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Political fragmentation, competition, and investment decisions: the medieval grinding industry in Ponthieu, France, 1150–1250

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  • KARINE VAN DER BEEK

Abstract

This article explores the effects of political structure on rulers' monopolistic gains and investment decisions in the context of the medieval milling industry in northern France, 1150–1250. Using Salop's spatial model, this article aims to show that political fragmentation increased investment in watermill construction because it reduced the capacity of rulers to limit competition from neighbouring mills. The calculations demonstrate that competition significantly reduced rulers' income from watermills and that the construction of more than 50 per cent of these mills cannot be economically ‘justified’ unless rulers' profit maximization over joint production is considered, and revenues from additional labour allocated to wheat production is included.

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  • Karine Van Der Beek, 2010. "Political fragmentation, competition, and investment decisions: the medieval grinding industry in Ponthieu, France, 1150–1250," Economic History Review, Economic History Society, vol. 63(3), pages 664-687, August.
    • Handle: RePEc:bla:ehsrev:v:63:y:2010:i:3:p:664-687
    DOI: 10.1111/j.1468-0289.2009.00484.x
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    1. Karakacili, Eona, 2004. "English Agrarian Labor Productivity Rates Before the Black Death: A Case Study," The Journal of Economic History, Cambridge University Press, vol. 64(1), pages 24-60, March.
    2. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring.
    3. Landers, John, 2003. "The Field and the Forge: Population, Production, and Power in the Pre-industrial West," OUP Catalogue, Oxford University Press, number 9780199249169.
    4. Allen, Robert C., 2001. "The Great Divergence in European Wages and Prices from the Middle Ages to the First World War," Explorations in Economic History, Elsevier, vol. 38(4), pages 411-447, October.
    5. Kevin Greene, 2000. "Technological innovation and economic progress in the ancient world: M. I. Finley re-considered," Economic History Review, Economic History Society, vol. 53(1), pages 29-59, February.
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    1. der Beek, Karine van, 2010. "The effects of political fragmentation on investments: A case study of watermill construction in medieval Ponthieu, France," Explorations in Economic History, Elsevier, vol. 47(4), pages 369-380, October.
    2. van der Beek, Karine & Mokyr, Joel & Sarid, Assaf, 2019. "The Wheels of Change: Technology Adoption, Millwrights, and Persistence in Britain’s Industrialization," CEPR Discussion Papers 14138, C.E.P.R. Discussion Papers.

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