old regime’s fall, which modeled the consolidation of economic rights in Spain well into the nineteenth century. While Napoleonic troops occupied the Spanish territory, a decree issued by the besieged Parliament in the city of Cadiz on 8 June 1813 removed the compulsory corporate membership required for plying a trade (Colección 1820, p. cclxii). It declared the freedom to establish industries (fábricas) and the freedom to exercise any craft. The decree completed the eighteenth-century Spanish governments’ traditional policy without formally suppressing guild corporations (Diario 1871, p. 1478).

During the following century, continuity prevailed despite the upheavals of the troubled Spanish political evolution. After the death of the last absolute monarch in 1833, the successive pieces of legislation that confirmed economic freedoms essentially followed Campomanes’s model. On 20 January 1834, a royal decree declared (again) the suppression of corporate privileges and the monopolies related to the labor market (Decretos de la Reina 1835, bases 1, 3). Crafts organizations formally remained in place, and their regulations were bound to change according to some reform guidelines provided by the decree. Guild regulations continued as long as they did not contradict economic liberties (Decretos de S. M. la Reina 1837, base 5). Legally, the corporations of trades subsisted as mutual support organizations (Escriche 1839, pp. 239–240). However, the reform and its legal revisions never took place.

The pursuit of intermediate or pragmatic solutions prevailed in Austria when the old political regime slowly began to break down. The State transformed the corporations into an instrument of its social and economic policy. The 1859 Commercial Law replaced the corporations of trades with new associations that tried to integrate the artisans’ demands and free-market principles. The resulting ambivalence between two perspectives persisted to the extent that “[o]ne might question, therefore, when the Austrian guild system was abolished, or whether it was abolished at all” (Ehmer 1998, p. 121).

The Prussian case provided a late example of continuity and dissociation. The need to reorganize the country to overcome the Napoleonic threat gave way to the Stein–Hardenberg reforms. The government partially liberalized specific trades as early as 1806. The abolition of corporate monopolies and a standard tax on the practice of trades took place on 2 November 1810. Guild monopolistic privileges disappeared, while corporations persisted (Gray 1986, pp. 136–137; Levinger 2000, p. 81): corporate membership was no longer compulsory, and, since then, the guilds operated as voluntary associations.

However, to unify three legal systems (Holborn 1982, pp. 4–5) applicable to the guilds, Prussia introduced the 1845 Industrial Code. Among other functions, it maintained a renewed apprenticeship system and examinations for the admission of new masters under guild control (Rimlinger 1989, p. 559). The combination of economic liberties and the continuity of renewed corporations remained in the 1869 Industrial Act, approved by the Parliament of the North German Confederation and later extended to unified Germany through the Imperial Industrial Code (Gewerbeordnung). While maintaining craft corporations, it declared the freedom to exercise a trade, permitted the simultaneous practice of different crafts or the same craft in various places, and banned any corporate prerogative of exclusion (Gewerbeordnung 1872, secs. 1, 3, 4).

In Germany, eighteenth-century reformism culminated in a governmental policy designed to renew the guild system, which placed the corporations under strict State control and confirmed corporate functions considered helpful for the industry. In contrast to the Spanish case, corporate functions continued without hindering the development of modern, market-based industry (Biernacki 1995, p. 261), which led to the emergence of a “dual economy” that persisted at least during the nineteenth century (Pollard 2001, pp. 48–49).

The identification model found a late adherent in Sardinia. Like in France, on 14 August 1844, a regia patente declared the freedom to exercise a craft or profession and suppressed corporate privileges, vincoli, and restrizioni, including mastership fees, exams, or masterpieces (“Regie Lettere” 1845, pp. 153–167, art. 2). Moreover, the decree also abolished the organizations of trades and corporate regulations (“Regie Lettere” 1845, art. 1). The Italian unification process led to the application of the Sardinian abolition measures Italy-wide. On 29 May 1864, Parliament eradicated the corporations of trades throughout Italy (Raccolta 1864, pp. 626–629, art. 1). Unlike what happened in France, Italians conceived the freedom to choose a work (Collezione 1864, art. 1) as a legal consequence of the suppression (Collezione 1864, pp. 423–424).

