The Journal of Economic History

ARTICLES

Fiscal Crisis and Institutional Change in the Ottoman Empire and France

Eliana Ballaa1 and Noel D. Johnsona2

a1 Financial Economist, Federal Reserve Bank of Richmond, Baltimore Office, 502 South Sharp Street, Baltimore, MD 21201. E-mail: eliana.balla@rich.frb.org.

a2 Assistant Professor, Department of Economics, George Mason University, Enterprise Hall, MSN 3G4, Fairfax, VA 22030–4444. E-mail: njohnsoL@gmu.edu.

Abstract

Why is it that some countries adopted growth enhancing institutions earlier than others during the early modern period? We address this question through a comparative study of the evolution of French and Ottoman fiscal institutions. During the sixteenth century, both countries made extensive use of tax farming to collect revenue, however, uncertain property rights caused by fiscal pressure led to different paths of institutional change in each state. In France, tax collectors successfully overcame the collective action costs of imposing constraint on the king. In the Ottoman Empire, tax collectors faced prohibitive transaction costs to organizing in a similar manner.

Footnotes

We thank the following people for their assistance in researching and writing this project: Douglas Allen, Murat Çizakça, Metin Coşgel, Shahid Ebrahim, Alejandra Edwards, Steven Fazzari, Edgar Kiser, Timur Kuran, Jean-Laurent Rosenthal, Sanjay Subrahmanyam, seminar participants at ISNIE 2004, the National Tax Association Meetings, UCLA's Von Gremp seminar, the University of Manitoba, California State University, Long Beach, UC Riverside, and three anonymous referees from this Journal. Any mistakes are the fault of the authors. Contact author is Noel D. Johnson at njohnsoL@gmu.edu. An earlier version of this article was a chapter in Eliana Balla's dissertation. The views expressed in this article belong to the authors and do not represent those of the Federal Reserve Bank of Richmond or the Federal Reserve System.

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