Free Seas, Free Trade, Free People: Early Dutch Institutionalism

Abstract

“If you take into account how much less than elsewhere there was a necessity in the prosperous Low Countries to think about the causes of the wealth of the nation, you will see clearly why economics did not share in the flowering of sciences that this country experienced during the seventeenth century” (van Rees 1865, 286). Two propositions may be inferred from this quotation: there are almost no memorable seventeenth-century Dutch economists; and during the period, Dutch economic welfare and free trade as institutional foundations were not the result of a well-formulated economic doctrine but evolved more or less spontaneously. Although the second proposition has interesting implications for the theory of institutional development, I will deal with it here only briefly. The first .proposition can be corroborated by a quick glance through relevant texts on the history of economic theory. Blaug (1985) mentions de Groot only in passing, as does Hutchison (1988). Before Adam Smith, Holland seems to have had little to contribute to the emergence of political economy. Schumpeter, well acquainted as usual with not only