Peasants and Parliaments: Agrarian Reform in Eighteenth Century Europe

Abstract

Most scholars of development have lately converged upon one interpretation of the relationship between property rights, political representation, and long-run economic growth. In this familiar account, representative institutions are the guardians of property against governmental predation, be it in the form of forced loans, arbitrary taxation, or outright expropriations. Security of property, in turn, creates incentives for investment, specialization, innovation, and other forms of socially beneficial economic activity; the owners of productive factors can exploit them in the confidence that they will capture the social returns to their actions as private returns. Over the long run, representative bodies foster development by controlling and constraining the exercise of sovereign power. Of course, the argument that political inclusion stimulates growth has been made for any number of settings. Since North and Weingast (1989), many analysts have attributed the "Great Divergence" in global development from c. 1750 to the presence of institutional constraints on sovereign power in medieval and early modern Europe, and the putative absence of comparable constraints elsewhere. Analysts of this school likewise associate the "Little Divergence" between Northwestern Europe and the rest of the continent with variation in the strength of these constraints. In this project I put forward an alternative account of the relationship between property rights, representation, and growth. My point of departure from the standard narrative is the observation that many important developmental tasks, especially those associated with structural transformation of the economy, presuppose the existence of an agency that is authorized to transform the established regime of property rights, and in particular, to broker complex exchanges of rights. Consider, for instance, the problems implicated in farm consolidation and enclosure of open fields. Reforms of this variety involve many contracting parties, are distributively non-neutral, and frequently raise questions of observability and time inconsistency; such complex exchanges presuppose institutional support to ensure contractual performance. This is the role in which I cast the representative bodies of early modern Europe. The Estates could instantiate a political market for property rights, supporting complex exchanges and thereby allowing the parties to capture the gains from trade. This capacity is particularly important to development because it offers a legitimate procedure through which property rights that have ceased to serve a productive function may be abolished. Through a study of agrarian reforms in eighteenth century Eastern Europe, I examine this function of representative institutions and shed light on the conditions under which they are best able to perform it. The reforms involved state intervention in the relationship between manorial lords and their peasant subjects, whereby sovereigns undertook to improve the peasant's tenure on his farm, to regulate his obligations to the manor, and to shield him from arbitrary treatment. These policies necessarily encroached upon the lords' property rights, which presented each sovereign with a choice: she could proceed by trying to negotiate a settlement with the lords, assembled as a corporate group in the territorial Estates, or by way of imposition. As a rule, negotiated agrarian reforms were far more likely to effect real change in the lord-peasant relationship; early modern states were too weak to have any hope of implementing the reforms without the cooperation of a sizeable part of the nobility. To assess the contribution of the Estates to structural transformation, then, is to inquire about the conditions that made negotiated agrarian reform possible. Using a combination of statistical analysis and process tracing methods, I test the conjecture that the structure, procedure, and composition of the Estates themselves can account for variation in modes of reform. With regard to composition, the nobility's uppermost stratum – the aristocracy – was more likely than the lesser or petty nobility to acquiesce in state-sponsored agrarian reforms, and so negotiated reform tended to occur in territories whose Estates had a marked aristocratic bias. As for structure and procedure, I argue that a representative institution's capacity to support complex exchange depends on its internal configuration of decision-making institutions. Statistical analysis of agrarian reform initiatives in 24 Central and East European polities between 1730 and 1805 reveals that certain institutional attributes of the Estates are systematically associated with modes of reform: specifically, negotiated reform was most likely to occur in territories whose Estates were unicameral, made decisions by simple majority vote, and possessed a permanent institutional presence in the shape of a standing committee. To establish the mechanisms through which these institutional attributes eased the task of orchestrating exchanges of rights, I process trace the negotiation of agrarian reforms in the Russian Baltic province of Livonia between 1795 and 1804. In terms of their contribution to growth, my project suggests, representative institutions must be evaluated not just on the basis of their capacity to "get the prices right," but also on their ability to sustain a pro-developmental political coalition. In this capacity it is less important that representative bodies act as constraints on sovereign power than it is that they be able to adjudicate differences between interest groups within the regime's support coalition, to impose compliance with collective decisions, and to support complex exchange between groups and thereby allow the parties to capture the gains from trade. My main theoretical innovation here is the proposition that only certain types of early representative institutions could perform this function effectively; performance, in turn, depended on the Estates' internal configuration of decision making institutions. The upshot is that scholars interested in the contribution of early representative institutions to growth should attend more carefully to those institutional attributes of the Estates which facilitated rent sharing and adjustment of property rights in a pro-developmental political equilibrium.