Charles Davenant
From Wikipedia, the free encyclopedia
Charles Davenant (1656-1714), English economist, eldest son of Sir William Davenant, the poet, was born in London.
Contents |
[edit] Overview
He was educated at Cheam grammar school and Balliol College, Oxford, but left the university without taking a degree. At the age of nineteen he had composed a tragedy, Circe, which met with some success, but he soon turned his attention to law, and having taken the degree of LL.D., he became a member of Doctors' Commons. He was member of parliament successively for St Ives, Cornwall, and for Great Bedwyn.
He held the post of commissioner of excise from 1683 to 1689, and that of inspector-general of exports and imports from 1705 till his death in 1714. He was also secretary to the commission appointed to treat for the union with Scotland.
As an economist, he must be classed as a strong supporter of the mercantile theory, and in his economic pamphlets (as distinct from his political writings) he takes up an eclectic position, recommending governmental restrictions on colonial commerce as strongly as he advocates freedom of exchange at home.
Of his writings, a complete edition of which was published in London in 1771, the following are the more important:
- An Essay on the East India Trade (1697)
- Two Discourses on the Public Revenues and Trade of England (1698)
- An Essay on the probable means of making the people gainers in the balance of Trade (1699)
- A Discourse on Grants and Resumptions and Essays on the Balance of Power (1701)
[edit] Biography
• 1656 – Born, Son of Sir William D’Avenant, who was a well known Poet Laureate and playwright (1)
• 1660 – The Restoration in Britain: Charles II restored to the throne after the civil war, the Commonwealth led by Cromwell, and the Protectorate led by Cromwell’s son.
• 1668 – Father dies
• 1673 – Left school, became manager of father’s theater
• 1675 – LL. D from Cambridge, accepted into Doctor’s Commons, begins to practice civil law.
• 1678 – Commissioner of the Excise, earned 500 pounds per year; taxes were collected using the “farming system”
• 1683 – Britain ends tax farming system, Davenant receives 1000 pounds per year as Commissioner
• 1685 – Elected to Parliament as M.P. for St. Ives.
• 1688 – James II leaves the thrown, goes to France; William and Mary installed by Parliament as King and Queen of England
• 1689 – Davenant loses his position as Commissioner of the Excise; Davenant’s loan to James II nullified
• 1692 – Applied for Comptroller of the Excise with support of Godolphin, did not get the position
• 1694 – Applied for Comptroller of the Excise, but did not get the position, probably due to objections by the Charles Montagu, the Chancellor of the Exchequer
• Late 1694 – publishes “An Essay on the Ways and Means of supplying the War”, which was “a reasoned criticism of the methods used to finance the war [with France] which England had been waging sinc 1689. It attacked long-term borrowing as detrimental to trade, and land taxation as inequitable, because of its uneven incidence across the country.” (1, p. 280)
• November, 1695 – Wrote and read “Memorial Concerning the Coyn of England” to the Privy Council. This work was commissioned by the Lords Justices, and it was an argument against the majority party’s proposal that England’s coins should be devalued to pay for the war with France.
• 1696 – Published “A Memorial Concerning a Council of Trade”, which promoted his idea that trade should be protected; published “A Memorial Concerning Credit and the Means and Methods whereby it may be Restored”, which is generally viewed as an attempt to curry favor with the party in power in order to gain a post in the Excise department. (1, p. 281)
• October 1696 – Published “Essay on Publick Virtue”, which was a diatribe against the ruling party, the Junto, and a show of support for his friends in government, Shrewsbury and Godolphin, who were under political attack. Godolphin resigned shortly afterward, and Davenant lost his main supporter for appointment to a public office. (1, p. 281)
• 1696 – Published “Essay on the East India Trade” in which Davenant “opposed the protection of English Textiles against Indian competition on the grounds that commerce with East India improved Britain’s balance of trade, and he refuted the arguments of the protectionists with further applications of the balance of trade concept.” (1, p. 281)
• 1697 – Publishes “Discourses on the Publick Revenues and on the Trade of England” part 1, which contained strong objections to long term borrowing as a way to fund government expenditures and advocated paying back the debt incurred during the war as soon as possible. The basis for the argument is that “high taxation for debt service was a burden on trade, industry, and land.” (1, p. 282) Davenant still believed that land tax was unfair because it placed the heaviest burden of generating public income on the landed gentry, and that the long term result would be that the gentry would be forced to sell their land to “monied men and usurers” (1, p. 282) to pay the taxes.