IV. CONCLUDING REMARKS

This paper analyzes the compatibility between the guild system of industrial organization and the new structure based on the recognition of economic rights emerging in the different countries of continental western Europe. According to the generally accepted French revolutionary pattern, the traditional perspective assumes the intrinsic connection between the fall of the old regime, the declaration of economic rights, and the guilds’ dissolution. However, the systematic study of eighteenth-century political economists’ works shows that most of them criticize the shortcomings of the corporate system and advocate the implementation of reforms to deregulate industrial production and the labor market, leaving untouched the guild functions considered acceptable. Based on an intellectual dissociation between specifically anti-free market elements or restrictions on economic freedoms and craft corporations, they do not seek the complete abolition of corporations. Contrariwise, the peculiarity of the French guild system results in a divergence in mainstream European economic thinking, which identifies corporate guilds with the economic restrictions, privileges, and monopolies they enjoy. Consequently, it demands the complete abolition of the corporate structure.

The implementation of reforms aimed at removing corporate monopolistic privileges in the form of restrictions on economic freedoms rests on the mainstream of eighteenth-century economic thought. Outside France, reforms entail the recognition of corporate continuity after the guilds’ revamping: the reformist approach is incompatible with the abolition of corporations. From the reformers’ point of view, guild corporations perform certain valuable functions in a free-market context, such as the transmission of skills or mutual assistance. By contrast, in France, the impossibility of successfully carrying out structural reforms led to two complete suppressions. One was legally expressed in 1776; the other is the outcome of a generalized presumption in 1791.

Reformists calling for the revision of corporations include Vincent de Gournay’s circle members. Although it can be argued that their writings avoid explicit abolitionist references due to opposition from certain government circles, no author unequivocally states the need to suppress the organizations of trades. Gournay is concerned about the monopolization of production and work established in corporate regulations and advocates their removal. Some of his letters and the Mémoire sent to the Chamber of Commerce of Lyon are interpreted by Georges Sécrescat-Escande (1911), Takumi Tsuda (1983, 1993), Simone Meyssonnier (1989), and Benoît Malbranque (2016) as a call for the suppression of corporations. However, most of Gournay’s programmatic expressions refer to the rules containing corporate restrictions on production and labor and the need to eliminate them. The few references to the abolition of corporations are indirect or vague, including the mention in the Remarques on Josiah Child’s A New Discourse of Trade, and cannot support a consolidated position based on his writings in this regard.

The same is true of Clicquot de Blervache’s work. The Considérations revolve around the notion of eliminating guild regulations, for they embody the elements contrary to free competition deserving removal. While the questions proposed by the Amiens Académie explicitly mention the advantages of the abolition of the corps de métiers, the answers avoid taking a stance on the matter and transform the topic into a consistent plea against regulations. It is difficult to conclude that Clicquot, who is prone to pragmatic rather than radical solutions, leans unequivocally on the side of complete abolition on the grounds of a few direct references against guilds themselves, whereas the overwhelming majority deal with the suppression of regulations. Moreover, the Considérations envisioned the continuity of corporations “on a broader basis,” devoid of economic restrictions. Several decades later, Jovellanos shared Clicquot’s view regarding the permanence of a liberalized guild structure under State control.

There is also room for a different interpretation of Adam Smith’s ideas related to guild corporations. The dissociation paradigm represents the overall perspective in the British political economy before Smith. Smith offers a distinctive approach that considers the opportunity for corporate continuity: corporations’ suppression is not advisable since it would be contrary to freedom itself.

There is a direct connection between the mainstream of eighteenth-century economic thought and the emergence of economic rights after the fall of the old political regime in most European countries. The declarations of rights that indicate economic freedoms without including the abolition of the corporate system eventually crystallize the intellectual dissociation between corporations and economic restrictions. By contrast, the French model of identification assumes the suppression of corporations once economic freedoms are declared.

The dissociation model takes different forms. In unified Germany, economic freedoms couple with corporate continuity, and State-reformed corporations no longer enforce monopolies of labor and production. Instead, they develop mutual assistance and professional training functions within the framework of an industrialization drive. However, corporate survival is not guaranteed wherever the dissociation model applies. In Spain, guild corporations did not seize the opportunity to survive under a revised form despite being allowed by the law. Guilds were gradually diluted due to the general economic sluggishness and the lack of political support for a renewed corporate system compatible with the newly proclaimed economic freedoms.