The “General Crisis of the Seventeenth Century” occurred on the background of the Little Ice Age (1660-1720),
a dramatic change in climate conditions which generated significant insecurity for the subsistence of the poor and the revenues of the court and landed elites.
In response to these challenges, England developed a new model of economic, social, and political development. It was based on trade, industry, and the extension of the monetary economy, but was resisted by land-owning elites. The Stuart Kings and their Tory supporters sought to increase the extraction of agricultural surpluses, while the Whigs, merchant bankers and their friends in Parliament developed the monetary credit economy. The innovations brought about during the Civil War (1640-1660) were slowed down during the Restauration, but the break-through came after the Glorious Revolution 1688.
The paper provides evidence for the impact of the Little Ice Age and the monetization of the English economy. It shows the dramatic increase in food insecurity and the response in the supply of credit money. It also provides econometric estimates for the political conflict between landed interests at the Court and merchant interests in the country. This analysis invites to rethink the role of money in history.
Professor Stefan Collignon is ordinary professor of political economy at Sant’Anna School of Advanced Studies, Pisa, since October 2007, and was International Chief Economist of the Centro Europa Ricerche (CER), Roma, 2007-2019. He is the founder of Euro Asia Forum at Sant’Anna School of Advanced Studies.
Professor Waltraud Schelkle is Professor in Political Economy at LSE.