• 1698 – Publishes “Discourses on the Publick Revenues and on the Trade of England” part 2, which described “in a more sustained and complete form the idea of the idea of the ‘general’ balance of trade.” (1, p. 282) There is a likely possibility that this pamphlet was also intended to keep his name before the officials of the East India Company as someone who was sympathetic to their business because he was trying to get them to hire him as an agent. (1, p. 282)
• 1698 – Davenant returns to Parliament as a representative of Great Bedwin; he becomes associated with the Tory party, which replaces the Junto party as the majority in Parliament.
• Early 1699 – Published “An Essay on the probable Methods of making a People Gainers in the Balance of Trade”, which quoted Gregory King’s calculation of the value and size of the “natural resources of England.” (1, p. 282) The last section contained an attack on the actions and policies of the Junto party and was more of a political rant than an exposition of economic ideas.
• End of 1699 – Published “A Discourse of Grants and Resumptions”, which discussed the practice of the king and queen of England granting “forfeited Irish Estates” (1, p. 283) to friends and political allies of the Junto party. Davenant’s writings begin to shift away from economic discussions to political commentary designed to curry favor with the ruling party in order to secure employment.
• 1701 – Published “Essays upon I The Balance of Power II The Right of Making War, Peace, and Alliances III Universal Monarchy”, which was “a highly partisan attack on William III’s foreign policy.” (1, p. 283)
• March 1701 - Davenant was linked to French agents at this time, and it was suspected, but not proved, that the French government tried to bribe him to promote their interests and to provide intelligence if England declared war on France. There is evidence that a French agent recommended bribing Davenant (1, p.283), but there is no evidence that “a bribe was ever actually offered or accepted.” (1, p. 283) The link with the French agent tarnished Davenant’s public and political reputation.
• August 1701 – Published “The True Picture of a Modern Whig”, which was attempt to counter the Whig party’s push to dissolve the Tory party Parliament by “defending Tory views and exposing Whig motives.” (1, p 283)
• 1701 – Published “Tom Double Returned out of the Country”, which explained all of Davenant’s ideas on trade and public finance and the underlying reasoning behind them. The main concern is that the Whig party would restart the war with France and put the country further into debt, which would in turn require greater taxation of land owners. The land owners would be bankrupted, and the people who had made money off the war would be able to buy the land and usurp the political power of the gentry.
• 1702 – Queen Anne assumes the throne. The Junto party is removed from power, and Davenant’s friends – Godolphin, Nottingham, and Harley – are placed in positions of power.
• September , 1702 – Davenant is appointed to the Secretaryship of a commission to negotiate for the union of Scotland and England.
• June 1703 – Appointed Inspector General of the Imports and Exports
• November 1703 – Published “Essays upon Peace at Home and War Abroad”, which “promoted ‘moderation’ and the anti-party attitude favored by the Queen and Harley.” (1, p. 285) This pamphlet angered his friends in the Tory party because it was in opposition to the policies the party was pushing at the time. Before 1702, he is the leading promoter of party ideas. With this essay, he is falling out of favor and is gaining a reputation for promoting whatever idea benefits him the most personally.
• 1703 – There is some evidence that Davenant is spending more than he makes by this time. (1, p. 286)
• 1704 – Davenant proposed compiling trade numbers for the previous 25 years. The cost of clerks to do the actual tabulation was the primary reason for denial of his request. (1, p. 286)
• Autumn 1705 – Davenant visits Holland to research the wartime traffic between France and Holland. He writes but does not publish “Memorial Concerning the Free Trade now Tolerated between France and Holland.” The goal was to find support for the current policy of permitting trade between France and Holland. (1, p. 286) Davenant displays a favorable opinion of the Dutch in this pamphlet, which is a completely opposite position from the one he promoted in nearly all his other pamphlets.
