How smashing the NIMBYs created modern capitalism

Industrial modernity was invented in the English midlands around the end of the eighteenth century, kicking off an unprecedented global rise in living standards that continues to this day. But what made this revolution possible was a lesser-known political revolution that took place in the previous century: a period known in English history as the Glorious Revolution. Today, the Glorious Revolution is remembered for having introduced the system of constitutional monarchy, which subordinated the power of the monarch to Parliament. What is really interesting, though, is how Parliament used its new power: to untangle excessively strong and complex property rights, making it possible for the first time for sustained investments to take place in infrastructure and agriculture across England. And unlike in most other political revolutions, this happened almost entirely peacefully and with the consent of the people whose rights were being redrawn.

Get the print magazine Subscribe for $100 to receive six beautiful issues per year. Subscribe Fragmented political and property rights have again become one of the Western world’s biggest problems, leading to the ‘vetocracy’ that paralyzes many developed countries. Could we foment a Glorious Revolution of our own?Multiple sclerosesSeventeenth-century Europe was economically stagnant. Despite intellectual advances like the creation of patent systems, the flourishing of mathematical schools, and the founding of learned societies like the German Leopoldina and France’s Académie des Sciences, the physical world saw only plodding progress.Agriculture was practically the only game in town. Almost everyone lived in small rural settlements: fewer than ten percent of Europeans lived in towns of more than 5,000 people in 1500. By 1700 this had grown to just 12 percent; and by 1800, to 15 percent. In France, Europe’s most populous country, nearly 70 percent of the workforce worked in agriculture between 1695 and 1790. Germany was similar, and Scandinavia, Russia, Eastern Europe, Southern Italy and Spain were possibly more agrarian.The default was for countries to continue for centuries with virtually no growth. Spanish output per capita was flat for half a millenium between 1300 and 1800.

Other areas saw temporary bursts of growth, followed by stagnation or reversion: Swedish and Portuguese incomes were lower in 1800 than in 1550, and the Italian efflorescence during the Renaissance was followed by steady decline for centuries. Even the Dutch golden age of 1500 to 1680, which saw the Netherlands buck the European trend with a large majority of its population working in industry or commerce and living in towns, was followed by more than a century of relative stagnation.Property ownership was so fragmented that nobody investing in improvements could expect to make a return. Splintered ownership of farmland discouraged the adoption of new crops and rotations. Rigid inheritance rules made it prohibitively difficult to invest in improvements to land or infrastructure. Roads were bad because nobody took responsibility for them, hindering the transportation of manure for fertilizer and preventing the trade that would allow different areas to specialize in different crops. Agricultural yields were so low that nearly everybody had to work to produce food instead of in other industries like mining or manufacturing.Many European states tried to solve these problems, and nearly all failed. The reason was usually the same: monarchs depended on the support of landowning aristocrats and clergy, and those landowners had no confidence that reforms would leave them better off.In 1746, Spain’s King Fernando VI tried to replace his country’s complex tax system with a single income tax to fund public investment, but was blocked by nobles, the church, and municipal oligarchies. In 1776, French Minister of State Anne-Robert-Jacques Turgot tried to liberalize the property system and replace the patchwork of taxes with a single land value tax, but the Parlement of Paris refused to register his reform edict. In 1781, Austrian Emperor Joseph II abolished formal serfdom, but ex-serfs remained effectively bound until 1848, since the crown enforced landlords’ prerogatives.Only one country succeeded in modernizing its property rights in this period: England. The Glorious Revolution resolved the conflict between landowners and the Crown by handing the country to the landowners. One might expect this to have produced an oligarchy that jealously guarded its privileges. But the landowners, precisely because they were empowered, did something their continental counterparts could not.

They dismantled the fossilized property arrangements that had blocked development elsewhere, and in doing so, set the stage for the Industrial Revolution.The Glorious RevolutionIn 1685, James II ascended the English throne. Several previous kings had faced accusations of covert Catholicism, but James II made no secret of his faith. He appointed Catholics to a range of government posts and tried to assert control of local governments, so that he could appoint the officeholders who oversaw elections to pack Parliament with loyal stooges. All this fueled fears that James was imposing Catholic, absolutist rule. According to one contemporary, at least 20,000 opposition pamphlets were circulated across the country during James’s short reign.