• 1709 – Published “Reflections upon the Constitution and Management of Trade to Africa”, in which Davenant “reverted to his normal attitude of suspicion and outright hostility towards the Dutch.” (1, p. 286) This pamphlet advocated renewing the Royal African Company’s monopoly on slave trade on the basis that the Dutch competition “necessitated the maintenance of forts, which only a joint-stock company could afford.” (1, p. 286) Waddell states on p. 286 that there is close collaboration between the company and Davenant and that he was possibly compensated for writing it. He did go to great lengths to publish the pamphlet anonymously, and he was apparently in a difficult financial position; therefore, it is likely this was a work-for-hire and not something which Davenant actually supported.
• 1710 – Godolphin loses his office, which removes one of Davenant’s supporters from power and threatens his position as Inspector General of the Imports and Exports. Davenant writes “”Sir Thomas Double at Court” and “New Dialogues upon the Present Posture of Affairs” as way to make amends with the Tory party, which was likely to be coming back into power. “Sir Thomas Double at Court” reversed Davenant’s argument for moderation in his “Essays upon Peace at Home and War Abroad” published in 1703; and “New Dialogues upon the Present Posture of Affairs” repeated the attacks on the methods of financing public spending that he had been stating since 1689. (1, p. 287). He also reversed his stance from “Memorial Concerning the Free Trade now Tolerated between France and Holland” and argued that the Dutch were benefitting from trade with France while “Britain bore the burden of the war.” (1, p.287)
• 1712 – Published two “Reports to the … Commissioners for … Public Accounts”. Although these reports contained a large amount of statistical data, they continued the theme from “New Dialogues upon the Present Posture of Affairs” that Holland was benefitted from trade with France while Britain took on heavy debt during the war with France and that trade with France “was or could be advantageous to England.” (1, p. 287) This coincided with Jonathan Swift’s “Conduct of the Allies” and provided the economic basis for peace and a commercial treaty with France.
• 1714 - Died
[edit] Contributions
There is some question whether the Law of Demand was developed by Gregory King and then used in some of Charles Davenant’s writings or whether King and Davenant jointly developed the idea based on King’s statistical work and published their theory in Davenant’s pamphlets. (2, p.488) King does not describe a formal definition of the law in his journal, which is the primary source of his writings, (2, p. 488) and Davenant does not seem to be an innovative thinker and often wrote pamphlets to promote ideas or policies that would be beneficial to his personal economic or political status; therefore, it seems likely Davenant extended King’s work to prove his claims that borrowing to fund the war was bad for England’s economy and that excise taxes were the appropriate way to fund the government.
Davenant is also credited with being the first to discuss the concept of Balance of Trade as being an important part of the financial health of a country. The foundation of the idea is that importing more goods than were exported would create an outflow of currency. He proposed in “An Essay on Ways and Means of Supplying the War” in 1695 that “export surplus was the best way to finance the war” (3, p. 138) as opposed to taking on long term debt and increasing taxes on landowners.
In 1696, Davenant writes “Essay on the East-India Trade”, which continues the argument that imports should not be restricted because England was a net exporter of the goods imported from India. (3, p. 139) The restriction of imports would prevent re-exporting the goods to the rest of Europe, and that would decrease the total income of the government. He also expresses a great dislike and distrust of the Dutch government for most of his life, and he feared that if Britain did not supply Indian imports the Dutch would supply Europe instead. He did seem to be the first to understand the basic concepts of consumer demand and perfect competition, even though bias against the Dutch stems more from fear of a political challenger to England than fear of losing the competitive advantage of England’s monopoly in India.
[edit] Contemporaries
[edit] Bibliography
1. Charles Davenant (1656-1714)-A Biographical Sketch
D. Waddell
The Economic History Review, New Series, Vol. 11, No. 2. (1958), pp. 279-288.
Stable URL: http://links.jstor.org/sici?sici=0013-0117%281958%292%3A11%3A2%3C279%3ACD%28BS%3E2.0.CO%3B2-S
2. The Law of Demand--The Roles of Gregory King and Charles Davenant
G. Heberton Evans, Jr.
The Quarterly Journal of Economics, Vol. 81, No. 3. (Aug., 1967), pp. 483-492.
Stable URL: http://links.jstor.org/sici?sici=0033-5533%28196708%2981%3A3%3C483%3ATLODRO%3E2.0.CO%3B2-0
3. The Growth of Economic Thought
Henry William Spiegel
Revised and Expanded Edition, pub. 1983, Duke University Press
This article incorporates text from the Encyclopædia Britannica Eleventh Edition, a publication now in the public domain.