William of Orange arrives in England, as depicted by the Dutch artist Johan Herman Isings. Isings may have taken some artistic license in depicting locals joyously rushing into the sea to welcome the invaders, but James’s rule really was unpopular, and William triumphed almost without bloodshed. Image In June 1688, seven aristocrats wrote to William of Orange, inviting him to invade England with their support. William was the Dutch Republic’s head of state, married to James’s eldest daughter, Mary and, crucially, a Protestant. In their letter, the seven wrote that ‘the people are … generally dissatisfied with the present conduct of the Government in relation to their religion, liberties, and properties (all which have been greatly invaded)’.William landed at Torbay on 5 November that year with 20,000 Dutch soldiers and English exiles. The English defending army defected or melted away without a fight, and James fled to France, effectively abdicating. William and Mary were crowned as joint monarchs in April 1689.A new political settlement quickly emerged. Parliament passed a Bill of Rights, reestablishing its own legal supremacy; the Mutiny Act of 1689 forbade a standing army without parliamentary assent; and taxes were decreed to expire after a year, requiring the monarch to call Parliament for renewals. Later acts established regular elections.Today, this cementing of Parliamentary supremacy is what the Glorious Revolution, as William’s invasion came to be known, is most remembered for.

But a second consequence was even more important: dramatically increased legislative productivity. In the lead up to the Glorious Revolution, James II and his predecessor, his older brother Charles II, had been trying to rule without Parliament, dismissing it before it could pass legislation or simply not calling it. Parliament met infrequently at the end of Charles II’s reign, especially after the Exclusion Crisis of 1679, in which it had sought to pass bills excluding the future James II, by then a known Catholic, from the line of succession. Following this, it did not meet again for nearly all of James II’s short reign.Before 1688, bills frequently failed because the monarch cut sessions short. After it, Parliament became an extremely active legislature, passing thousands of acts. Before the Glorious Revolution, legislative sessions had been short and variable: the average number of working days per session was 61 between 1660–85 and 57 for 1660–89. While some sessions lasted over 400 days, most lasted fewer than 50. Afterwards, legislative sessions met annually, owing to the requirement to renew military funding and the right to court-martial deserters. They began in autumn or winter and continued for more than 100 days.From 1660 to 1689, about 25 acts passed per session. Between 1688 and 1724, the average increased to 50–75 acts per session, rising to over 100 and eventually 200 per session in the late eighteenth century. Access also broadened. Before the Revolution, only the largest landowners brought bills to Parliament. Afterwards, many more minor gentry with no obvious political connections applied. The vast majority of these bills sought to reform landholdings or property rights in some way, either consolidating them, removing legal restrictions on how the land could be used, or allowing developers to charge for access to new or improved infrastructure.

Fragmented ownershipAcross early modern Europe, plots of land were small as a result of the traditional open-field system, in which tenant farmers held many small strips of land scattered across different fields, as well as inheritance laws that divided landholdings equally among descendants.

Most agricultural land was farmed under variants of the ‘open-field’ system, in which large fields were divided into small strips over which individual farmers had partial ownership rights. In some countries, these strips are still visible today. Image Wikimedia. The problems with small fields grew as technology improved, creating the potential for new economies of scale. The horse plough was faster than a team of oxen, but on a farm of many small plots, the ploughman spent more time turning and moving between them, so the advantage was dwarfed by a horse's greater food cost. Under Russia’s equivalent system, peasants wasted as much as half their time moving between land strips. English farmers faced similar inefficiencies.Small farms and the open-field system also made it hard to adopt better crops. The medieval three-crop rotation left each field fallow every third year to restore nitrates to the soil. The Norfolk four-course rotation eliminated this dormant period by sowing clover and turnips in the off year, which served equally well to replenish nitrates. But this was almost impossible on shared fields. Turnips and clover were hard to protect from neighbors’ grazing animals, which would not stay within strip borders. And in a fragmented system, anyone who wanted to sow a new crop would have to duplicate the work already shared by those sowing other crops, meaning that switching over required near-universal agreement.As well as small farms and the open-field system, a third problem was common land: an uncultivated area on which local landowners had the right to graze their animals. The free mingling of livestock made selective breeding difficult, since owners couldn’t control which mated with which. It also meant this land was often overgrazed, since everybody was incentivized to overuse it. Since it was owned collectively, it was difficult to agree to do anything else with it: it could be reorganized or improved only by sending a petition to Parliament showing unanimous support of local landowners. A single holdout could block any change.

Laxton, the last-surviving farm operated under the open-field system. Image Bodleian Library.